logo

Myanmar: Draft direct selling law will regulate MLMs: govt

The Myanmar government is set to regulate multi-level marketing (MLM) companies through a new legislation.

U Myint Lwin, director general for Department of Consumer Affair, told this newspaper that the draft Direct Selling Law will put forward a regulatory framework for those firms.

The department is responsible for the new legislation and the draft law has been made public.

MLM businesses, also called network-marketing or direct-sales companies, often sell products by employing a network of distributors.

In September 2018, the government issued a notification to prohibit MLMs after the Ministry of Commerce found that many consumers have fallen victim to those strategies. Hence, MLM businesses have been banned over a year ago in the domestic market by the Essential Supplies and Services Law.

“In the past, the government had banned businesses which are distributed by multi-level marketing. According to the draft Direct Selling Law, businesses which are distributed by multi-level marketing [strategies] could work within the legal framework,’’ said U Myint Lwin.

The draft law defines direct sales as the selling of goods or services either by meeting in person or ordering or communicating via an electronic system to the consumers, and aims to strengthen consumer protection and awareness, as well as oversight in this area.

Businesses that fall under the definition must register with the Department of Consumer Affairs under the commerce ministry, according to the legislation. Failure to comply could result in a maximum of a two-year imprisonment and/ or a penalty of K300 million.

Source: https://www.mmtimes.com/news/draft-direct-selling-law-will-regulate-mlms-govt.html