Rules for Sweepstakes

Rules for Sweepstakes
Fall under FTC scrutiny
Need to draft a specialized
Terms and Conditions agreement
If your promotions fall under the sweepstakes category, you will:

Here is how to know whether your promotion is a sweepstake
and whether it is subject to FTC scrutiny.

What are Sweepstakes
Sweepstakes are a promotion effort where a winner (or winners)
receives a prize.
Participants in sweepstakes enter the contest by performing a
small task such as sharing social media posts or filling out
forms on websites.
Rules for weepstakes

Publishers Clearing House

Chance;
A prize; and
Payment by the participant.
According to the FTC, a lottery has three elements:
The payment element is the main factor that turns a fun contest
into a lottery.
While sweepstakes are legal, lotteries by private entities are not.
In the U.S., lotteries must be regulated and managed by state
lottery commissions.

Sweepstakes take a different approach by not requiring
a payment or purchase to enter.

Corsair (1) runs frequent
sweepstakes on its Facebook (2)
and Twitter (3) pages.
Corsair
(1) Link to http://www.corsair.com/en-us
(2) Link to https://www.facebook.com/Corsair/
(3) Link to https://twitter.com/Corsair

Corsair
A Facebook post from Corsair
only requires liking the post
and their page:

Sweepstakes rules
from the FTC

The lack of payment is an obvious element that separates
sweepstakes from a lottery or worse, a fake prize scheme.
Generally, if you plan on running sweepstakes as a
promotion effort, do not require a payment.
No required payments
Sweepstakes rules from the FTC

While the FTC does not have any specific requirements (4) on how
to spread the word about your sweepstakes on social media, there
are recommendations regarding social media.
(4) Link to http://www.ecfr.gov/cgi-bin/text-idx?SID=175a5a6b52c4e424ba2f36c7c2ddbeb3&mc=true&node=pt16.1.255&rgn=div5
Advertise with caution

Instragram
First,
make it obvious that
it is an advertisement.
Learn how to
disclose this (5).
(5) Link to https://termsfeed.com/blog/ways-you-can-disclose-endorsements/

Second, be careful of how you allow consumers to promote
your sweepstakes.

If there’s any compensation or additional sweepstakes entries
that result from sharing, liking or getting other people to sign up,
that needs to be in your announcement.

Examples

Terms and Conditions
for sweepstakes

You need a separate Terms and Conditions agreement
for your sweepstakes.
The content of this legal agreement is different enough
from your general Terms and Conditions that you use
for your website or mobile app.
Terms and Conditions for sweepstakes

“No Purchase Necessary to Win”

The rules of sweepstakes must make this statement clearly.
Most Terms and Conditions agreements for sweepstakes
place this at the top and often in all-capital letters.
There’s a good reason why companies make that choice: any
inference of a payment or purchase requirement to enter the
contest can lead to problems with the FTC.
“No Purchase Necessary to Win”

Examples - Amazon
Sweepstakes Terms and Conditions
• NO PURCHASE OR PAYMENT REQUIRED TO ENTER OR WIN.

Examples - Priceline
priceline.com Summer Road Trip Sweepstakes
OFFICIAL RULES
NO PURCHASE OR TEXT MESSAGING IS NECESSARY TO ENTER OR TO WIN. A PURCHASE OR TEXT
MESSAGE DOES NOT IMPROVE ONES CHANCES OF WINNING. STANDARD MESSAGING/DATA RATES,
TERMS AND CONDITIONS WILL APPLY FOR ENTRIES OBTAINED VIA MOBILE PHONE/DEVICE. MAY
NOT BE AVAILABLE FROM ALL SERVICE PROVIDERS OR FOR ALL HANDSETS. CHECK WITH YOUR
SERVICE PROVIDER FOR DETAILS. VOID IN ALASKA, HAWAII, AND WHERE PROHIBITED BY LAW.

Examples - Corsair
NO PURCHASE IS NECESSARY TO ENTER OR WIN. VOID WHERE PROHIBITED.
Terms in these Sweepstakes Terms and Conditions shall serve as the Official Rules for the
Sweepstakes.

Entry procedures
Make the entry procedures to users clear in
the Terms and Conditions.

Examples - Amazon

Examples - Corsair
ENTRIES
No use of any use of robotic, automatic, programmed or the like entry methods will be
allowed as well as incomplete entries. Entries from persons who are not eligible to win per
these official rules will be disqualified.

Entry participation limits
Many companies want to limit sweepstakes participation as
it can reduce liability issues and also helps companies avoid
the complexities that may be involved offering prizes in some
jurisdictions.

Examples - Amazon
Entry participation limits
• You must be an individual legal resident of the 50 United States or the District of Columbia
and the older of 18 years of age or the legal age of majority in your state of residence. Limit
one entry per person per social media or customer account.

Close dates
Deadlines should also be clear in the Terms and Conditions
of the sweepstakes.

Examples - Priceline
Close dates
2. Sweepstakes Period: For all purposes of this Sweepstakes, the Sponsor’s computer is
the official clock and all times refer to Eastern Time ("ET"). The Sweepstakes period begins
at 12:00:00 p.m. ET on June 30, 2014 and ends at 11:59:59 p.m. ET on July 31, 2014
("Sweepstakes Period").

Examples - Amazon
Close dates
• The promotion begins and ends on the dates and times specified in the linked announcement
for the promotion (e.g., the post on our Facebook Page.)

Winner notification
Detail how winners of your sweepstakes will be notified.

Examples - Amazon
Winner notification
• Winners will be notified as specified in the linked announcement for the promotion within 5
days of the end of the promotion, and once notified, you will have 24 hours to claim the prize.

Examples - Corsair
Winners will be notified by e-mail within five (5) business days of the prize drawing. If a selected
winner cannot be contacted, is ineligible, or fails to claim a prize, the prize will be forfeited and
an alternate winner may be selected from remaining eligible entries.
Winner notification

Others
What more you should add to the Terms and Conditions for your
sweepstakes is:
Prize list
Sponsor identification
Odds of winning
Process for selecting winners
Tax responsibility

The essence of your sweepstakes Terms and Conditions is
communication.
Make it a separate document from your general Terms and
Conditions agreement and keep it simple.
Learn more about the rules on sweepstakes at:
https://termsfeed.com/blog/sweepstakes/

Credits
Icon from slide 14 created by PJ Souders from Noun Project.
Icon from slide 34 created by Chameleon Design from Noun Project.

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