Pinckney: Awaiting norms

Calcutta, Nov. 17: The draft guidelines that will bring direct selling under the regulatory purview of a ministry are likely to be in place within a month.

The Indian Direct Selling Association (IDSA), a self-regulatory body for direct sellers in the country, has demanded such a move to prevent proliferation of fraudulent operations in this industry.

The government has set up a cross-functional group to prepare the guidelines. The group, which will be led by the corporate affairs ministry, will include members from the RBI, finance ministry and the consumer affairs ministry.

According to a report by Ernst & Young, the direct selling industry in India is expected to touch Rs 7,120 crore by 2012-13. The size of the industry was Rs 4,120 crore in 2009-10.

“The government should clearly define direct selling and enact governing legislation for the sector. It should appoint a nodal ministry for direct selling. In the next 30-60 days, the draft guidelines are expected to be in place. The final draft should be out within 30 days and the implementation can be expected in a year’s time. When these are tabled, we will have an opportunity to give inputs which again will be reviewed,” William S. Pinckney, managing director and CEO of Amway India, a member of the IDSA, said.

The IDSA has submitted its inputs to the various ministries and shared with them the existing norms in the UK, Singapore and Malaysia.

According to Pinckney, states such as Kerala and Rajasthan have already recognised the proliferation of fraudulent schemes and issued guidelines to check them at the state level in November 2011 and October 2012, respectively.