Centre now plans to rein in direct selling industry, tighten regulations

livemint.com:

NEW DELHI : The multi-billion-dollar direct selling industry has now come in the crosshairs of the central government, with the department of consumer affairs (DoCA) planning to scrutinize their regulatory compliances and prepare a list of rule violators, three people aware of the matter said. Several measures are also being put in place to increase vigilance against violation of direct selling rules and other unscrupulous practices by the fast-growing industry, the people added.

“All firms operating in India through direct selling must provide a customer care number, and details of their management with a valid email address and phone number," the first person said. “Besides, they will have to put a consumer redressal mechanism in place." These rules will become mandatory after a thorough analysis of direct-selling firms' compliances and violations by the DoCA.

Also read: The good, bad, and ugly of direct selling firms in India The Consumer Protection Act 2019 provides safety to consumers regarding defective products, dissatisfactory services, and unfair trade practices. The key objective of the Act is to protect the rights of consumers by establishing authorities for timely and effective administration and settlement of consumer disputes.

“The department has noticed that a significant number of direct selling firms, including premier category firms, are involved in unscrupulous practices to promote their products among consumers, which is a cause for concern," the second person said, adding that the DoCA plans to scrutinize complaints filed against direct selling companies to analyse the violations of the Consumer Protection (Direct Selling) Rules, 2021. “Based on the assessment of these complaints, an action plan will