The ban on gross sales by network marketing will curb industrial fraud

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Muscat: The decision to ban the sale, advertising or promotion of goods and services through network marketing programs will go a long way in limiting commercial fraud, the Ministry of Trade, Industry and Investment Promotion (MoCIIP) said on Sunday with.

“The decision will help protect competition between institutions and companies and protect individuals from such practices,” said MoCIIP.

Ministerial Decision No. (105/2021) recently adopted by MoCIIP aims to prevent such practices.

Commenting on the adoption of this ministerial resolution, Dr. Mohammed bin Rashid Al Badi, Acting Director of the Legal Department of MoCIIP: “Networks or hierarchical marketing activities start with an individual or company at the top of the pyramid that convinces people to buy a product or to join the group by offering a certain amount of money paid on the promise to provide him with service or some token gain if he can convince others to join his list, with the greatest beneficiary being the one at the top of the hierarchical group. “

“It must be noted that there is a lot of confusion among the general public about hierarchical or network marketing as most of these concepts are different components of the concept of direct selling,” Dr. Maha bint Khamis Al Balushi, Assistant Professor of Marketing and Identity at Sultan Qaboos University, said.

“Indirect sales marketing is sold at a fixed retail location. Despite the popularity of direct selling, there are many types of distributors with different motives. Multi-level marketing is seen as part of network marketing and has a multi-level commission structure based on the volume of sales of products at competitive prices, ”she added.

Dr. Maha Al Balushi stressed that the decision to ban sales through the pyramid scheme helps control this type of activity.

“While this decision helps regulate the direct sales marketing industry in Oman, as this industry also contributes to the country’s gross domestic product (GDP). For example, the legitimate direct sales marketing industry has contributed to the development of the Indian economy with the big government initiatives like Made in India, Skill India, Startup India, etc., ”she added.

Sameh bin Salem Al Adawi said, “The Minister’s decision to ban the sale, advertising or promotion of goods, products and services in Oman is a timely decision and is in line with Oman’s vision of 2040, Oman’s economy to develop and reduce the traffic of anonymous funds. “

“It will also help limit the outflow of funds abroad, reduce the transfer of unknown funds via bank accounts, limit the marketing of unauthorized products, and help control the prices and quality of goods in the local market” he added.

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