How direct selling is regulated and managed in different markets “THAILAND” by Anuwat Dharamadhaj Secretary General to the Consumer Protection Board

Direct selling business in Thailand Total market value : US$ 511 million Number of direct sellers : 3.8 million people Source: Thai Direct Selling Association as of 2002

Why the Act ? Direct approach to the consumers Electronic purchasing and direct marketing Fraud to the public i.e. over claim, pyramid scheme Pressure/aggressive sales

Direct Selling and Direct Marketing Act B.E Effective on August 29, 2002

Concept of the Act To protect the consumers To protect the direct sellers To promote the direct selling business

To protect the consumers : When purchase the products from the direct sellers When the products do not perform as claimed When want to return the products

Significant Sections : - Permission is required before entering to the consumer’s home/workplace. Business identification card must be presented. - Sales documents must be provided to the consumer. - Consumer has the rights to refuse the goods or services after purchasing.

To protect the direct sellers : When recruited to be the direct sellers When pay the unreasonable application fee When forced to purchase the business support materials When want to return the products or quit from the business

Significant Sections : - Fees for membership, training and promotional materials should not be overrated. - Business contract must be notified in the written form. - Independent distributor has the rights to return the goods and promotional materials to the direct selling operator.

To promote the direct selling business : To regulate the direct selling business as a whole To establish the good image of direct selling business To create trust among the consumers -- quality of the products To promote the business opportunity for extra income and economic situation To ban the pyramid scheme

Significant Sections : - Registration must be done before operating the direct selling business. - The operation of the business must be complied with the payment plan. - Direct selling operator should not seduce new members by offering commission.

Direct selling company registration update August 29, August 28, 2003 Submitted : 335 companies Registered : 234 companies

Good points of registration : To have the data base of all direct selling companies in Thailand To simply regulate and easily protect the consumers and direct sellers when get the complaints

Next step : Ministerial regulations Review of the registered compensation plans Ban the bad, Promote the good !