Resolutely rectify multi-level marketing activities

According to data from the National Competition Commission (Ministry of Industry and Trade), there are currently 20 enterprises (DN) with certificates of registration for multi-level marketing activities operating nationwide. In recent years, the Ministry of Industry and Trade has drastically and synchronously implemented solutions to manage multi-level marketing activities from the central to local levels, in particular rectifying and ensuring that multi-level marketing activities take place within the legal framework, preventing as much as possible negative consequences for the people.

Multi-level marketing is a sensitive activity that can easily be transformed into fraudulent models and property appropriation. (Illustration photo)

In 2023 alone, the total number of people participating in multi-level marketing was 768,283. Total revenue from the multi-level marketing industry reached about 16,866 billion VND, total commissions and economic benefits paid to multi-level marketing participants reached about 5,846 billion VND, total taxes paid to the state budget was about 2,255 billion VND.

However, in 2023, through inspections and controls, the Ministry of Industry and Trade imposed administrative penalties on 5 enterprises and 1 individual participating in multi-level marketing, with a total fine of VND 1,115 billion. Information on handling violations in multi-level marketing activities is publicly announced in the media.

With strict control over multi-level marketing activities of licensed enterprises, currently, illegal activities tend to switch to disguised forms, taking advantage of multi-level marketing models to defraud and profit, leading to increasingly complicated developments. Although this group of subjects is strictly prohibited by law and is not under the management scope, the Ministry of Industry and Trade has also taken drastic measures to prevent and minimize damage to the people. Along with information, propaganda and warning work to raise people's awareness of the manifestations of multi-level marketing in disguise, the Ministry of Industry and Trade has also coordinated with relevant ministries, branches and forces, especially the police, to strictly handle violations, enhance deterrence and prevent early negative consequences for society.

In Thanh Hoa, according to statistics from the Department of Industry and Trade, there are currently 16 enterprises in the province that have been confirmed to register for multi-level marketing activities locally, with nearly 25,000 participants. In recent times, the State management of multi-level marketing activities has always been of interest to sectors and localities, ensuring compliance with legal regulations, especially after Thanh Hoa implemented the Project to improve the effectiveness of State management in multi-level marketing activities in Thanh Hoa province, period 2021-2025.

On the part of the Department of Industry and Trade, from 2022 to present, the unit has increased propaganda in various forms, suitable to the conditions and actual situation to disseminate information, raise awareness of enterprises and units in strictly complying with the provisions of the law in the process of implementing trade promotion activities, product promotion, promotional forms... in accordance with the provisions of Decree No. 81/2018/ND-CP dated May 22, 2018 of the Government and current regulations of the State. At the same time, warn all classes of people about the forms of taking advantage of promotional sales to make illegal profits, defraud consumers; inform and propagate about the signs of illegal advertising, sales, and multi-level marketing so that people know and raise vigilance, have the awareness to protect their own rights; Strengthen State management of activities of organizing conferences, sales seminars, product introductions along with implementing promotional programs of enterprises in localities in the province in accordance with the provisions of law.

In particular, from 2022 to present, the unit has coordinated with sectors and localities to organize conferences to propagate and disseminate laws on multi-level business, and identify signs of illegal multi-level sales for more than 4,000 officials, civil servants and people in the province.

The Department of Information and Communications has compiled, printed, and distributed more than 18,000 leaflets promoting multi-level marketing activities; compiled more than 3,000 handbooks on the law on multi-level marketing activities. Media agencies have published many news and articles reflecting on multi-level marketing activities.

In 2023, the National Assembly issued the Law on Consumer Protection, which codified regulations on the management of multi-level marketing activities; the Government issued Decree No. 18/2023/ND-CP amending and supplementing a number of articles of Decree No. 40/2018/ND-CP on the management of multi-level marketing activities. In 2024, the Government continued to issue Decree No. 55/2024/ND-CP detailing a number of articles of the Law on Consumer Protection, including regulations on the management of multi-level marketing activities.

Based on the proposal of the Ministry of Industry and Trade, the Government also submitted to the National Assembly to supplement Article 217a of the 2017 Penal Code on the crime of violating regulations on management of multi-level business activities, creating a legal basis for early detection and handling of fraud cases taking advantage of the multi-level business model, avoiding too great damage and only when there is a complaint can it be handled according to the crime of fraud and appropriation of property.

With new, more drastic legal corridors, it will create a basis for timely inspection, examination, and handling of violations, with penalties that are sufficiently deterrent to effectively prevent violations.

Tung Lam

Source: https://baothanhhoa.vn/quyet-liet-chan-chinh-hoat-dong-ban-hang-da-cap-217983.htm