Hong Kong (Updated April 2024)

General Information

General Information

In Hong Kong, there is no dedicated regulation on direct-selling. Any company that has registered with a business license could conduct wholesale/retail business in Hong Kong, including direct-selling.

 

Cooling-off Period

There is no regulation-demand cooling-off period for any retail transaction. Under the voluntary self-regulatory scheme, the Direct Selling Association of Hong Kong demands all member companies of the offer a minimum of a 7-day cooling-off period from the date of purchase. During this period, customers have the absolute right to cancel their purchase.

 

Pyramid Schemes

The only legislation specifically affecting direct-selling is the “Pyramid Schemes Prohibition Ordinance” (Ch. 617) of 2012.

 

In this ordinance, a pyramid selling scheme is defined as a scheme whereby:

 

(1) A pyramid scheme is a scheme with all the following characteristics—

(a) to participate in the scheme, any or all new participants must provide either of the following (participation payment)—

(i) a financial or non-financial benefit to, or for the benefit of, any participant or any promoter of the scheme;

(ii) a financial or non-financial benefit partly to, or for the benefit of, any participant or any promoter of the scheme and partly to, or for the benefit of, another person;

 

1. b) the making of the participation payment is entirely or substantially induced by the prospect held out to the new participant that the new participant will be entitled to either of the following (recruitment payment)—

(i) a financial or non-financial benefit to, or for the benefit of, the new participant;

(ii) a financial or non-financial benefit partly to, or for the benefit of, the new participant and partly to, or for the benefit of, another person;

 

(c) the recruitment payment referred to in paragraph (b) is entirely or substantially derived from the introduction to the scheme of a further new participant.

 

(2) A scheme may be a pyramid scheme regardless of—(a) who holds out to a new participant the prospect of entitlement to a recruitment payment;(b) who is to make a recruitment payment to a new participant; and (c) who is to introduce a further new participant to the scheme.

(3) A scheme may be a pyramid scheme even if it has any or all of the following characteristics—

(a) the scheme involves the marketing of goods or services (or both);

(b) a participation payment may or must be made after a new participant begins to participate in the scheme;

(c) making a participation payment is not the only requirement in order to be eligible to participate in the scheme;

(d) making a participation payment is not the only requirement in order to be eligible to receive a recruitment payment under the scheme;

(e) the holding out of the prospect of entitlement to a recruitment payment does not give any new participant a legally enforceable right;

(f) the arrangement for the scheme is not recorded in writing (whether entirely or partly).

Any person who knowingly promoting a pyramid selling scheme commits offences defined in the Ordinance on indictment to a fine of HK$1,000,000 and to imprisonment for 7 years.

 

 

 

Multi-Level Marketing

No specific legislation on Multi-Level Marketing or Direct-selling.

 

Prohibition on Products

No prohibition of products specially on direct-selling.

 

Credit Restrictions Country

No legislation.

 

Money Collections

No legislation.

 

Licenses

There is no specific regulation to demand the registration of direct-selling companies in Hong Kong. Any company doing business in Hong Kong must register with the Companies Registry of Hong Kong Government.

 

Status of Direct Sellers

No legislation to regulate direct seller.

 

Earnings Claims

No legislation.

 

Taxes and Fees

No taxes and fee legislation specially on direct-selling.

 

Social Security

Hong Kong does not have a social security tax system. There is no legislation on social security.