Short title
1.
This
Act may be cited as the Multi-Level Marketing and Pyramid Selling
(Prohibition) Act.
Interpretation
2.
—(1)
In
this Act, unless the context otherwise requires —"benefit"
includes any gratuity, commission,
cross commission, bonus, refund, discount, dividend and any other
payment, service or advantage of whatever description, but does
not include —
(a)
the purchase of a sample of a commodity
furnished at a price not exceeding the cost of the sample and which
is not for resale; and
(b)
time and effort spent in pursuit of
sales, distribution or recruiting activities;
"commodity"
means any goods, service, right or
other property, whether tangible or intangible, capable of being
the subject of a sale, lease or licence;
"company"
means a company as defined in the
Companies Act (Cap. 50) and includes a corporation as defined in
that Act;
“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 or the purported
distribution of a commodity whereby —
(a)
a person may in any manner acquire
a commodity or a right or a licence to acquire the commodity for
sale, lease, licence or other distribution;
(b)
that person receives any benefit,
directly or indirectly, as a result of —(i)
the recruitment, acquisition, action
or performance of one or more additional participants in the scheme
or arrangement; or
(ii)
the sale, lease, licence or other
distribution of the commodity by one or more additional participants
in the scheme or arrangement; and
(c)
any benefit is or may be received
by any other person who promotes, or participates in, the scheme
or arrangement (other than a person referred to in paragraph (a) or an additional participant referred to
in paragraph (b)).
[19/2000]
(2)
In this Act, “pyramid selling
scheme or arrangement” shall be taken not to include such
schemes or arrangements for the sale, lease, licence or other distribution of
a commodity, or any class of such schemes or arrangements, as the
Minister may by order prescribe, subject to such terms or conditions
as may be specified in the order.
[19/2000]
(3)
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.
Unlawful to promote or participate in, or hold out
that person is promoting or participating in, pyramid selling scheme
or arrangement
3.
—(1)
It
shall be unlawful for any person to promote or participate in a
multi-level marketing scheme or arrangement or a pyramid selling
scheme or arrangement or to hold out that he is promoting or participating
in such a scheme or arrangement.
(2)
Any person who contravenes subsection
(1) shall be guilty of an offence and shall be liable on conviction
to a fine not exceeding $200,000 or to imprisonment for a
term not exceeding 5 years or to both.
[19/2000]
Registration of business which is designed to promote
pyramid selling scheme or arrangement prohibited
4.
—(1)
No
business which is designed to promote a multi-level marketing scheme or
arrangement or a pyramid selling scheme or arrangement shall be
registered under any written law relating to the registration of
businesses.
(2)
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 a pyramid selling
scheme or arrangement shall be guilty of an offence and shall be
liable on conviction to a fine not exceeding $200,000 or
to imprisonment for a term not exceeding 5 years or to both.
[19/2000]
Registration of company which proposes to promote
pyramid selling scheme or arrangement prohibited
5.
—(1)
No
company which proposes to promote a multi-level marketing scheme or
arrangement or a pyramid selling scheme or arrangement shall be
incorporated or registered under the Companies Act (Cap. 50).
(2)
Where a company which is designed to
promote a multi-level marketing scheme or arrangement or a 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 and shall
be liable on conviction to a fine not exceeding $200,000
or to imprisonment for a term not exceeding 5 years or to both.
[6
[19/2000]
Offences by bodies corporate
6.
—(1)
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 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.
(2)
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.
(3)
For the purpose of this section, “company” includes —(a)
any body corporate; and
(b)
a firm or other association of individuals.
(4)
This section shall be in addition to
and not in derogation of any other provisions of this Act.
[9
Penalty to be imposed in addition to other punishment
7.
—(1)
Where
a court convicts any person of committing an offence of promoting or
participating in a multi-level marketing scheme or arrangement or
a pyramid selling scheme or arrangement under section 3 (2) then —(a)
if the person has received any benefit,
directly or indirectly, as a result of committing the offence; and
(b)
if the benefit received by the person
is a sum of money or if the value of the benefit can be assessed,
the court shall, in addition to imposing
on that person any other punishment, order him to pay as a penalty,
within such time as may be specified in the order, a sum not exceeding
the amount of or, in the opinion of the court, the value of the
benefit received by the person, and any such penalty shall be recoverable
as a fine.
[19/2000]
(2)
In determining the amount of the penalty
that a person, being a participant, shall be required to pay under
subsection (1), the court may take into account any benefit that
the person may have given for the right to participate in the multi-level
marketing scheme or arrangement or the pyramid selling scheme or
arrangement, as the case may be, or any loss that the person may
have incurred as a result of such participation.
[19/2000]
(3)
Where a person charged with any offence
under section 3 (2) is convicted of one or more offences under any
other written law, and the outstanding offences are taken into consideration
by the court under section 178 of the Criminal Procedure Code (Cap.
68) for the purpose of passing sentence, the court may impose the
penalty mentioned in subsection (1) for any offence under this Act
so taken into consideration.
[19/2000]
(4)
Nothing in subsection (1) shall prejudice
or affect any right which any person may have under any written
law or rule of law to recover damages from the person referred to
in subsection (1).
[11
[19/2000]
Jurisdiction of District Courts
8.
Notwithstanding
the Criminal Procedure Code, a District Court shall have jurisdiction
to try any offence under this Act or any regulations made thereunder
and may impose the full penalty or punishment in respect of such
offence.
[11A
[19/2000]
Act to prevail
9.
The
provisions of this Act shall be without prejudice to the Business
Registration Act (Cap. 32) or the Companies Act (Cap. 50) but where
there is a conflict between the Business Registration Act and the
Companies Act and this Act, the provisions of this Act shall prevail.
[12
Regulations
10.
The
Minister may make regulations for carrying into effect the objects
and purposes of this Act.
[13