Multi-Level Marketing and Pyramid Selling (Prohibition) Bill

In this Act, unless the context otherwise requires —

“commodity” means any goods, services, rights or other property whether tangible or intangible capable of being the subject of sale or lease;

“company” means a company as defined in the Companies Act (Cap. 185) and includes a corporation as defined in that Act;

“Minister” means the Minister for Finance;

“multi-level marketing scheme or arrangement” has the same meaning as “pyramid selling scheme or arrangement” in this Act;

“promote”, with its grammatical variations and cognate expressions, includes to manage, form, operate, carry on, engage in or otherwise to organise;

“pyramid selling scheme or arrangement” means any scheme or arrangement for the distribution of a commodity whereby a person may for valuable consideration in any manner acquire a commodity or a right or a licence to acquire such commodity for sale, lease or otherwise —

Any reference in this Act to the winding up of a company includes in the case of a foreign company a reference to the winding up of the affairs of a foreign company so far as the assets of the foreign company within Singapore are concerned.

It shall be unlawful for any person to promote or participate in a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement or hold out that he is promoting or participating in such a scheme or arrangement.

Any person who contravenes the provisions of subsection (1) shall be guilty of an offence under this Act and shall be liable on conviction to a fine not exceeding thirty thousand dollars or to imprisonment for a term not exceeding five years or to both such fine and imprisonment.

No business which is designed to promote a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement shall be registered under any written law relating to the registration of businesses.

A person who in contravention of subsection (1) obtains registration of a business which is designed to promote a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement shall be guilty of an offence under this Act and shall be liable on conviction to a fine not exceeding thirty thousand dollars or to imprisonment for a term not exceeding five years or to both such fine and imprisonment.

No company which proposes to promote a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement shall be incorporated or registered under the Companies Act (Cap. 185).

Where a company which is designed to promote a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement contravenes subsection (1) by obtaining incorporation or registration under the Companies Act, that company and every officer thereof shall be guilty of an offence under this Act and shall be liable on conviction to a fine not exceeding thirty thousand dollars or to imprisonment for a term not exceeding five years or to both such fine and imprisonment.

Upon the coming into operation of this Act a company which promotes a multi-level marketing scheme or arrangement or pyramid selling scheme or arrangement (in this section and section 8 referred to as “the relevant company”) shall forthwith cease to promote that scheme or arrangement.

The relevant company shall within sixty days from the date of the coming into operation of this Act either —

If default is made by the relevant company in complying with subsection (1) or (2) that company and every officer thereof shall be guilty of an offence under this Act and shall be liable on conviction to a fine not exceeding thirty thousand dollars or to imprisonment for a term not exceeding five years or to both such fine and imprisonment.

If the relevant company fails to take action under the provisions of subsection (2) of section 7 or if, having taken action, it fails to complete its winding up or obtain the order of the court that it be wound up, as the case may be, the Minister shall present a petition to the court —

For the purposes of any proceedings under the Companies Act for the winding up of the relevant company the rules relating to the winding up of companies shall be applicable with such modifications and adaptations as the court, in its discretion, considers expedient or necessary.

If the person committing an offence under this Act is a company, every individual who at the time the offence was committed was a director, general manager, manager, secretary or other officer of the company concerned in the management of the company in Singapore or who was purporting to act in any such capacity, as well as the company, shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

It shall be a defence for the individual referred to in subsection (1) if he proves that the offence was committed without his consent or connivance and that he exercised such diligence to prevent the commission of the offence as he ought to have exercised having regard to the nature of his functions and to all other circumstances.

For the purpose of this section “company” includes —

The provisions of this section shall be in addition to and not in derogation of any other provisions of this Act.