Multi-Level Marketing and Pyramid Selling (Excluded Schemes and Arrangements) Order 2000

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No. S 248

Multi-Level Marketing and Pyramid Selling (Prohibition) Act

(Chapter 190)

Multi-Level Marketing and Pyramid Selling
(Excluded Schemes and Arrangements) Order 2000

In exercise of the powers conferred by section 2(1A) of the Multi-Level Marketing and Pyramid Selling (Prohibition) Act, the Minister for Trade and Industry hereby makes the following Order:

Citation and commencement

1. This Order may be cited as the Multi-Level Marketing and Pyramid Selling (Excluded Schemes and Arrangements) Order 2000 and shall come into operation on 1st June 2000.

Excluded schemes and arrangements

2.—(1) The definition of “pyramid selling scheme or arrangement” in section 2 of the Act shall be taken not to include any of the following schemes or arrangements:

(a)

any scheme or arrangement comprising insurance business, or any class of insurance business, so long as every insurer and every insurance intermediary participating in the scheme or arrangement is registered, licensed, approved or otherwise so entitled to act under the Insurance Act (Cap. 142), the Insurance Intermediaries Act 1999 (Act 31 of 1999), or the regulations made thereunder;

(b)

any master franchise scheme or arrangement, or any class of such scheme or arrangement, whereby a person is given the right to sub-franchise a franchise, subject to the scheme or arrangement satisfying the conditions in sub-paragraph (c)(i), (ii) and (iii);

(c)

any scheme or arrangement, or any class of such scheme or arrangement, which satisfies the following conditions:

(i)

any benefit received by any promoter or participant in the scheme or arrangement accrues as a result of the sale, lease, licence or other distribution of a commodity to any other person, and not as a result of the recruitment of one or more persons to be additional participants in the scheme or arrangement;

(ii)

the promoter of the scheme or arrangement shall not knowingly make, or cause to be made —

(A)	any representation relating to the scheme or arrangement, or relating to the commodity, which is false or misleading; or
(B)	any omission in a material particular relating to the scheme or arrangement, or relating to the commodity;

(iii)

the promoter of the scheme or arrangement shall not make, or cause to be made, any representation to any person that benefits will accrue under the scheme or arrangement in a manner other than as specified in sub-paragraph (i); and

(iv)

the commodity shall be distributed with a refund or buy-back guarantee that is exercisable on reasonable commercial terms, and every participant in the scheme or arrangement and every consumer of the commodity shall be informed of the existence of the guarantee and the manner in which it can be exercised.

(2) For the purposes of sub-paragraph (1)(b), “franchise” has the same meaning as in section 107(1) of the Companies Act (Cap. 50).

Made this 23rd day of May 2000.

KHAW BOON WAN

Permanent Secretary,
Ministry of Trade and Industry,
Singapore.

[MTI 66/1-027; AG/LEG/SL/190/2000/1 Vol. 1]

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