The Indian direct selling association has assigned new officials for its top designations
Ajay Khanna, Country Head of Herbalife International India has been assigned as the new Chairman of the association.
Head-Corporate Affairs Rajat Banerji for Amway India has been elected as the Vice-Chairman of the IDSA.
In order to get legal sanctity and recognition from both central and state government authorities, the Indian direct sellers like Tupperware, Amway, Oriflame and their association body IDSA might quickly approach the commerce ministry in coming days.
Right now direct selling sector is of Rs 7,000-crore in India with 18 companies who are promoting through direct sales are seeking the clear meaning of “direct sellers” and distinction from multi-level marketing entities, including those dealing in money circulation schemes.
On the other hand, Amway representatives in the United States are preparing to satisfy commerce minister Anand Sharma, who is presently on an official visit to United States.
“We will prepare a strategy paper and approach the commerce ministry soon. Our proposals of own set of strict guidelines for identifying real direct sellers from the rest are being studied by the finance ministry. We are hopeful that something favorable could come out in a month’s time,” Chavi Hemanth, secretary-general of the Indian Direct Selling Association stated.
Nevertheless, government sources showed that both the consumer affairs ministry and the department of financial services are against exclusion of direct selling entities such as Tupperware, Amway and others from the ambit of Reward, Chit Funds and Money Circulation (Banning) Act, 1978. Both are presently examining the link in between illegal profitable schemes, including ponzi schemes, pyramid schemes and those promoted by the multi-level marketing companies.
Sources in the customer affairs ministry are of the view that instead of a main regulator or a main law, these direct selling entities ought to be subjected.
In order to promote a separate legislation for the direct selling market in India, top global executives of such mlm companies would be visiting India later on this year.
“The CEO council of World Federation of Direct Selling Associations (WFDSA) would be involving India for the first time.
“This is to go over road map of direct selling industry in India as well as to meet various stakeholders to set up a case for a separate legislation for the mlm market,” Indian Direct Selling Association (IDSA) secretary-general, Chavi Hemanth said.
She included that the CEO Council members would be meeting various ministry officials, consisting of those from finance and consumer affairs, throughout their India visit.
Founded in 1978, WFDSA has around 60 members, consisting of Avon, Amway and Herbalife and the CEO Council is the main governing body of the federation. IDSA is also a member of the WFDSA.
“We expect around 10 CEOs out from a total of 30 council members to come to India to attend the WFDSA meeting,” Hemanth said.
IDSA has actually been seeking a separate regulatory structure for the mlm sector in order not distinguish from any fraudulent pyramid and ponzi schemes.