New Delhi [India], December 13 : The Central Consumer Protection Authority (CCPA) has issued notice to 17 companies that were found violating Consumer Protection (Direct Selling) Rules, 2021, the Ministry of Consumer Affairs, Food & Public Distribution said in a release.
The ministry added in the release that currently 13 of these cases are under investigation, while replies from three companies are awaited.
As a part of its commitment to uphold consumer rights, CCPA has intensified its focus on regulating direct selling activities and ensuring compliance with relevant legal framework.
In this regard, the authority carefully examined the websites of these direct selling entities, the ministry added.
Direct selling is a method of marketing, distribution and sale of goods or services directly to consumers, away from fixed retail premises.
This method relies on independent representatives of the entity, known as direct sellers, selling products directly to customers, typically through personal contact, online platforms, or home presentations.
Ethical direct selling businesses operate transparently, providing quality products and fair compensation for their representatives without misleading consumers.
The Government of India notified the Consumer Protection (Direct Selling) Rules, 2021, establishing a comprehensive framework to regulate direct selling entities and protect consumer interests. These rules aim to promote transparency, accountability, and ethical practices within the direct selling industry, enabling consumers to make informed decisions.
Additionally, the rules complement other regulatory frameworks, including the Consumer Protection (E-Commerce) Rules, 2020 and the Legal Metrology (Packaged Commodities) Rules, 2011 further strengthening consumer protection mechanisms.
However, some fraudulent entities misuse the direct selling model to promote illegal pyramid or money circulation schemes. These entities often make unrealistic promises of high commissions, foreign trips, entrepreurship, high returns and wealthy future, contingent on recruiting others, which violates consumer trust and established laws, thereby exposing consumers to fraudulent pyramid and money circulation schemes.
This is a significant move by the ministry as through these notices is trying to stop the the unfair trade practices, service deficiencies, and violations of the Consumer Protection.
Vihaan Direct Selling (India) Pvt Ltd (a sub-franchise of QNet Group, Hong Kong), Triptales Pvt Ltd, Oriens Global Marketing Pvt Ltd, Zennesa Wellness Pvt Ltd, Orgolife Solutions Pvt Ltd, Oriflame India Pvt Ltd, Juncture Marketing Pvt Ltd, Wolte Marketing Pvt Ltd, Preet Life Care Pvt Ltd, Enroots Horizon Pvt Ltd, E biotorium network Pvt Ltd, Meghdoot Marketing Pvt Ltd, Suii Dhaaga Lifestyle Pvt Ltd, Winmarg Business Pvt Ltd, Ayusratna Natural Herbal Pvt Ltd, Biothon Lifecare Pvt Ltd, and Okflip India Pvt Ltd are the companies who are given the notices.
The action aims to address concerns about deceptive and exploitative practices in the direct selling industry and ensure adherence to the regulatory framework designed to safeguard consumer interests.
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