Multi-level Suspension Requests Now Possible via Electronic Documents

Revision of Multi-Level Marketing Suspension Procedures Previously Only on Paper
Simplification of Closure Reports for Door-to-Door Sales Businesses
Amendment to Door-to-Door Sales Act Enforcement Decree Approved at Cabinet Meeting

Examples of Multi-level Marketing and Sponsored Door-to-Door Sales. (Source: Korea Fair Trade Commission)

[Asia Economy Reporter Moon Chaeseok] From now on, requests to stop damages caused by illegal multi-level marketing (MLM) can be made through electronic documents instead of written forms. Business operators who wish to report closure only need to state the reason for loss or damage and do not have to submit the certificate of report.

The Korea Fair Trade Commission (KFTC) announced that the amendment to the Enforcement Decree of the Act on Door-to-Door Sales, etc. was approved at the Cabinet meeting on the 24th. It will be promulgated and enforced immediately on the 1st of next month.

First, consumer rights regarding MLM damages will be strengthened. The method for requesting cessation of illegal MLM damages will be digitized.

The current Enforcement Decree requires submission of a written request to stop illegal MLM damages. This has been criticized for slowing down the relief process.

The amendment allows requests to stop illegal MLM damages to be made via electronic documents.

Additionally, the closure reporting procedure for door-to-door sales operators will be simplified.

Operators who have lost or damaged their certificate of report will no longer need to reissue the certificate when applying for closure.

Ryu Yongrae, head of the Special Transactions Division at the KFTC, said, "The amended Enforcement Decree will resolve inconveniences related to closure procedures for door-to-door sales operators. Consumer relief measures related to illegal MLM will diversify, and consumer protection in the MLM sector will be further strengthened."

The KFTC plans to amend the Enforcement Rules of the Door-to-Door Sales Act by adding a section in the appendix (report form) for stating reasons for loss or damage of certificates, to be implemented together with the amended Enforcement Decree.

This content was produced with the assistance of AI translation services.