Multi-Level Marketing

Siskinds is one of a very few firms in Canada with experience in the area of direct sales, multi-level and network marketing (“MLM”). MLM is a significant segment of the Canadian economy, and involves the distribution and sale of a wide range of products. MLM may be subject to pyramid selling or business opportunities laws in the United States, but is generally exempt from regulation under the franchise legislation. In Canada, MLM systems are subject to regulation federally under the Canadian Competition Act. Our group has experience with the legislative, common law and regulatory issues facing direct sellers and multi-level marketers.

We assist new and established MLMs in reviewing and writing documentation for the distributor, including sales kit materials, distributor agreements, and policies and procedures. Siskinds advises MLM companies on a wide range of legal matters, including licensing and bonding, registration (including specifically any mandatory filings by non-residents), pricing and competition restrictions, advertising and promotion review, distributor relations and disputes, sales tax or nexus-related issues, independent contractor issues, including unemployment classification, specific contractual requirements, statutory cancellation periods, labelling and packaging requirements, language requirements, trademarks, negative option selling, foreign expansion and other important issues.

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