MLM Software Guideline
Definitions Direct Selling Business
Direct Selling: Means marketing or sales of goods directly to the end user consumer using word of mouth publicity, display and/or demonstrations of the goods/products, and/or distribution of pamphlets. Explanation: Companies can open pick up points and delivery points for maintaining effective delivery system.
Direct Selling
Consumer
Sales Incentives
Conditions for Permissible Direct Selling
Direct Selling: Means marketing or sales of goods directly to the end user consumer using word of mouth publicity, display and/or demonstrations of the goods/products, and/or distribution of pamphlets. Explanation: Companies can open pick up points and delivery points for maintaining effective delivery system.
Appointments
Direct Selling Entity shall appoint/authorise Direct Sellers upon receipt and scrutiny of application in a prescribed format. An agreement recording terms of such appointment should be executed between the Direct Selling Entity and Direct Seller. No application should be considered unless such applicant is eligible to enter into a contract under the Indian Contract Act. Each Direct Seller shall be allotted Unique Identification Numbers before granting license/permission to start Direct selling. Direct Selling Entity should not give incentive to any persons for joining of Direct Sellers.
Prohibition
Payment of incentive by whatever name it is called unrelated to their respective sales volume. Supply/Distribution of goods with the knowledge that such goods/products are inferior or exceeded its validity period as per the manufacturer. Direct Selling Entity/Direct Seller will not indulge in money circulation scheme or any act barred by the Prize Chits and Money Circulation Scheme (Banning) Act, I978.