Decree 40/2018/ND-CP dated March 12, 2018 of the Government on management of business activities by multi-level method, stipulating, when individuals enter into contracts to participate in multi-level sales with enterprises If you sell multi-level marketing, you will officially become a participant in multi-level selling.
According to statistics, the number of people participating in multi-level sales in the period 2016 – 2020 averages around 800,000 people each year and tends to increase.
To ensure their rights and obligations as well as limit disputes with multi-level selling enterprises, multi-level sale participants should note the following 14 points of the Competition and Consumer Protection Department:
1. Basic training in multi-level selling
– After learning about the enterprise and deciding to participate in multi-level selling in that enterprise (certificated multi-level marketing enterprises are publicly posted on the website of the Department of Competition and Security). consumer protection: www.bhdc.vcca.gov.vn), participants will sign a written contract to participate in multi-level selling.
– Next, multi-level selling participants will receive basic training on multi-level selling by the multi-level selling enterprise, and this program is completely free as prescribed. This is also the responsibility of the business to perform. The purpose is to help participants understand the multi-level selling industry, the law on multi-level selling, the ethical standards in multi-level selling activities, the contract to participate in multi-level selling, the reward plan , operating rules, goods traded by the multi-level method, …
– Participants in multi-level sales must complete a basic training program and be granted a membership card of a multi-level sales network to be allowed to do multi-level selling, consulting, and introducing products and businesses to customers. , sponsor downline participants, enjoy commissions according to the reward plan. If the member has not been granted a multi-level sale network membership card, the participants are not allowed to carry out multi-level selling activities.
2. Prohibited acts for multi-level sale enterprises and multi-level sale participants
2.1. For multi-level marketing businesses
Clause 1, Article 5 of Decree No. 40/2018/ND-CP prohibits multi-level sale enterprises from performing the following acts:
– Requiring other people to deposit or pay a certain amount of money to sign a contract to participate in multi-level selling.
– Requiring other people to buy a certain amount of goods in order to sign a contract to participate in multi-level selling.
– Allowing multi-level sale participants to receive money or other economic benefits from referring others to participate in multi-level selling activities, but not from the purchase or sale of goods by that referent.
– Refuse to pay without justifiable reasons commissions, bonuses or other economic benefits to which a multi-level sale participant is entitled.
– Providing false information about the compensation plan, about the benefits of joining a multi-level sales network.
– Providing false or misleading information about the features and uses of goods or the enterprise’s activities through reporters, trainers at conferences, seminars, training or through documents of the company. enterprise.
– Maintaining more than one multi-level sale participation contract, multi-level business location, multi-level business code or other equivalent forms for the same multi-level sale participant.
– Conducting promotions using a network of many levels and branches in which the participants of the promotion program have more than one position, code or other equivalent forms.
– Organize commercial intermediary activities in accordance with the commercial law in order to serve the maintenance, expansion and development of the multi-level sales network.
– To receive or accept the application or any other form of document from the multi-level sale participant, in which the multi-level sale participant declares to waive part or all of his or her rights under the provisions of law. Decree 40/2018/ND-CP or allowing enterprises not to perform obligations towards multi-level sale participants in accordance with the provisions of Decree 40/2018/ND-CP.
– Doing business by multi-level method for those who are not allowed as prescribed in Article 4 of Decree No. 40/2018/ND-CP.
– Do not use the multi-level sale participant management system registered with the multi-level sale registration certificate authority to manage multi-level sale participants.
– Buying, selling or transferring the network of multi-level sale participants to another enterprise, except for the case of business acquisition, consolidation or merger.
2.2. For multi-level sales participants
Clause 2, Article 5 of Decree No. 40/2018/ND-CP prohibits multi-level sale participants from performing the following acts:
– Requiring other people to deposit or pay a certain amount of money to sign a contract to participate in multi-level selling.
– Providing false or misleading information about the benefits of participating in multi-level selling, features and uses of goods, and activities of multi-level selling enterprises.
– Organizing seminars, conferences, training on business by multi-level method without being authorized in writing by the multi-level marketing enterprise.
– To entice, entice and bribe other enterprises’ multi-level sale participants to join the network of the enterprise they are participating in.
– Taking advantage of their positions, powers, social and professional status to encourage, request, entice or entice others to participate in the multi-level sales network or purchase goods for business by the multi-level method. .
– Carry out multi-level selling activities in the locality where the enterprise has not been granted a certificate of registration of multi-level sale activities in the locality.
