Disallow it. Be firm but polite.

In case of genuine spammers, warn them once and then ban.

But turn that rule to your advantage. Ask people genuinely interested in promoting their site to advertise with you or exchange links. Point them out to your "links" directory page if you have one.

yeh do not allow it. period.

I disagree. I definitely think that spam should not be tolerated. Don't allow people to randomly post threads advertising their site, etc. You may wish to disallow references to other communities as replies to posts, i.e. "Didn't find what you were looking for? I heard Forum XYZ is more helpful!"

However, if you have a Site Reviews forum, I don't think you should selectively disallow community-based sites from posting there while allowing other sites. Afterall, what would define a community? Would you disallow blog sites? Forum sites? Any site with any interactivity at all? Who would be moderating all that? The next thing you know, you'll have a whole bunch of Site Reviews all showcasing plain, static HTML-based sites that haven't been updated since the '90s.

(My first post, here.)

As an owner/moderator of several different discussion groups, my main method for controlling spam was to moderate the first few messages posted by any member. It helped to determine the validity of their membership and that it wasn't some kind of bot. Then I allow a text link in their signature (much like Harishankar did in the above post), as a means to self-promote. In my world, it pays - big-time - to network. You never know where you're going to get your next lead or tidbit of assistance.

One method I've seen work fairly well on community bulletin boards is to have a separate thread, specifically for self-promotion.

Ladee

As Dani said, allowing spam is a huge no-no. Allowing self promotion in a limited way is the way forums work and should not be limited because a site may or may not compete with yours. If someone wants to come in and post a pertinent link along with content in their post; that's a great way to answer a question, who am I to try and figure out if the poster is a site owner, a site employee or just a user. Think about it from the other side, if you couldn't post your link anywhere, even if it answered a question, would you want to use that site or would you even have a site? Signatures should be even more broad -- this is where people can say who they are, again, think about it from your perspective -- you contribute to a site but you can't say where you came from? It may be fun but the purpose is reduced.

On the subject of spam -- if anyone makes a post that simply includes a link (especially if they start the thread) that is abusing your site and exploiting it. In the past we tried, that is to say, attempted, to limit commercial posts but really, it wasn't possible. Trying to figure out who owns a site and who doesn't is nearly impossible; as is figuring out what means commercial and what is just a site trying to pay hosting bills. We removed rules about who can post urls and simply limited them to responses, signatures and our marketplace forum. This has made management easier and in the end always remember the golden rule: less is more.

Having a vb fan site it would be stupid to not allow others to link to their forum.
We do not tolerate advertisement, so we have a specific "featured forums" section where users can post their url for review, comments, feedback and to show it off. If they post to advertise they get their thread removed or closed. Those who read the sticky thread (like dani did) and post it properly, are allowed to stay there.

I've been wondering to close that particular forum to guests, but currently it is still visible to guests.

Additionally, we have a links category specificly to link back to sites that link to us. In the past we added friends and sites from regulars, now our policy is to link to a site that links to us.