Direct-selling companies seek clarity on norms, definition

New Delhi:In order to get legal sanctity and recognition from both central and state government authorities, the Indian arm of global direct sellers like Tupperware, Amway, Oriflame and their lobby arm IDSA may soon approach the commerce ministry. The Rs 7,000-crore direct selling industry, with 18 national players, are pushing for a clear definition of “direct sellers” and distinction from multi-level marketing entities, including those dealing in money circulation schemes.

Sources said Amway representatives in the US are planning to meet commerce minister Anand Sharma, who is currently on an official visit to that country, to pursue the matter.

“We will prepare a strategy paper and approach the commerce ministry very soon. Our proposals of own set of strict guidelines for distinguishing genuine direct sellers from the rest are being studied by the finance ministry. We are hopeful that something positive may come out in a month’s time,” Chavi Hemanth, secretary-general of the Indian Direct Selling Association said.

However, government sources indicated that both the consumer affairs ministry and the department of financial services are against exclusion of direct selling entities such as Tupperware, Amway and others from the ambit of Prize, Chit Funds and Money Circulation (Banning) Act, 1978. Both are currently examining the link between illegal money-making schemes, including ponzi schemes, pyramid schemes and those promoted by the multi-level marketing firms.

Sources in the consumer affairs ministry are of the view that instead of a central regulator or a central law, these direct selling entities should be subjected

Leave a Reply

Your email address will not be published. Required fields are marked *