Direct Selling Professionals Demand Legislation for the Industry in India #IndianMLMLaw 

An estimated 5.8 million people in India are involved in the Direct Selling industry that generated about Rs.7200 crores in 2014. The industry is expected to touch Rs 64,500 crores by 2025 according to a recent report by the Federation of Indian Chambers of Commerce and Industry (FICCI) in partnership with international accounting firm KPMG India.

We are a group of direct selling professionals who have managed to change our lives and the lives of many others, thanks to the opportunity provided by this industry. We are independent representatives of leading Asian direct selling company QNET in India.

For the last 3 years, QNET has been in the news for all the wrong reasons. The Economics Offences Wing in Mumbai has been investigating QNET in India for nearly 3 years and is yet to file a charge sheet. While investigations are ongoing, the company has been subjected to a trial by the media fueled by baseless allegations made by self-styled activist Gurupreet Singh and former financial journalist Sucheta Dalal of Moneylife.

Gurupreet Singh, an individual of dubious character has previously been charged with domestic violence for beating up his aged father and injuring him grievously. In our research, we also found an FIR against him for seeking out young girls on the internet for sexual activities.

This same Gurupreet Singh has been claiming that his wife was cheated by QNET and was forced to purchase a product that proved to be useless. QNET has provided enough evidence to show that his wife never entered into any financial transaction with the company. While it is true that she was approached by some IRs of QNET, she initially placed an order for an e-learning course but stopped payment to the cheque and no financial transaction has taken place.

Ms.Dalal on the other hand, has been crusading against QNET almost with a fanatic zeal without giving the company any opportunity to present its side of the story, the way an ethical journalist or news organization would do. After initial attempts by QNET to present her with facts turned into her twisting everything she was given into a negative spin, the company refused to engage her any further.

We recently came across an investigation by NSEL investors’ action Group that exposes the shady role Ms.Dalal plays in the 5600 crores NSEL Scam.

With individuals such as these involved in tarnishing the name of the company through the media, and an investigation that has dragged on for several years, the reputation of not just the company, but the direct selling industry itself has been brought into question.

The absence of specific legislation in India for Direct Selling and the misuse of the Prize Chits and Money Circulation (Banning) Act to charge QNET and other companies in the direct selling industry, as well as individual distributors is highly irregular.

Direct Selling is a proven economic driver in many countries around the world. When regulated with the appropriate laws, the industry has flourished and contributed positive to the socio-economic growth of countries such as Singapore, Malaysia, Taiwan, Philippines and the US, where the industry first began. Even our neighbours in Bangladesh have recognized the power of the direct selling industry and passed the Multi Level Marketing (Control) Act in 2013. Direct selling emerged in India in the 90s and in the last 20+ years has benefited thousands of Indians with economic and personal growth.

Despite the lack of clarity in the definition of the business under the law in India the industry has thrived and grown at a steadily increasing rate. In 2014-15 the Indian direct selling industry registered a 6.5 per cent growth.

Recent untoward incidents in terms of unwanted harassment (including imprisonment) and other related investigations have severely impacted and shaken confidence of not only the Direct Selling players but of consumers too.

We, as independent network marketing professionals who are part of the billion dollar industry in India petition the government to form a legislation for the direct selling industry to help distinguish between money circulation schemes and legitimate direct selling. This will not only help save the livelihood of millions of Indians who have been contributing to the economy but help the government crack down on unscrupulous operators, while giving genuine companies a clear framework to operate within.

Please sign the petition to support the demand for a clear and fair regulation for Direct Selling to protect both legitimate companies as well as consumers, and stop the harassment by unscrupulous individuals with vested interests.

In order to protect this strong system of channelizing human resources towards nation building, we require –

1. A clear definition of Direct Selling as defined by the Government
2. Revision of the Prize Chits and Money Circulation (Banning) Act to include a clearer definition of Chit fund and exclude legitimate, product-based, direct selling companies from it.
3. A government authorised regulation or regulatory body for Direct Selling business in India