Tightening regulations on MLM (multi-level marketing) Overseas / Vietnam
In March 2018, the Vietnamese government issued Decree 40/2018 / ND-CP, which replaces Decree 42/2014 / ND-CP, regarding Multi-Level Marketing (MLM). Decree 40 is already valid and companies must meet all the conditions under ND Decree 40.
MLM registration application documents
With the registration certificate application, the MLM company must submit the following documents:
Copy of company registration certificate
Personal identification documents for partners/founding shareholders/owners
Details of target products
IT infrastructure for managing participant networks
A document certifying that the MLM company has a website
Details of information and communication system for complaint processing
Materials related to the award plan
Documents about business details
Training program materials
Contract document
MLM registration conditions
The MLM registration certificate is valid for 5 years from the date of issue and can be extended. MLM companies must meet certain conditions before registering in Vietnam.
Company established in Vietnam
Registered capital is over $430,000
Contracts, operating rules, rewards, and training content in line with Cabinet Order 40
Information communication system for complaint handling
MLM restriction activities
Under Decree No. 40, some activities are prohibited or restricted to ensure a transparent and fair environment for companies and participants.
Merchandise prohibited by MLM
Pharmaceuticals, medical devices, digital content products, and chemical products are prohibited from handling at MLM.
MLM product quality
Businesses and participants should ensure that the products sold are not counterfeit or non-standard quality.
Sale of MLM network
MLM companies cannot sell or transfer their network of participants to other companies.
Information about MLM benefits
Company and participants are required not to provide false or misleading information about the awards, benefits, fees and features offered by the company.
Hold MLM seminars and training
Companies may not hold seminars or training sessions for existing or new participants without the permission of the government authorities.
Obligations of MLM companies
MLM Companies shall not impose any obligations on Participants. You also cannot demand that you waive your rights within the network.
Half-year reporting obligations of MLM companies
Under Decree No. 40, MLM companies are required to submit a report every six months to the Ministry of Industry and Trade and the State/Municipal Bureau of Industry and Trade.
MLM companies need to provide information about networks, revenue, business activities, compensation, taxes, promotion plans, seminars and training sessions.
MLM penalties
Over the past few years, the Vietnamese government has fined numerous MLM companies in Vietnam and has expired their licenses due to fraud and tax law violations. Decree No. 40 is expected to help minimize fraud, protect the rights of participants and strengthen government oversight.
How to establish an MLM company in Vietnam
So far, I've covered how to set up a company in Vietnam.
Investment in Vietnam is Ho Chi Minh Suzuki Real Estate
We support rental and purchase of condominiums, offices and investment real estate, mainly in Ho Chi Minh, Vietnam.
Our strength is to provide buyers with accurate and accurate information in a timely manner.
This website introduces the latest news articles on real estate, economy, travel, and events related to Vietnam. Based on my experience as a consultant in Hong Kong, the article also introduces real estate, management, accounting, tax, and labor affairs. If you like, please take a look.
