France

Report Topics:

1:- General Information

2:- Cooling-off Period

3:- Pyramid Schemes

4:- Multi-Level Marketing

5:- Prohibition on Products

6:- Credit Restrictions Country

7:- Money Collections

8:- Licenses

9:- Status of Direct Sellers

10:- Earnings Claims

11:- Taxes and Fees

12:- Social Security

13:- Others

I. General Information

The law of 1972 began to regulate door-to-door sales and approaches. The Consumer Law of 17 March 2014 substituted the concept of door-to-door sales for that of contracts concluded

remotely or off-premises. This law transposed Directive 2011/83/EU of 25 October 2011 on contracts concluded between traders and consumers for the supply of goods or services.

The legal framework set out in the Consumer Code comprises three main sets of measures for off-premises contracts:

Drawing up compliant documents,
A ban on receiving any payment for a period of 7 days,
A 14-day right of

About the compliant documents, before placing an order, the door-to-door salesperson must provide the customer with a pre-contractual information document (article L.221-5 to L.221-7 of the French Consumer Code. Then, when the order form is concluded, the doorstep seller must provide the customer with a dated copy of the contract on a durable medium. The contract must include a certain number of mandatory details, failing which it will be null and void.

II. Cooling-Off Period

Previously, the cooling off period for consumers was 7 days starting from the order.

Since the Consume law, the cooling off period has been expended to 14 days (article L.221-18 of French Consumer Code), starting from :

the order as regards service contracts, or
the delivery as regards good contracts and service contracts including delivery of goods. However, there are specific cases where the right of withdrawal cannot apply (Article 221-28).

III. Pyramid Schemes

The French Consumer Code prohibits pyramid schemes and snowball sales (article L121-15) :

« 1° The sale of goods using the ‘snowball’ method or any other similar method consisting in particular of offering goods to the public with the expectation that they will be obtained free of charge or for a sum less than their real value and making sales conditional on the placement of vouchers or tickets with third parties or on the collection of memberships or registrations ;

2° Offering to collect memberships or to register on a list by demanding that a person pay any consideration whatsoever and expecting financial gain from an increase in the number of persons recruited or registered rather than from the sale, supply or consumption of goods or services.

In the case of sales networks formed by chain recruitment of members or affiliates, it is forbidden to obtain from a member or affiliate of the network the payment of a sum

corresponding to an entry fee or the acquisition of equipment or services for educational, training, demonstration or sales purposes or any other similar equipment or service, when this payment leads to a payment or the attribution of an advantage benefiting one or more members or affiliates of the network.

In addition, it is forbidden, in these same networks, to obtain from a member or affiliate the acquisition of a stock of goods intended for resale, without a guarantee that the stock will be taken back under the conditions of purchase, after deduction, where appropriate, of a sum not exceeding 10% of the corresponding price. This take-back guarantee may, however, be limited to a period of one year after the purchase. »

Carrying out a ‘snowball’ sale or service or any similar procedure as defined in the previous article is punishable by two years’ imprisonment and a fine of 300,000 euros.

The amount of the fine may be increased, in proportion to the benefits derived from the offence, to 10% of the average annual turnover, calculated on the basis of the last three annual turnover figures known on the date of the offence.

IV. Multi-Level Marketing

Multi-level selling (MLM) is legal in France and pays sellers on their sales and those of their recruits. Pyramid sales, on the other hand, where profits come mainly from recruiting new members rather than selling products, are prohibited.

V. Prohibition on Products

According to article L.221-2 of the French Consumer Code, the legislation on direct sales does not apply to certain contracts, in particular because they are governed by a specific law. These contracts include :

contracts for social services, including social housing, childcare and family support ;
contracts relating to health services provided by health professionals, including the prescription and dispensing of medicines and medical appliances; and
contracts relating to gambling and games of chance;
contracts relating to financial services;
contracts drawn up by a public official;
contracts relating to the creation, acquisition or transfer of real estate or rights in real estate, the construction of new buildings, the significant alteration of existing buildings or rental for residential purposes;
contracts for the supply of foodstuffs, beverages or other everyday household goods, which are physically delivered by a professional on frequent and regular rounds to the consumer’s home or place of residence or work;

Consequently, the above contracts cannot be sold by direct salling methods.

There are other specific legal regimes in the following cases:

Telephone or internet sales (specific distance selling regime);
Sale at markets, fairs, exhibitions or any place normally used for

VI. Credit Restrictions Country

In the case of consumer credit, the lender’s pre-contractual information and contractual obligations are set out in articles L312-12 et seq. of the French Consumer Code.

The borrower may withdraw without giving reasons within fourteen calendar days from the date of acceptance of the offer of a credit agreement.

VII. Money Collections

Article L342-1 of the Monetary and Financial Code provides that “prohibited peddling and canvassing for the sale, purchase or exchange of gold bullion, bars, coins and foreign coins gold demonetized. Engages in peddling these matters who goes to the home of individuals, other than the bankers, brokers and dealers in precious metals, or in public places not reserved for

this purpose, to provide or obtain the materials listed designated above, with immediate delivery and payment, in whole or in part, either in cash or securities. ”

Moreover, the home seller may not receive any payment or consideration from the customer before the expiry of a period of 7 days from the conclusion of the contract. This means that the home seller may not receive deposits, cheques or direct debit authorisations. They are also prohibited from providing a service before this period has expired (article L221-10 of the French Consumer Code)

The contract is invalid if the home seller receives payment without respecting this deadline. The seller is liable to 2 years’ imprisonment and a fine of €150,000 ( article L242-7).

