Sweepstake and Contest Laws

Laws and Rules for Sweepstakes in Oklahoma

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.

Oklahoma (OK)

If your promotion involves free and paid entries, the state of Oklahoma says free entries must be drawn from the same pool and in the same way. In other words, there must be an equal chance to win for all.

In other words: all entries, free or based on purchases, must be combined into one list and winner drawing must be from that one combined list.

Contests: are allowed as long as the sponsor awards the prize based on skill and not chance.

Sweepstakes: are allowed as long as the sponsor awards the prize based on chance.

Prize Promotion Laws- Oklahoma Consumer Disclosure of Prizes and Gifts Act

• In Oklahoma, it's illegal to notify a person that they have won a prize and that that person must pay money or rent any goods or services in order to receive that prize. This also includes asking the winner to pay unreasonable shipping and handling charges in order to receive the prize.

Prize Promotion Laws- Oklahoma Commercial Telephone Solicitation Laws

• In Oklahoma’s telephone solicitor’s law, the telemarketing companies must register the promotion with the Office of the Attorney General.
• In Oklahoma, telemarketing companies disclose the prize offer material terms to the participant.
• Oklahoma prohibits misrepresentation that a person has won or will receive a prize.

Legal Review Criteria: Material Element Test 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.