Condition for Direct Selling contract between Direct Seller/ Distributor and Direct Selling Entity.

1.   Every Direct Selling entity shall execute a contract agreement, whether directly or indirectly, with Direct Sellers before enrolment:

• The Agreement shall be provided in manner consistent with Section 10 of Indian Contarct Act, 1872;
• In addition to the right and obligations of parties to this agreement under these guidelines or any other law in force, parties shall have rights and obligations that are coextensive with right and obligations of parties under the Indian Contract Act, 1872;

2.   The agreement shall be made in writing, describing the material terms of participation and shall:

• Not compel or include the direct seller to purchase goods or services in an amount that exceeds an amount that can be expected to be sold to consumers within a reasonable period of time;
• Allow or provide the direct seller a reasonable cooling-off period in which to cancel participation and receive a refund for goods or services purchased;
• Allow for the termination of contract, with reasonable notice, in such instances and on such terms where a direct seller is found to have made no sales of goods or services for a period of upto two years since the contract was entered into, or since the date of the last sale made by the direct seller;
• Allow or provide for the a buy-back or repurchase policy for the currently marketable goods and services sold to the direct seller at the said direct seller’s request at reasonable terms

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