Twenty-five multi-level marketing companies have been shut down.

From June 2015 to the present, the Ministry of Industry and Trade has inspected and penalized 64 cases of multi-level marketing companies violating regulations, with total fines exceeding 11 billion VND.

According to the latest figures from the Ministry of Industry and Trade, in the first six months of 2016, multi-level marketing companies generated approximately 4,000 billion VND in revenue. The main products sold were functional foods, cosmetics, and household goods. These companies paid nearly 500 billion VND in taxes and spent 712 billion VND on commissions for participants.

However, multi-level marketing activities have many irregularities, affecting people participating in the network. The main violations include multi-level marketing companies operating without proper certification, using multi-level marketing methods to conduct service businesses or raise funds, etc.

The Hoang Kim Network company has just been shut down.

Due to these violations, as of early November 2016, the Ministry of Industry and Trade had shut down 25 multi-level marketing companies. Of these, 14 companies had their multi-level marketing registration certificates revoked, and 11 businesses temporarily suspended or ceased operations.

Currently, the number of operating businesses has decreased from 67 companies in 2015 to 42. The number of people participating in multi-level marketing is approximately 500,000, a 57% decrease compared to 1.2 million in the same period of 2015.

In a press release, the Ministry of Industry and Trade stated that it has implemented numerous measures to manage multi-level marketing activities, including issuing Directive No. 02 on strengthening inspection, supervision, and handling of violations of the law in multi-level marketing activities.

As a result, from June 2015 to November 2016, the Ministry inspected and initiated investigations into 65 cases involving multi-level marketing companies, and penalized 64 cases with total fines exceeding 11 billion VND.

According to local reports, from the beginning of 2016 to the present, 38 out of 57 Departments of Industry and Trade have organized inter-agency inspection teams to inspect businesses operating in their areas. 37 Departments of Industry and Trade have issued fines to 21 businesses for violations, totaling nearly 4 billion VND.

In addition, from the beginning of 2015 to the present, market management forces have inspected and handled 353 cases related to multi-level marketing, with a total fine of nearly 5 billion VND.

In addition, 18 multi-level marketing businesses nationwide that did not have the required business registration certificates were discovered and fined a total of 653 million VND.

The Ministry of Industry and Trade affirms that in the coming period, to continue managing multi-level marketing activities, the Ministry will actively implement the work of drafting a Decree amending Decree 42 to submit to the Government for promulgation at the end of 2016 or the beginning of 2017.

In 2017, the Ministry will implement amendments, additions, and improvements to the Government's Decrees on handling violations of the law in multi-level marketing activities. The Ministry will also continue to monitor and propose to the lead agency to research and add regulations on crimes related to multi-level marketing business activities to the 2015 Penal Code.

In addition, the Ministry continues to direct relevant agencies to strengthen supervision, inspection, and examination of multi-level marketing activities nationwide; and at the same time, strictly handle violations to ensure a healthy and efficient business environment.

According to Zing