Can we run MLM company with proper product legally in India?


can we run MLM company with proper product legaly in india

Answers (3)


458 votes

This question has been answered by one of our lawyers. See answer below.

139 votes

Yes you can provided the product you are selling is legal and the manner in which you structure your operations does not breach Indian law, specifically Prize Chits & Money Circulation Scheme (Banning) Act, 1978. There are some companies in Telengana which are being prosecuted for using a MLM company to run an illegal money circulation scheme. Consult a lawyer and a CA since you need proper clarity on how will be raising an invoice and for what.


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265 votes

Yes one can run an MLM company in India however, there are no particular laws governing the same and the MLM structure needs to be carefully formulated otherwise it may attract provisions of Prize Chit Fund Act and Money Laundering Act. The same happened with Amway however, structures like tupperware and avon were clear of these acts. The product, its reach and the way of commission disbursal are key points.

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