The draft Decree amending and adding some articles of Decree 40/2018/ND-CP on multi-level business management has been developed by the Ministry of Industry and Trade and is being consulted with relevant domestic and foreign agencies, organizations and individuals for six major amendments and additions.

Illustrative Photo: Internet

First, supplementing and clarifying regulations on the conditions for registration of multi-level selling activities, in which addinga condition that foreign investors registering for multi-level selling activities in Vietnam must have three consecutive years of experience in multi-level marketing activities in another country;

Second, revising down the required basic training time, revising the training contents to suit reality;

Third, clarifyingcases eligible for using deposits to ensure the interests of participants, thereby helping people to clearly understand their rights before proceeding with legal procedures, limiting the time for the people and the government in settlement of disputes and use of deposit;

Fourth, effectively promoting local management by clarifying conditions and responsibilities of local representatives of enterprises; ensuring that the local representative must be the person who understands the activities of the enterprise in the locality and has the full authority and responsibility to work with the local competent authority upon request;

Fifth, improving the transparency in the operation of multi-level marketing enterprises by adjusting the international sponsorship mechanism, preventing illegal activities or gaining illicit profits from the Vietnamese market;

Sixth, adding regulations on the minimum commission rate on participants' personal sales to encourage businesses to promote participants' sales, limiting the risk of modified multi-level business model that only recruits and sell goods within the system.

In addition, the Ministry of Industry and Trade also proposed to amend several specific regulations and administrative procedures to ensure consistency and convenience in implementation.

Previously, on March 12, 2018, the Government issued Decree No. 40/2018/ND-CP on managing the multi-level business model and creating a stricter and more effective management mechanism for business activities with many complicated manifestations.

After more than three years of implementation, Decree 40/2018/ND-CP has helped the Government better manage multi-level business activities.

Genuine businesses also benefit by purging illegal or poorly-performing businesses.

Moreover, through the management of multi-level business activities, state management agencies at all levels realize that the legal regulations still need to be revised and further improved toboost transparency in multi-level business activities and improve the efficiency of state management and ensure the consistency and ease of each regulation.

Therefore, on the basis of a survey of opinions of localities, the Ministry of Industry and Trade proposed and was assigned by the Prime Minister to assume the prime responsibility for developing a Decree amending and supplementing a number of articles of Decree 40/2018/ND-CP multi-level business management.