Recent Legislation News Regarding Taiwan’s Direct Selling Industry
Proposed amendments to regulations regarding Taiwan's direct selling industry have risen from all directions. Since legislator Lin Dai-hua from the Economics Committee of the Legislative Yuan proposed the first draft amendment in April last year, other legislators, such as Yang Chong-ying, Wu Qi-ming, and Chen Ting-fei, have presented their respective versions of amendment one after another. Apart from proposed amendments such as compulsory membership, establishment of industry threshold, increase in penalties, and review of functions, mission, and results of the Multi-level Marketing Enterprises and Participants Protection Institute, the focus of amendment is mainly on whether or not the long-standing “notification system”exercised in the multi-level marketing industry should be changed.
On February 4, 2021, legislator Lin Dai-hua, along with personnel from Taiwan Association of Multi-level Marketing, R.O.C., visited the newly inaugurated Chairperson of the Fair Trade Commission (FTC) and made their appeals. Apart from compulsory membership and change of the MLMPF fund to a margin system, the main purpose of legislator Lin and the Association's visit was to lobby for the adoption of a permission system in the multi-level marketing industry. To accelerate the process of the amendment, legislator Lin asked the FTC to compile various proposed amendments and convene people from all walks of life for explanation and discussion. Subsequently, the FTC organized a seminar on March 15 to collect views and opinions from all walks of life and explain the FTC’s position in this regard as follows:
1> Regarding electronic contracts:
This issue has been agreed by all parties and the FTC is no exception. However, since this proposal involves amendment of laws, the FTC will include it in its future amendment proposal.
2> Regarding the optimized notification system:
The FTC accepted the DSA's proposal and agreed to extend the duration of short-time sales promotion event that necessitates advance notification from 15 days to 30 days. In other words, only sales promotion events that last 31 days and longer (or change of event duration) need advance notification. In addition, the FTC also agreed in principle that regular sales promotion or tourism activities only need to notify the FTC at the beginning of each year in order to simplify the process. However, we still need to check out the wording of provisions presented by the FTC after their research and discussion to confirm the elements and scopes of the amendments.
3> Regarding the existing notification system:
In order to manifest the legality of the company that makes a notification, the relevant texts “Notification does not necessarily imply that all behaviors of the company are legal.” will be deleted and the note added in the subject line or description section of the response letter to the notification “Receipt acknowledged” shall be replaced by “Agreed to be kept for future reference”. To complete the process of the notification, the subject line of the response letter shall cite relevant provisions enhance the legality of the notification. From now on (March 15), the FTC will adopt a new notification template. In addition, regarding the suggestion made by direct selling enterprises that all enterprises be provided with an updated approval letter to notification, Director Chang of the FTC agreed to discuss the details of the suggestion in FTC’s internal meetings.
4>Regarding the functions of the MLMPF:
Various public associations and the Multi-Level Marketing Protection Foundation (MLMPF) shall provide specific recommendations on the functions of the MLMPF and the dos and don'ts of MLMPF's business in 30 days. (The Secretariat of the DSA has sent a letter to member companies to collect their opinions and completed response to comments.)
5>Regarding matters such as replacing the notification system with the permission system, compulsory membership, rewards for information on violations, and increase of
penalties against illegal behaviors: The definitions of the “permission system” given by the Taiwan Association of Multilevel Marketing, the Direct Selling Think Tank Association, and the General Chamber of Commerce of the R.O.C. are unclear, in spite of their interrelationship. Further discussion on this issue will not be conducted until specific content of an ideal permission system in the eyes of the above units is provided. The Chairperson of the FTC said that it would be meaningless if merely the term “notification system” is replaced by a different term “permission system” without adjusting the content accordingly.
Generally speaking, the FTC’s attitude and direction towards amendments are similar to those of the DSA. The DSA has planned to visit the FTC on April 21 to exchange opinions on the amendments in the hope of making suggestions on matters such as planning for long-term development of the direct selling industry and maintaining and enhancing the wellbeing of multi-level marketing enterprises and participants on the current basis. The Secretariat will provide an update on the latest development of the situation to member companies with regard to issues on the prospect of the direct selling industry for the benefit of collecting suggestions from all parties so as to make the results of amendments closer to the industry’s needs.
