The Direct Selling Industry Scores a Win

In March 2012, the direct selling industry has occasion to celebrate what a united industry, companies and distributors, can achieve if everyone pulls oars together in the same direction. The fruits of their labor are apparent in a newly-forged, positive relationship with the primary federal agency that regulates a channel distribution, alternately referred to as direct selling, network marketing and multilevel marketing. In its final FTC Business Opportunity Rule, the FTC stated its clear intention to relieve companies and distributors from what might have been very onerous conditions of recruitment that would have dramatically impaired the ability of distributors to build their businesses.

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…Last week, I knocked Herbalife for claiming it does a bunch of R&D, but not disclosing the amount it spends on it.

Then, later in the week, without fanfare, the nutritional supplement company updated the R&D section of its website to show the amount it spends on R&D and other stuff… Continue Reading…

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www.mlmlegal.com © Jeffrey Babener 2012
Every step you take, I’ll be watching you…Sting, The Police
For better or worse, mlm/network marketing/direct selling companies and their distributors will be impacted by recently adopted FTC Guidelines that impact distributor endorsements and testimonials in online ads, blogs, social networking and other media.
On October 5, 2009, the Federal Trade Commission published a notice that it is adopting revised Guides Concerning the Use of Endorsements and Testimonials in Advertising. The revised Guide basically updates the earlier Guide with particular attention to the use of endorsements, and testimonials on blogs, in word-of-mouth advertising campaigns and on new media platforms, and became effective December 1, 2009.
The new “Guide” will impact direct selling, network marketing, MLM and party plan companies, but there is overlap from previous FTC enforcement. The Guide does not change the duties of the company in ads that make earnings claims or product claims. If earnings claims are made, the FTC has long ago contended that such claims were deceptive unless accompanied by average earnings disclosures. If product performance claims were made, the FTC demanded that the company be able to substantiate the claims and to disclose expected typical results of consumers of the product or service.

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Our last MLM Startup Conference was a hit! Were you unable to join us? Come to our next conference, in Las Vegas, in May! (Reserved for the executives of startup and existing MLM companies!) Visit our website for more information! www.mlmlegal.com

The MLM Startup Conference in Las Vegas!

February 23rd & 24th, 2012 – 9:00AM-4PM and one-on-one time with the speakers from 4PM-7PM, both days

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