Issuance of Direct sales licenses temporarily stopped
Issuance of Direct sales licenses temporarily stopped
The Ministry of Industry and Commerce has issued a notification to temporarily cease the issuance licenses for direct sale businesses across the country after concerns from the public.
The ministry will revise regulations on direct sale business to be more concise and in close concert with best practice before permitting direct sale business to operate in the future.
Previously, Ministry of Industry and Commerce issued a Decision on Direct Sale Business in January 2017 to define principles, regulations, and measures in administering direct sale businesses.
It did so aiming to facilitate the buying and selling of goods in the society, so as to protect national benefits and consumer interests, independent sellers, direct sale agents and direct sale business operators.
When the decision had become officially effective, the ministry found that it was not concise enough and it was inconsistent with the actual practice which creates gaps for fraud and deception at the hands of errant domestic and foreign operators.
There were numbers of import companies claiming that they are able to bring foreign investors to support direct sale business and promised to generate huge returns for local partners.
Participants in such schemes are generally required to pay membership fees monthly in order to join.
At the end of the year, the company promises to share benefits from the sales.
However, in practice, investing in such schemes is high risk and affects some people who took part in such activity as they might not be able to claim back their loss or any compensation if a fraud takes place.
Recognising the seriousness of the issue, the Ministry of Industry and Commerce has acted on concerns in support of the welfare of the nation’s consumers and households.
