Running sweepstakes or giveaways are an excellent way to increase interest in your products and attract new customers. However, before you launch your contest, you’ll need to be aware of the laws in Connecticut to ensure the state doesn’t classify your promotion as an illegal lottery. This article will cover the basics of Connecticut contest & sweepstakes laws, so you can ensure your campaign complies.
The law separates promotions of this nature into three categories: sweepstakes, contests, and lotteries. Of these three categories, sweepstakes and contests are both legal, although required to pay taxes, while the law bars companies and individuals from operating lotteries.
The definitions for each are as follows:
A promotion that gives customers a chance to win a prize in exchange for taking a qualifying action, such as filling out an entry form, making a purchase, or referring a friend to the business. For sweepstakes to be legal under Connecticut contest & sweepstakes laws, they must meet the following requirements:
- There must be no purchase necessary to enter the promotion.
- The odds of winning must be fair and balanced.
Sweepstakes and contests are very similar in concept. The main difference is that a contest requires participants to submit an original entry in the form of an essay, video, or another form of creative expression to win a prize. In addition, to be legal under Connecticut law, contests must meet the following requirements:
- Participants must submit their entries voluntarily.
- Businesses should state the terms and conditions of their promotions clearly so that customers know what to expect.
- The promotion’s advertising should be clear and prominent, so entrants know what the promotion is and how to enter.
Lotteries are a form of gambling and are not legal anywhere in the United States unless instituted by the state directly. Under Connecticut contest & sweepstakes law, a lottery is a promotion in which participants must buy something of value, such as raffle tickets, to win a larger prize. These promotions do not meet the legal requirements of sweepstakes or contests and are, therefore, not permitted.
In order to avoid running afoul of Connecticut’s contest & sweepstakes laws, a business should consider whether or not their promotion is a game of chance or if it offers players the opportunity to win through skill. If it is a game of chance, it should meet the statutory requirements for sweepstakes or contests. On the other hand, if the game involves skill and does not involve monetary exchange, then it may be classified as a game, in which case it need not to either a sweepstake or contest. To determine if your game is a legal sweepstake or contest, consider all of the following criteria:
Do the official rules of the promotion require entrants to pay an entry fee?
If so, this suggests that the contest is not a game of skill and therefore does not meet the legal definition of sweepstakes or contest.
Is the promotion dependent on chance?
If the player has no control over the outcome of their play, it is a game involving chance. If the result of the game depends on random selection from a hat or other device designed to produce a random outcome, for example, it is a game of chance.
Get Help with Your Next Promotion Today
If you’re planning a promotion or giveaway for your company, navigating the Connecticut contest & sweepstakes laws you’ll need to follow can be challenging without legal advice. Our experts at National Sweepstakes Company, LLC can help you plan a legal and successful promotion to build excitement around your brand. Call today at 888-744-3217 to learn more about how we can help your business grow.