3. Membership card of multi-level sales network
Multi-level sale network membership card is a document to prove that the person named in the membership card is a multi-level sale participant of a multi-level selling enterprise and has the right to advise, market and introduce the business. a multi-level sale enterprise, its multi-level marketing products for customers and people who intend to participate in multi-level selling. Multi-level sale participants are required to present their multi-level sales network membership card before consulting, introducing and marketing products to customers.
4. Local multi-level selling activities
Multi-level selling enterprises are only allowed to conduct multi-level sale activities in their localities (provinces and cities under central authority) when they are certified in writing by the Department of Industry and Trade of the provinces or centrally-run cities on their registration. local multi-level sales activities of the enterprise. A multi-level sale participant of a multi-level selling enterprise may conduct multi-level sale only in provinces and centrally run cities when the multi-level sale enterprise has been certified in writing by the Department of Industry and Trade. registration of local multi-level selling activities of enterprises. Enterprises will be administratively fined by state agencies if they organize multi-level sales activities in provinces and centrally run cities without the written confirmation of the Department of Industry and Trade regarding the registration of multi-level sale activities. local level of the enterprise.
Multi-level sale participants will be handled by the enterprise according to the enterprise’s operating rules if the multi-level sale participants organize multi-level sale activities in the provinces and centrally-run cities when the enterprise that has not yet been granted written certification by the Department of Industry and Trade on the enterprise’s registration of multi-level selling activities in the locality. In some cases, multi-level sale participants are also sanctioned by competent state agencies when organizing multi-level sale activities in central-affiliated cities and provinces without being certified by the Department of Industry and Trade. take.
5. Conferences, seminars, training on multi-level selling
Multi-level sale participants are only allowed to organize conferences, seminars and training on multi-level selling when authorized in writing by the multi-level selling enterprise. If a participant organizes a conference, seminar or training session on multi-level selling without being authorized by the multi-level selling enterprise, the multi-level sale enterprise shall be responsible for terminating the contract of participation in multi-level sale. with that multi-level selling participant.
6. Responsibilities of multi-level selling enterprises
– To publicly post up at the head office, branch, representative office and business location of the enterprise the documents specified in Clauses 4 and 5, Article 9 of Decree No. 40/2018/ND-CP. – Strictly comply with the operating rules and the registered reward plan.
– Formulate and announce the selling prices of goods traded by the multi-level method and comply with the announced selling prices.
– Issue invoices according to each sales transaction for each multi-level sale participant of the enterprise and customers who purchase goods directly from the enterprise.
– Supervising the activities of multi-level sale participants to ensure that the multi-level sale participants strictly comply with the multi-level sale participation contracts, operating rules, and reward plans of the enterprise.
– To be responsible for the multi-level sale activities of multi-level sale participants in case such activities are carried out at the head office, branches, representative offices, business locations or at other branches. conferences, seminars, training of enterprises.
– Withhold personal income tax of multi-level sale participants to remit into the state budget before paying commissions, bonuses or other economic benefits to multi-level sale participants, except for otherwise provided by law.
– Operate the information technology system to manage the network of multi-level sale participants in accordance with the provisions of Article 44 of Decree No. 40/2018/ND-CP, in accordance with the technical explanation when registering sales activities. multi-level marketing, ensuring that MLM participants can access and retrieve basic information about their MLM activities.
– Operate and regularly update the website in Vietnamese to provide information about the enterprise and its multi-level sales activities to meet the requirements in Article 45 of Decree No. 40/2018/ND-CP .
– Operate the communication system to receive and resolve inquiries and complaints of multi-level sale participants, including phone, email and receiving address.
– Provide access to the management account of the information technology system managing the enterprise’s multi-level sales activities at the written request of the competent state management agency in charge of sales management. multi-level.
– Multi-level sale enterprises are responsible for complying with relevant legal provisions on business and circulation conditions for goods traded by the multi-level method.
7. Responsibilities of multi-level sale participants
– Multi-level sale participants only carry out marketing, sales and network development activities after being granted a Membership Card.
– Present your membership card before introducing or marketing or selling.
– Comply with the contract of participation in multi-level sales and the operating rules of the enterprise.
– Provide complete and truthful information when introducing the multi-level selling enterprise, the goods traded by the multi-level method, the reward plan and the operating rules of the multi-level selling enterprise.
8. Regulations on forwarding and sending goods for business by multi-level method
– Within 30 days from the date on which the multi-level sale participant pays the purchase amount, the multi-level sale enterprise is responsible for fully delivering the goods according to the amount paid by the multi-level sale participant and multi-level sale participants are responsible for fully receiving goods from the multi-level selling enterprise.
