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Centre notifies the Consumer Protection (Direct Selling) Rules, 2021 - (28 Dec 2021)


Central Government notifies the Consumer Protection (Direct Selling) Rules, 2021 in exercise of the powers conferred by clause (zg) of sub-section (2) of section 101 read with section 94 of the Consumer Protection Act, 2019. These Rules are applicable to all goods and services bought or sold through direct selling, all models of direct selling, all direct selling entities offering goods and services to consumers in India, all forms of unfair trade practices across all models of direct selling and also to also to a direct selling entity which is not established in India, but offers goods or services to consumers in India. The rules notified by the Centre would be called as Consumer Protection (Direct Selling) Rules, 2021.

Existing direct selling entities need to comply of these rules within ninety days from the date of publication of the Rules in the Official Gazette. The direct sellers as well as the direct selling entities using e-commerce platforms for sale has to comply with the requirements of the Consumer Protection (e-Commerce) Rules, 2020. State Government are directed to set up a mechanism to monitor or supervise the activities of direct sellers and direct selling entity. Both Direct selling entity and direct sellers are prohibited from promoting Pyramid Scheme or money circulation scheme.

Every direct selling entity shall appoint a nodal officer who would be responsible for ensuring compliance with the provisions of the Act and the rules made there under. Further, every direct selling entity shall establish a mechanism for filing of complaints by consumers through its offices or branches or direct sellers, either in person or through post, telephone, e-mail or website. No direct selling entity shall, directly or indirectly, falsely represent itself as a consumer and post reviews about its goods or services or misrepresent the quality or features of any of its goods or services.


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