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TOG NEWS

Sikkim, Chhattisgarh adopt direct selling guidelines
By TOG News Service
Nov 22, 2017

TOG News Service, NEW DELHI, NOV 22, 2017: THE states of Sikkim and Chhattisgarh today adopted model guidelines on direct selling, whereas the states of Karnataka, Maharashtra and Tamil Nadu already were in the process of implementing the same. The Union Minister for Consumer Affairs Mr. C R Chaudhary stated that the government would consider the industry's proposal to frame a separate law to regulate the direct selling sector, which industry body ASSOCHAM expected to touch Rs 45,000 crore by 2025, from the current Rs. 7,770 crore. The Minister further stated that the direct selling sector needed further development as it had the potential to generate jobs.

The guidelines for direct selling, offer clarity on the direct selling sector, and prohibit pyramid and money circulation schemes, operating under the garb of direct selling business. However, the Minister conceded that being guidelines, these only had pursuasive value and no state could be compelled to implement them. These guidelines were framed in September 2016, and by far, only the states of Sikkhim and Chhatisgarh had implemented the, while Karnataka, Maharastra and Tamil Nadu were in the process of implementing them. The Minister expressed hope that more states would adopt the guidelines for direct selling.

On the demand by the industry for framing a separate law, the Minister affirmed that after the model guidelines, the framing of a law was in the pipeline. The Minister also stressed upon the need for a law, considering the drawbacks in the existing system. He further stated that any business could grow if regulatory systems were in place to facilitate production to marketing of products. The Minister also drew attention to government schemes such as Start-Up India, launched to encourage entrepreneurs. However, it was stated that such schemes would not taste success without the promotion and strengthening of the direct selling industry.