Pyramid-selling ban remains in China

Chinese trade authorities will give the green light to direct selling by the end of this year, to fulfill the country's commitment to its W-T-O membership. But the ban on pyramid selling schemes will remain in place.

Direct selling is the direct transaction between manufacturers or suppliers of consumer goods and their retail customers. It eliminates the need for stores. The world's top PC maker, Dell, is well known for its global direct selling network. More overseas companies are hoping to enter the Chinese market through this sales method.

Trade authorities have pledged to create a better environment for the new business type. But like many other countries, pyramid selling remains illegal in China. Through this sales method, promoters recruit consumers to sell a product and encourage them to recruit others, with the promise of commission. By the end of November, China had dismantled thousands of pyramid selling gangs.

Source: CCTV.com