Sweepstake and Contest Laws

Laws and Rules for Sweepstakes in Connecticut

First, it helps to understand the difference between a sweepstakes, contest and lottery. In a sweepstakes, winners are chosen randomly from all participants. In a contest, the winners’ entries are usually judged and are based on a skill or criteria. In a lottery, winners are chosen at random, but in order to enter, the participant must pay. A payment is called a consideration. Only states can hold lotteries, so all private lotteries are illegal.

To avoid being classified as an illegal lottery in any state, your promotion can only have 2 of these 3 elements: prize, chance and consideration. Keep in mind, consideration can mean anything of value, including a fee or even a significant effort (i.e., time spent shooting/submitting a photo, etc.)

Here are possible combinations:

• Prize + consideration + chance = illegal lottery or gambling
• Prize + consideration = legal contest (in most jurisdictions)
• Prize + chance = legal sweepstakes

All sweepstakes in the United States must meet the following regulations:

1. No purchase necessary. You can enter the sweepstakes without buying a product or service.
2. Winners are required to pay taxes on prizes they win.

Sweepstakes are regulated nationally and by state by the following organizations:

• Federal Trade Commission (FTC)
• Federal Communications Commission (FCC)
• United States Postal Service (USPS)
• United States Department of Justice (DOJ)

State Specific Sweepstakes & Contest Laws

Besides federal considerations, every state has its own specifics laws regarding sweepstakes and contests.

Connecticut (CT)

Connecticut also wants sweepstakes and contests to be free to enter and free of consideration. If there’s any condition or restriction to receive a prize in the sweepstakes, you’re not allowed to advertise the promotion in the state. You also can’t advertise a contest where a prize is valued at $200 or more and where the participant has to pay an entry/judging fee or has to make a purchase to help them win.

Contests: are allowed as long as they do not charge a consideration. Contests charging consideration are restricted to less than $200 in Approximate Retail Value of prizes. Sponsors with purchase-to-enter contests are excluded.

Sweepstakes: are allowed as long as participants do not pay consideration.

Promotional Laws - Connecticut- Contests

• Connecticut does not allow consideration (payment to participate) if the contest offers a prize with a retail value over $200.
• Connecticut prohibits the advertising of any contest that charges consideration.
• The prohibition on advertising does not apply when a contest participant pays a consideration for the purchase of a consumer product or service, as long as the purpose of the contest is to promote the sponsor’s products or services.

Legal Review Criteria: Dominant Factor Doctrine when assessing whether or not chance determines the outcome of a promotion.

Note: the information above is for informational purposes only and should not be construed as legal advice. Sweepstakes and Contest promotional laws change and the above may not reflect the must current laws.