– In case the multi-level sale enterprise fails to deliver the goods or the multi-level sale participant does not receive the goods within the time limit specified in Clause 1, Article 46 of Decree No. 40/2018/ND-CP, the multi-level sale enterprise shall The grantor is responsible for canceling the transaction and refunding the full amount to the multi-level sale participant.
– In case a multi-level sale participant sends goods at the multi-level sale enterprise but does not receive the goods within the time limit specified in Clause 1, Article 46 of Decree No. 40/2018/ND-CP, the selling enterprise multi-level marketing is responsible for canceling the transaction and refunding the full amount to the multi-level sale participants.
9. Regulations on redemption and return of business goods by the multi-level method
– Multi-level sale participants have the right to return goods purchased from multi-level marketing enterprises, including goods purchased under promotional programs, within 30 days from the date of receipt of goods. – Returned goods must meet the following conditions:
+ Goods with original packaging, stamps and labels.
+ Enclosed with the purchase invoice number of goods requested to be returned.
– Within 30 days from the date a multi-level sale participant makes a valid request to return goods, the multi-level sale enterprise is responsible for re-purchasing the goods that satisfy the conditions specified in Clause 2 of this Article. 47 Decree No. 40/2018/ND-CP and refund according to the rate agreed with the multi-level sale participant but not less than 90% of the amount paid by the multi-level sale participant to receive such goods.
– Multi-level sale enterprises have the right to deduct commissions, bonuses and other economic benefits received by multi-level sale participants from the purchase of returned goods according to the provisions of Article 47 of the Decree. 40/2018/ND-CP.
– The multi-level sale enterprise has the right to collect from other multi-level sale participants the commissions, bonuses and other economic benefits received in relation to the returned goods according to the provisions of Article 47. Decree 40/2018/ND-CP.
– In case the contract for participation in multi-level sale is terminated, the multi-level sale enterprise is responsible for buying back the sold goods to the multi-level sale participant according to the provisions of Clauses 1, 2 and 3. Clauses 4 and 5, Article 47 of Decree No. 40/2018/ND-CP.
10. Commissions, bonuses and other economic benefits in multi-level selling
Multi-level sale enterprises are responsible for paying commissions, bonuses, promotions and other economic benefits in cash to participants of multi-level sales in the form of bank transfer.
11. Personal income tax in multi-level selling
Multi-level sale enterprises are responsible for withholding personal income tax of multi-level sale participants to remit into the state budget according to regulations.
12. Termination of contracts for participation in multi-level sales
– The multi-level sale participant has the right to terminate the multi-level sale contract by sending a written notice to the multi-level sale enterprise at least 10 working days before the termination of the contract. ”
– The multi-level sale enterprise has the right to terminate the contract with a multi-level sale participant when the multi-level sale participant violates the provisions of Article 41 of Decree No. 40/2018/ND-CP.
– The multi-level sale enterprise is responsible for terminating the contract with the multi-level sale participant when the multi-level sale participant violates the provisions of Clause 2, Article 5 of Decree No. 40/2018/ND-CP.
– Within 30 working days from the date of termination of the contract, the multi-level marketing enterprise is responsible for paying the multi-level sale participants commissions, bonuses and other economic benefits that such participants receive. Multi-level sales participants have the right to receive during the process of participating in the enterprise’s multi-level sales network.
13. The case of using the deposit of the multi-level selling enterprise
In the event that a multi-level sale participant has a dispute with a multi-level selling enterprise related to multi-level selling activities, after directly contacting the multi-level selling enterprise, they still realize their rights and their interests are not guaranteed, multi-level sale participants have the right to initiate a lawsuit to a competent court for settlement. After there is a legally effective judgment of the court on the handling of disputes between multi-level selling enterprises and multi-level sale participants related to the obligations the multi-level sale enterprises must perform to the multi-level sale participants, multi-level sale participants can send the judgment to the Department of Trade and Industry Protection and Trade for settlement using the deposit in accordance with the provisions of Article 53 of Decree No. 40/2018/ND-CP.
14. Ethical Business
The Department of Consumer Protection and Trade urges multi-level selling enterprises and multi-level sale participants to conduct business ethically, encourages businesses to develop a Common Code of Ethics and requires multi-level sale participants to practice ethical conduct. strictly complying with that Rule in order to build a fair and healthy business environment, contributing to the building of a positive development of the multi-level marketing industry.
Source: https://moit.gov.vn/tin-tuc/bao-chi-voi-nganh-cong-thuong/nguoi-tham-gia-ban-hang-da-cap-can-luu-y-14- diem-duoi-day.html