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Adjustment to Rules on Notification for Short-term Sales Promotion Events or Incentive Schemes
The Fair Trade Commission (FTC) held a meeting with direct selling companies on March 15 to jointly discuss the issue of multi-level marketing management system. The DSA is grateful to its representatives for communicating and negotiating with the FTC on behalf of direct selling companies at the meeting. The DSA would also like to thank the FTC for accepting the opinions of direct selling companies.
At the end of the meeting, a resolution was made to optimize the notification process by extending the duration of the “short-term sales promotion event or incentive scheme” that “does not need notification in accordance with Paragraph 1 of Article 7 of the Multi-Level Marketing Supervision Act” from 15 days to 30 days in order to allow direct selling companies to arrange and hold their marketing activities in a flexible manner. After the meeting, the FTC sent an electronic official letter to various multi-level marketing enterprises the next day to inform them of the resolution.
Member companies are welcome to log in the FTC's notification system for more information.
Social Media Platform Updates Use of Information
In late 2020, Tiktok amended its Community Code of Conduct to include a piece of content that explicitly announces, “Please do not post, upload, live stream, or share any content that describes multi-level marketing.” The updated new Community Code of Conduct also announces that, from now on, Tiktok will proactively review the content released by its users mechanically or manually.
Tiktok also encourages community members to report irregular content. Tiktok will directly delete any content that violates the Community Code of Conduct and is likely to suspend or terminate the account or device that seriously or frequently violates the rules and report to the competent authority if necessary. The DSA encourages all member companies to make reference to Tiktok’snewly announced Community Code of Conduct and adjust the use and operating method of their social media platforms accordingly so as to avoid loss of reputation or any unnecessary disputes.
DSA Launches New Logo to Lead into New Era
The DSA launches a brand new Logo, which will be used to update the DSA’s official website and literature from now on.
In order to keep in line with the modern trends and allow more people in our society to make connection with the DSA through a Logo with a new image, the DSA announced a new Logo to all member companies at its 2020 General Assembly.
While carrying on the blue hue as before, the new Logo adopts a simple design, presenting a brand new professional and well-executed style. In addition, the words“WFDSA Member” are added at the bottom of the new Logo to strengthen the international identification of the DSA as a member of the WFDSA.
All member companies are welcome to require the Logo file from the Secretariat of the DSA in order to update the DSA link icon on their official websites.
DSA Facebook Fans Page Officially Launched
From now on, the DSA's brand new Facebook Fans Page is online.
Through its Facebook Fans Page, the DSA can share with member companies and the public the latest industry news and various DSA activities. Furthermore, with easy-to-understand graphics and videos, the DSA invites and welcomes all member companies to visit its Fans Page and click LIKE!
Through online interaction and sharing, more people get to know the DSA and direct selling industry. There are even more rich and fun activities in the future. We invite everybody to follow our Fans Page anytime to get the first-hand event information.
Scan the QR code below to increase popularity of the DSA's Fans Page!
“ATOMY+TMRT=A BEAUTIFUL LIFE” ATOMY Donates 26 AEDs to TMRT
After gaining fame and fortune in Kaohsiung, Atomy Taiwan started committing itself to charity with the aspiration of “Cherish the Spirit”. Following donating 31 AEDs (Automated External Defibrillator) to Taoyuan Metro in 2017, Atomy Taiwan continued to work on general security issues.
Since 2019, Atomy Taiwan has been participating in the implementation of public security in Taichung Mass Rapid Transit (TMRT) by donating 26 AEDs to TMRT Green Line, of which the installation was completed in late 2020. In April 2021, TMRT held the AED Charity Donation Ceremony, themed with “ATOMY+TMRT=A BEAUTIFUL LIFE”, at TMRT City Hall Station. “Before formal operation, TMRT has completed relevant requirements as specified in the Emergency Medical Services Act and acquired AED Safe Place Certification,” said Mr. Lin Zhiying, Chairman of TMRT. Atomy Taiwan feels honored to be able to participate in TMRT’s efforts to create a safe transport environment in greater Taichung area.
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