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MLM Legal

MLM companies and independent contractors (distributors) must understand the local, national and international laws that regulate the MLM and direct selling industry. In the United States, the direct selling industry is regulated by Federal Trade Commission rulings that influence commission plans or income claims. The sale of products is also regulated for all industries such as the three day return rate. In international legal cases, national and local laws vary.

  • May 6, 2011

    Multilevel Marketing Pyramids-“Lotteries”

    The following article is taken from the MLM Legal Primer . This article looks specifically at how lottery laws can be and are applied to MLM companies. Federal and state multilevel marketing and anti-pyramid statutes are components of a comprehensive consumer protection umbrella. These laws are designed t... Read more ›

  • December 27, 2010

    MLM Companies Training and Monthly Service Fees: Be Careful!

    I’m going to start this article with the conclusion: MLM training fees and monthly service fees, when used to beef up a company’s compensation plan, are usually an attempt to support an anemic business model operating with low margins. It’s not a disaster if you see these “pay to play” fees. However... Read more ›

  • October 14, 2010

    Will the New FTC Guidelines Affect Your MLM Business?

    It's always good to avoid entanglements with the law, so here's some information to help you abide by the new revisions to the FTC Act in your MLM business. I found this testimonial on a website...have you seen others like these? This is a prime example of what the FTC is looking for! I want you to know ... Read more ›

  • September 24, 2010


    Imagine that you have just developed a revolutionary product that you are certain will take the marketplace by storm. You have researched the market, found that a need exists, lined-up manufacturing, and have a distribution system in place. Now, you need only to develop a name and logo that will distinguish y... Read more ›

  • August 20, 2010

    Home Office Deductions–Truth vs. Myths

    As tax time readily approaches, there is still time to determine how you’ll define your “home office” this year. It really doesn’t have to be that difficult if you take a little time to do your homework. So here are a few tax tips to consider during the next couple of months as you’re getting your ... Read more ›

  • June 15, 2010

    The Binary & The Law: A Guilt by Association

    The legality of a network marketing opportunity has little to do with the design of their compensation structure and everything to do with the motivation for buying their products. Every type of compensation plan, be it binary, matrix, unilevel, breakaway, or Aussie 2-up, has it's advantages and disadv... Read more ›