When we’re engaged by direct selling companies one of the first questions we hear is “Should we go international immediately?” This is an understandable question to ask because the internet has changed the way we do business. Clients who are selling services can offer those services globally in a seamless fashion.

Obviously, more challenges occur if they are selling tangible products because of the required approval process. There are customs issues, tax issues, etc. Our answer to companies, as a general matter, is that they need to consider the cost and expense of international expansion. Some companies will say, “We can’t hold off the sponsoring of distributors around the world.” And, some companies decide they really can’t afford the cost, saying “We’re just going to invite distributors from other countries to come to our website and sign up here in the U.S. We’re not going to deal with the tax issues, compliance issues, etc. We’re going to just try to stay below on the radar.” But is that practical? Practically, if you were to ask us for the right answer, this isn’t the right way to address international expansion since every country – just like the United States – has its own compliance regulations.

If you want to do it right, you’ve come to the right place. We have counterparts around the world that we work with to help companies correctly expand internationally. Our counterparts are in Toronto, London, Kuala Lumpur, Melbourne, Auckland, New Zealand, Paris, and Rome and there are many issues ranging from employment, social insurance and pyramid laws that need to be dealt with if you are going to do it right. International expansion is very expensive. So, our first recommendation to a company is to create a solid program for the U.S. Once the U.S. program is satisfactory then it can be customized and taken around the globe. Companies who are insistent on practical expansion can expect our support, but we cannot reasonably advise that it is the correct way to market the company to international markets.

For more information, watch the companion video to this article: Should an MLM Company go International immediately? Or, download MLMLegal.com’s iTunes application.

As always, visit MLMLegal.com and MLMAttorney.com for endless information on the direct selling industry.

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