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 Tennessee, as in other states, businesses must ensure that their sweepstakes or contests do not qualify as illegal lotteries. A lottery typically includes three elements: prize, chance, and consideration (entry fee or purchase requirement). 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. Tennessee does not have registration requirements for sweepstakes or contests like Florida, New York, and Rhode Island do, but businesses must still comply with state and federal laws governing these promotions. The official rules of the sweepstakes or contest should address eligibility, entry procedures, prize descriptions, odds of winning, and how winners will be selected and notified. Additionally, businesses should be aware of the Tennessee Consumer Protection Act, which prohibits deceptive acts and practices, and ensure their promotions are transparent and fair to consumers.