For many years, we have been advising our clients that, in addition to the laws addressing sweepstakes and contest promotions, they must also be aware of the Facebook’s promotion guidelines if they wished to link their sweepstakes promotion to the company Facebook presence. While that remains true, Facebook has now made it much easier for companies to run promotions through Facebook. Prior to Facebook changing the terms of their guidelines on Aug. 27, promotions were not allowed to be run directly through Facebook or Facebook’s functionality. Instead, running a contest or sweepstakes promotion required companies to use a third-party (or in-house created) application run on Facebook’s platform. Facebook posted an announcement of the changes which also explained some of the remaining limitations (such as prohibitions in the new guidelines against encouraging inaccurate tagging for purposes of a promotion). The amended guidelines also include certain other requirements with respect to clarifications that Facebook is not a sponsor of and does not endorse the promotion and a release of Facebook from all liability.

Whether a company would be wise to take advantage of this new freedom depends in part on a number of factors — including the nature and complexity of the promotion, the notoriety of the particular company and anticipated participation. It may prove extremely difficult to reasonably and fairly sort through thousands of entries without running them through some kind of application in order to verify, count, review or otherwise manage the entries. Further, running the promotion directly through Facebook might be more likely than usual to result in a flood of negative comments should the promotion encounter an administrative difficulty or even just from sore losers.

It will be interesting to see how companies take advantage of this change in Facebook’s guidelines, how Facebook uses this change to its own advantage, and what new perils companies might face in administering contest and promotions through Facebook.