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State Council Order No. 443
23rd Aug., 2005
According
to regulation, there are four conditions for the application of
setting up a direct sales company: 1. Investors must have good
commercial trustworthiness and not have any illegal record within
past five years before the application. Foreign investors must
also have at least three years experience in running direct sales
business outside PRC. 2. Paid up capital must not be less than
80 million Renminbi. 3. Deposit should be fully paid the in designated
banks according to <Regulations for Direct Sales>. 4. Information
system and disclosure system must be set up according to regulations.
Direct sales
enterprises need to open accounts and place deposits in bank designated
by the Administration of Commerce and Administration of Industry
and Commerce of State Council. Deposit amount should be between
20 million to 100 million Renminbi.
Direct sales
enterprise and its branches cannot recruit following people as
salespersons:
1. People who are under the age of 18.
2. People who do not have civil power or have limited civil power
only.
3. Full-time students.
4. Teachers, medical employees, civil servants and army in service.
5. People who are employed as formal direct salespersons already.
6. People outside PRC.
7. People cannot participate in part-time business according to
laws and regulations.
Besides,
the Regulations also clarify managements and managing methods
of direct sales industry.
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