91 direct-sellers ordered to review their management and marketing practices

The State Administration for Market Regulation and the Ministry of Commerce summoned 91 direct-selling enterprises on Tuesday, amid a 100-day national crackdown on wrongdoing in the health products market that began this month.

The enterprises were told to ensure the quality of their products and refrain from making exaggerated claims about their effects, according to a media release.

It said unlawful activities are frequently found in the direct-selling sector, which has seen rapid development in the country, and raise serious concerns among the public because of potentially dire social consequences.

The companies were urged to remain on high alert and abide by the law. They were also ordered to improve internal management and offer channels to handle customer complaints and requests for returns or exchanges.

The direct-sellers were also told to carry out a self-examination in production, sales, customer service and internal management. They will also face random inspections organized by the regulators and be subject to punishment.

The meeting and the crackdown came after Tianjin-based Quanjian Nature Medicine Technology Development and several other health product giants nationwide were probed over complaints they misled consumers about their products or for engaging in pyramid schemes.

Quanjian became the first high profile direct-seller probed last year. The investigation came after Dingxiang Doctor, a healthcare information-sharing platform, accused the company of making huge profits by misleading consumers. The chairman and founder of Quanjian has been detained, along with 16 employees.

The State Administration for Market Regulation and 12 other central government departments launched a nationwide crackdown on wrongdoing in the health products market on Jan 8.