[EDITORIALS]Muzzle multilevel marketingConsumer rights groups and some government ministries are fuming over a revision proposal that some fear will aggravate the bad effects of the multilevel marketing business, after a committee of the National Assembly passed the bill quietly.
Multilevel marketing, which is spreading rapidly across the country, is an efficient market strategy, allowing consumers to become salesmen of the products they purchase, in return for compensation.
But it has been the subject of a heated controversy because of the allegedly evil impact of the marketing techniques employed. The multilevel marketing industry has not cleared itself of the negative image of the so-called pyramid sales, under which many sales agents inflict losses on their families and relatives and end up in huge debt.
Under the circumstances, it is hard to understand, both in terms of the content and the procedure, the bill that passed the legislature's National Policy Committee on Dec. 3. The bill calls for the overall deregulation of the multilevel business. It would effectively remove the ceiling on the prices of goods that can be sold through a multilevel sales scheme, while drastically softening the legal requirement for the establishment of various multilevel businesses. At the same time, it would reduce the number of days in which customers can demand refunds, and ease the punishment of business people who violate the law.
In a free-market economy, it is desirable for a government to ease restrictions on business activities. But it does not mean that a government should lift regulations on businesses that can potentially produce a large number of innocent victims.
The Ministry of Justice vehemently opposes the revision proposal, not to mention consumer rights organizations. Because the potential damage to consumers stands to be large, the National Assembly ought to remove all clauses of the bill that may cause problems during the remaining procedures or repeal the proposal itself.