Vietnam: Failing to make the list of trainers when doing multi-level marketing shall be fined up to VND 40 million

This is a notable content of the Decree No. 98/2020/NĐ-CP of Vietnam’s Government prescribing penalties for administrative violations against regulations on commerce, production and trade in counterfeit and prohibited goods, and protection of consumer rights, effective from October 15, 2020.

không cập nhật DS đào tạo viên khi kinh doanh đa cấp, Nghị định 98/2020/NĐ-CP

According to Clause 6 Article 73 of the Decree No. 98/2020/NĐ-CP of Vietnam’s Government, a fine ranging from VND 30.000.000 to VND 40.000.000 shall be imposed upon a MLM company for committing one of the following violations:

- Failing to carry out or improperly carrying out procedures for modification of the MLM registration certificate as prescribed by law;

- Failing to carry out or improperly carrying out procedures for notification of changes in the list of products sold through the MLM network as prescribed by law;

- Failing to carry out procedures for re-issuance of the MLM registration certificate in cases prescribed by law; 

- Signing MLM contracts with individuals who fail to fulfill eligibility requirements for participants in the MLM as prescribed by law;

- Signing a MLM contract which does not contain adequate primary contents as prescribed by law;

- Failing to terminate the MLM contract signed with the participant who is penalized for committing prohibited acts in the MLM sector;

- Failing to implement or improperly implementing the regulation that the MLM company must make and publish the list of trainers on its website, submit the one to the Ministry of Industry and Trade, and keep relevant documents;

- Failing to implement or improperly implementing the regulation that the MLM company must update the list of trainers on its website and send the updated list of trainers to the Ministry of Industry and Trade upon occurrence of any changes in that list;

- Failing to implement or improperly implementing regulations on publishing of documents concerning the MLM company’s operation and products at its head office, branches, representative offices and business locations;

- Failing to set up and announce the prices of products sold through the MLM model or failing to sell products at the announced prices;

- Failing to supervise participants in its MLM network so as to ensure that they strictly comply with the signed MLM contracts, the company's business rules and compensation plan;

- Failing to implement or improperly implementing regulations on registration of modification of or supplements to registered MLM activities carried out in a province with the Provincial Department of Industry and Trade in cases prescribed by law;

- Failing to give a written notification to the Provincial Department of Industry and Trade of failure to organize the conference, meeting or training course which has been notified to the Provincial Department of Industry and Trade;

- Failing to carry out procedures for modification of the written deposit confirmation with the bank upon occurrence of changes in confirmed deposit contents;

- Failing to comply with the prescribed time limit for completing procedures for renewal of a MLM registration certificate;

- Failing to promptly report the failure of the information technology system used for managing participants in the MLM network to the authority issuing the MLM registration certificate;

- Failing to implement or improperly implementing regulations on retention and submission of documents concerning the MLM activities carried out in a province at the request of competent authorities;

- Failing to implement or improperly implementing regulations on reporting on MLM activities.

View more details at the Decree No. 98/2020/NĐ-CP of Vietnam’s Government, effective from October 15, 2020.

Le Vy

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