The Fair Trade Commission (FTC) announced on October 28 that there were 119 registered multi-level marketing companies as of the end of last month.

Multi-level marketing refers to a sales structure operating across three or more sequential tiers, where sales representatives recruit others to join as their downstream members when selling products.

Sellers pay sponsorship allowances to their representatives.

The number of registered multi-level marketing companies in the third quarter remained at the same level as the previous quarter.

Newly registered companies totaled two: Altovita Co., Ltd. and Rodem Korea Co., Ltd.

There were also two closures: Cellip Korea Co., Ltd. and Footing Korea Co., Ltd.

Changes in company names or addresses occurred at four companies: Charis Co., Ltd., Unexakorea Co., Ltd., LR Health & Beauty Ltd., and Amare Korea Co., Ltd.


Those who wish to trade with multi-level marketing companies or work as sales representatives must check key information such as the business registration status and whether the company is operating, suspended, or closed to prevent potential damages during transactions.

The FTC advised that extra caution is required when dealing with companies that frequently change their trade names or main business addresses, as damages such as difficulties in obtaining refunds may occur.

It also noted that multi-level marketing companies whose consumer damage compensation insurance, such as mutual-aid agreements or debt payment guarantee contracts, has been terminated cannot engage in normal business operations, even if they have not yet filed for business closure with the local government.

In the third quarter of this year, Ace One Global Co., Ltd., located in Gyeonggi Province, terminated its contract with the Direct Selling Mutual Aid Cooperative, though it has not yet suspended operations or closed its business.

Detailed information on multi-level marketing companies can be found on the FTC website (www.ftc.go.kr).

(Photo: Provided by the FTC, Yonhap News)