Penal Code section 337o
(a)
It is unlawful for any person or entity to operate, conduct, or offer an online sweepstakes game in this state.(b)
It is unlawful for any entity, financial institution, payment processor, geolocation provider, gaming content supplier, platform provider, or media affiliate to knowingly and willfully support directly or indirectly the operation, conduct, or promotion of an online sweepstakes game within this state.(c)
For purposes of this section, the following definitions apply:(1)
“Direct consideration” means a coin, token, or other representation of value that may be purchased by a player or received through a bonus or promotion and that is used for playing or participating in the online sweepstakes game.(2)
“Indirect consideration” means a coin, token, or other representation of value that may be exchanged for a prize, award, cash, or cash equivalents or a chance to win a prize, award, cash, or cash equivalents. Indirect consideration is provided for free through a promotion, bonus, or with the purchase of a related product, service, or activity. As used in this paragraph, “related product, service, or activity” includes a coin, token, or other representation of value that may be used for direct consideration.(3)
“Online sweepstakes game” means a game, contest, or promotion that meets all of the following conditions:(A)
Available on the internet or accessible on a mobile phone, computer terminal, or similar device.(B)
Utilizes a dual-currency system of payment that allows a person to play or participate with direct consideration or indirect consideration, and for which the person playing or participating may become eligible for a prize, award, cash, or cash equivalents or a chance to win a prize, award, cash, or cash equivalents.(C)
Simulates gambling, which, for purposes of this section, includes, but is not limited to, any of the following:(i)
Slot machines.(ii)
Video poker.(iv)
Lotteries, as defined in Section 319.(v)
Bingo.(vi)
Sports wagering.(D)
Awards cash or cash equivalents.(d)
A person who violates this section is guilty of a misdemeanor and shall be punishable by a fine not less than one thousand dollars ($1,000) nor more than twenty-five thousand dollars ($25,000), or by imprisonment in the county jail not exceeding one year, or by both the fine and imprisonment.(e)
This section does not make unlawful or otherwise restrict lawful games and methods used by a gambling enterprise licensed under the Gambling Control Act or operations of the California State Lottery.(f)
This section does not make unlawful game promotions or sweepstakes conducted by for-profit commercial entities on a limited and occasional basis as an advertising and marketing tool that are incidental to substantial bona fide sales of consumer products or services and that are not intended to provide a vehicle for the establishment of ongoing gambling or gaming.
Source:
Section 337o, https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=PEN§ionNum=337o. (updated Jan. 1, 2026; accessed Dec. 15, 2025).
