The Government of India, Ministry of Consumer Affairs, Food and Public Distribution, Department of Consumer Affairs have issued the model framework for guidelines on Direct Selling/MLM. These guidelines are known as the Direct Selling Guidelines 2016. These are issued vide F. No. 21/18/2014 - IT (Vol-II) dated 9th September, 2016 and published in the Extraordinary Gazette of India.
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Based on the consultation with the Inter-Ministerial Committee and Stakeholders, the model guidelines for States & Union Territories, on direct selling, have been formulated for protecting the legitimate rights and interests of Industry and Consumers.
These Guidelines are issued as guiding principles for the State Government to regulate the business of “Direct Selling” and “Multi-Level Marketing (MLM)”. Being enforcement agencies, the State Governments will also set up a mechanism to monitor/supervise the activities of Direct Sellers and Direct Selling Entity regarding compliance of these guidelines.
Any direct selling entity conducting direct selling activities is required to submit an undertaking to the Department of Consumer Affairs stating that it is in compliance with these MLM guidelines and shall also provide details of its incorporation.
The Nodal department to deal with the issues related to Direct Selling will be the Department of Consumer Affairs at the Union and the respective State Governments in the States.