Guidelines Issued by Govt. of India
Based on recommendations of an inter-Ministerial committee constituted to study the problems in direct selling, Govt. of India issued guidelines to states and union territories on 9-Sep-2016.
Guidelines
Issued by Central Govt.
A clear definition of Direct Selling and Network Marketing was
drawn in Clause-1 of this document.
Prohibition of Pyramid/Money Chain Schemes
Clause-8 of the Guidelines issued by Central Govt. reads as
given below.
It’s evident from the above clauses that
Pyramid Schemes and Money Circulation Schemes were prohibited and Direct
Selling and Network Marketing were permitted. Over and above, States and
Union Territories were advised to formulate Monitoring authorities to monitor
and regulate the activities of Direct Selling/Network Marketing entities.
Appointment of State Level Monitoring Authorities
Therefore, every state government shall
have a Monitoring Authority to monitor the activities of Direct Sellers. Issues
arising in Direct Selling shall be dealt with by the Department of Consumer
Affairs at the Union and the respective state governments.
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