If you want your business to run a sweepstakes or contest you must be careful to structure the promotion so it is not characterized as a lottery under state and federal law, as lotteries are illegal unless sponsored by government entities. Some states, such as Florida, New York, and Rhode Island have registration requirements if the total amount of prizes exceeds a certain amount. And there are a number of issues you should address in the official rules you publish with the sweepstakes or contest.

In Delaware, as in other states, businesses must ensure that their sweepstakes or contests do not qualify as illegal lotteries. A lottery typically includes three elements: consideration (entry fee or purchase), chance, and a prize. To avoid being classified as a lottery, at least one of these elements must be removed. Most businesses eliminate the consideration element by allowing free entry. Delaware does not have specific registration requirements for sweepstakes or contests like Florida, New York, and Rhode Island do. However, businesses must still comply with state consumer protection laws and federal regulations, such as the Deceptive Mail Prevention and Enforcement Act. Official rules for the promotion should be clear and include details on eligibility, entry procedures, prize descriptions, odds of winning, and how winners will be selected and notified. It's important to note that if the sweepstakes or contest is conducted online or has nationwide reach, the rules of other states may also apply, and federal laws such as the CAN-SPAM Act could impose additional requirements.