Regulatory Watch: Your April brief on promotions and contest law

We’ve been tracking the latest changes in promotions and contest regulations across all the major global markets to help brands ensure compliance.

Q2 started with a flurry of regulatory changes in international sweepstakes regulations across April. Many of the new laws have already entered active enforcement and directly impact how brands structure promotions and contests.

Maine and Tennessee ban dual-currency sweepstakes

One of the most significant developments in the US last month was the ban on online dual-currency Sweepstakes in several states.

On April 6, 2026, Governor Janet Mills of Maine signed Legislative Document 2007 (LD 2007 / SP 825) “An Act Regarding the Prohibition of Online Sweepstakes Games” into law, which bans online games that allow users to purchase or receive “coins” or “tokens” through promotions. The law will take effect on July 14, 2026, giving brands 90 days to ensure their sweepstakes are compliant.

In Tennessee, the General Assembly approved Senate Bill 2136 on April 23, 2026. The legislation classifies dual-currency models in which “sweeps coins” are redeemable for prizes as illegal gambling.

Uniquely, the new Tennessee law extends liability beyond brands. Now, promoters, media partners, and even payment processors who support these sweepstakes can find themselves in trouble.

IRS major shift in prize reporting requirements

The IRS issued updates in March and April to align its prize reporting requirements with the One Big Beautiful Bill Act (OBBBA). On March 19, it issued the 2026 update to Publication 1099, officially codifying the new $2,000 threshold for prizes and winnings.

Marketers can now offer mid-tier prizes, like a $1,500 vacation or a high-end electronic device, without the burden of collecting tax information at the $600 mark.

In addition, the changes create a better experience for winners and remove a key barrier to entry for contests with smaller prizes.

Starting in 2027, the $2,000 threshold will be adjusted annually for inflation, so it’s likely to grow each year. For brands, this will result in reduced costs when running sweepstakes in the US.

FTC launches new rulemaking on the Negative Option Rule

In mid-March, the Federal Trade Commission (FTC) officially restarted the rulemaking process for its Negative Option Rule, which affects promotions with subscription rewards.

The public comment period ended on April 13, 2026, but a final rule could take 18 months or more to implement. The changes are expected to be significant for marketers of sweepstakes, promotions, and contests that lead to a recurring charge or membership.

Amended Price Marking Order (PMO) goes into effect in the UK

The UK Price Marking (Amendment) Order 2024 took effect on April 6, 2026. The law requires companies to show both the standard and the promotional, or “loyalty,” pricing. Additionally, marketers must clearly show the conditions for receiving the loyalty discount.

EU’s AI Act implementation delayed to Dec 2027

The implementation of the EU AI Act, which was passed in 2024, has been delayed by 18 months. On March 26, 2026, the European Parliament confirmed that the bill, which targets certain automated marketing and consumer profiling technology, won’t take effect until December next year.

This gives time for brands that use AI- driven tools for their campaigns to ensure compliance.

Why you should keep an eye on regulatory changes

Monitoring changes in international giveaway laws can help you avoid regulatory trouble and protect you from fines and penalties that can hurt your bottom line.

Additionally, running into trouble with regulators can ruin your hard-earned brand reputation.

Unfortunately, with many jurisdictions regularly updating their promotion laws, it’s tough for individual brands to ensure compliance with international sweepstake regulations. You can collaborate with an expert promotions agency that can help ensure compliance with ever-changing restrictions and avoid campaign bans or non-compliance fines.

Planning to launch an international sweepstakes?

At Promosfera, we can help you navigate every legal requirement effortlessly. We have 20 years of experience, and in that time, we’ve overseen over 8 million prizes in over 85 countries. You can rely on our expertise to create successful and compliant local or international campaigns in Europe and beyond.