Can I offer contests that involve travel prizes in Texas? What are the requirements?

To offer contests that involve travel prizes in Texas, you must comply with the requirements set forth in Tex. Bus. & Com. Section 621.104 and Tex. Bus. & Com. Section 621.103.

Requirements for Matched Contest

Tex. Bus. & Com. Section 621.103 states that the identity and number of the major prizes to be awarded in a matched contest must be determined before the contest begins and disclosed on each entry form distributed. Each major prize identified on an entry form for a matched contest shall be awarded. The contest period for a matched contest may not exceed 12 calendar months. If, during the contest period for a matched contest, a winning number is not presented or matched for a major prize, the offeror shall conduct a drawing from the names of those individuals who attended a sales presentation during the contest period. The offeror shall conduct the drawing not later than the 60th day after the date the contest period ends. Each major prize identified on the entry forms distributed during the contest period that was not previously awarded shall be awarded at the time of the drawing.

Required Disclosures Relating to Matched Contest

Tex. Bus. & Com. Section 621.104 requires that a person who uses a matched contest shall clearly and conspicuously disclose in writing in the offer: (1) that attendance at a sales presentation is required; (2) the name and street address of the person who is soliciting attendance at a sales presentation; (3) a description of the product or service being sold; (4) each requirement, restriction, qualification, and other condition that must be satisfied for a person to enter the contest, including: (A) any deadline by which the person must visit the location or attend the sales presentation to qualify to receive a prize; and (B) the approximate duration of the sales presentation; (5) a statement of the odds of winning each prize offered, expressed as a ratio in Arabic numerals; (6) the geographical area or states in which the contest will be conducted; (7) the beginning and ending dates of the contest period; (8) the identity and address of each person responsible for awarding prizes; (9) that all unclaimed prizes will be awarded by a drawing and the date of the drawing; and (10) all other rules and terms of the contest. A person engaged in the preparation, promotion, sale, distribution, or use of a matched contest shall disclose: (1) the retail value of a prize; and (2) clearly and conspicuously in at least 10-point type that airfare, lodging, or both are not included as part of a prize that is a trip or recreational activity to the extent that either or both are not included.

State of Texas Travel Guidance

Tex. Bus. & Com. Section 621.108 prohibits an offeror from notifying a person that the person has won a prize, will receive a prize, or has a chance to win or receive a prize if the receipt of the prize is conditioned on the person paying consideration of any kind, paying a charge, or incurring an expense. However, an offeror may notify a person that the person has won a prize, will receive a prize, or has a chance to receive a prize that is conditioned on the person paying expenses incurred for travel to and from the sales location.

Tex. Bus. & Com. Section 621.102 requires that an offeror who notifies a person that the person has won a prize, will receive a prize, or has a chance to win or receive a prize shall, at the time of the notification, clearly and conspicuously disclose that attendance at a sales presentation is required, the approximate duration of the sales presentation, and a description of the product or service being sold.

Therefore, to offer contests that involve travel prizes in Texas, you must comply with the requirements set forth in Tex. Bus. & Com. Section 621.104, Tex. Bus. & Com. Section 621.103, Tex. Bus. & Com. Section 621.108, and Tex. Bus. & Com. Section 621.102.

Jurisdiction

Texas

• Gaming