US body seeks amendment of Act

Expressing its deep concern over the arrest of Amway India CEO William S. Pinckney by Kurnool police, the American Chamber of Commerce- India (Amcham) urged the government to amend the Prize Chits and Money Circulation Schemes (Banning) Act 1978.

The contention of the Amcham-India, a trade body of American companies operating in India, supported by American Embassy, is that the PCMCS was a law enacted much before the direct selling companies came into existence and could not distinguish the direct selling industry and the pyramid schemes. The body said that Amway is a direct selling company that uses multi-level marketing to sell its high quality products through independent distributors instead of from a shop or a mall. The distributors earn income from the sale of products and not by recruiting members as in pyramid schemes, it said.

While appreciating the desire of the government to protect the financial interest of citizens, the Amcham-India called for creating conducive legal atmosphere for direct selling industry.

It pointed out that many countries that had stringent consumer protection laws clearly distinguish between direct selling companies and pyramid schemes.

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