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 Washington State, businesses that want to run sweepstakes or contests must comply with both state and federal regulations to ensure their promotions are not considered illegal lotteries. An illegal lottery includes three elements: prize, chance, and consideration (entry fee or purchase requirement). To avoid being classified as a lottery, most sweepstakes remove the consideration element by allowing free entry. Washington law requires that sweepstakes and contests have clear and conspicuous terms and conditions, and businesses must avoid any deceptive practices. While Washington does not have the same registration requirements as Florida, New York, or Rhode Island for sweepstakes, businesses must still adhere to the state's promotional laws. The official rules for the sweepstakes or contest should address eligibility, entry procedures, prize descriptions, odds of winning, and how winners will be selected and notified. It's advisable for businesses to consult with an attorney to ensure compliance with all applicable laws when structuring such promotions.