Ministry of Consumer Affairs invites SUGGESTIONS for Consumer Protection Rules (Direct Selling) 2021 - Check everything you need to know

Consumer Protection Rules 2021: The Union Ministry of Consumer Affairs has issued the Draft for Consumer Protection Rules (Direct Selling) 2021. The ministry is inviting suggestions from the public and stakeholders on the Consumer Protection Rules for Direct Selling. It must be noted that the last date of submission of suggestion is July 21, 2021. The views and suggestions can be sent via e-mail to js-ca@nic.in.

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The scope and availability of the Consumer Protection Rules (Direct Selling) 2021 are as follows:  

1) Save as otherwise expressly provided by the central government by notification, these rules will apply to:

a) All goods and services brought or sold through direct selling

b) All models of direct selling

c) All direct selling entities offering goods and services to consumers in India

d) All forms of unfair trade practices across all models of direct selling

2) Notwithstanding anything contained in sub-rule, these rules will apply to a direct selling entity which is not established in India but offers goods or services to consumers in India

3) The existing direct selling entities will comply with these rules within 90 days of its publication in the official gazette

The biggest points in Direct Selling are as follows:

1) Any entity dealing or carrying the Direct Selling exercises in India has to mandatorily register itself in India with Department for Promotion of Industry and Internal Trade (DPIIT)

2) The prohibition of pyramid scheme and money circulation scheme

It has to be noted that 'direct selling entity' refers to an entity which is not engaged in a pyramid scheme and/ or money circulation scheme. It sells or offers to sell goods or services through direct sellers.

The 'direct selling network' refers to a network of direct sellers formed by a direct selling entity and includes a multi layered network of direct sellers in which direct sellers introduce of sponsor further levels of direct sellers and support them in order to receive any benefit. Such benefits are solely as a result of sale of goods and services.