There are, however, cases in which the door-to-door salesperson may collect payment without observing the 7-day period:

Subscription to a newspaper devoted to political information (daily, monthly or fortnightly)
Contract for the provision of personal services (concluded with an approved organisation)
Contract concluded during a meeting organised by the seller at his home or at a customer’s home
A contract for emergency repairs to be carried out at the customer’s home at the customer’s

VIII. Licenses

No legislation

IX. Status of Direct Sellers

The status of the VDI is governed by articles L135-1 to L135-3 of the French Commercial Code.

Like commercial agents, home sellers operate independently and autonomously, without being registered with the Trade and Companies Register (RCS) or the Special Register of Commercial Agents (RSAC).

However, registration with the RCS/RSAC is compulsory for sellers who have been in business for 3 consecutive calendar years, even intermittently, and who have earned gross annual pay for each of these years in excess of 50% of the annual Social Security ceiling (23.550€ for 2025, 23,184€ for 2024 and 21,996 € for 2023).

From a social security point of view, direct sellers are treated in the same way as employees and are covered by the social security system (article 311-3, 20° of the French Social Security Code). They are not subordinate to the company; the labour code and collective agreement do not apply to them.

The Independant direct seller (VDI) must enter into a contract with a direct sales company that entrusts him/her with the sale of its products or services.

X. Earnings Claims

No legislation

XI. Taxes and Fees

Employees and independent sellers pay their own income tax.

Under tax legislation, income from sales activities and, where applicable, promotion is taxed as non-commercial profits (BNC) for the VDI agent and as industrial and commercial profits (BIC) for the VDI buyer-reseller.

Self-employed direct sellers registered as VDIs benefit from simplified provisions for income tax, VAT and accounting obligations.

XII. Social Security

Employees and Sellers who can are eligible for VDI status, benefit from the General Social Security system.

XIII. Others

Doorstep selling is prohibited where the consumer has clearly and unambiguously stated that he or she does not wish to be visited. Contravening this ban is punishable by 1 year’s

imprisonment and a 150,000€ fine. It is also forbidden to make a purchase from another

independent door-to-door salesperson (article L.221-10-1of the French Consumer Code).

In case of incorrect information or a lack of compulsory information, the seller could be penalised for misleading commercial practices (L.121-2 to L121-5 of the same code). In case of

repeated and insistent solicitations or the use of physical or moral coercion on the consumer, the seller may be penalised under aggressive commercial practices (L.121-6 and L121-7).

Finally, it is forbidden to take advantage of a person’s weakness or ignorance in order to persuade them, by means of home visits, to enter into commitments in cash or on credit in any form whatsoever, where the circumstances show that the person was not in a position to appreciate the scope of the commitments they were entering into or to detect the tricks or

devices used to persuade them to enter into them, or show that they were subjected to coercion (articles 121-8 to 121-10)

the aim of the system must be the sale of products to consumers and not the recruitment of new distributors;

the Law of 1972 about consumers’ rights, the Law of 1995 about pyramid schemes and the Law of 27 January 1993 about independent sellers’ status must be strictly applied;

companies must provide complete and accurate information to distributors concerning their rights and obligations (for all commercial, legal, social and fiscal points), their earnings and entrance fees;

companies must give their direct sellers a written agreement, containing all details of the relationship between the seller and the company;

the right of entry into the scheme must correspond solely to the cost of investment and the purchase of the necessary stock for sale.

Prohibition on Products

According to the article L.121-16-1 of the consumption code, Direct Selling’s Legislation does not apply to certain contracts, mostly because they are governed by a specific law. This includes the followings :

– contracts concerning social services including social housing, childcare and support of families,
– contracts concerning health services provided by health care professionals, including prescription, delivery of medicines and medical device,
– contracts concerning gambling,
– contracts concerning financial services,
– contrats drafted by a public officer,
– contracts concerning creation, acquisition or transfer of real estate or rights on real estate, construction of new buildings, significant transformation of existing buildings or leasing for residential purposes.

Therefore, the contracts above may not be sold by direct selling methods.

Credit Restrictions Country
The Law of 1st July 2010 (included into the consumption code with the articles L311-1 to L311-52) protects the consumer in the field of credit.

Money Collections
Article L342-1 of the Monetary and Financial Code provides that “prohibited peddling and canvassing for the sale, purchase or exchange of gold bullion, bars, coins and foreign coins gold demonetized.

Engages in peddling these matters who goes to the home of individuals, other than the bankers, brokers and dealers in precious metals, or in public places not reserved for this purpose, to provide or obtain the materials listed designated above, with immediate delivery and payment, in whole or in part, either in cash or securities. ”

Licenses
No legislation.

Status of Direct Sellers
According to the latter, the independent direct salespersons have to register either with the professional register of commerce and trades (if they are distributors) or with the professional register of commercial agents (if they are agents) provided that (cumulative conditions) :

they have performed as independent salespeople for the last full three (3) years;

they have reached a minimum benefit higher than 50% of the annual social security threshold (approx. 20 000 Euros) which includes the sum of commercial margins and commissions for distributors or commissions for agents.

Earnings Claims
No information

Taxes and Fees
Employees and independent salespeople pay their own income tax.

Social Security
Employees and independents salespeople benefit from the General Social Security system.

Others
The prohibition of receiving any kind of payment before a 7 days period after the order, edicted by the 1972 Law, was tempered with the 2014 Law relating to Consumption.

This law maintained the preexisting exceptions (subscriptions to a daily publication and contracts regarding personal care services), and added two more :

– meeting sales organized at the seller’s or consumer’s residence;
– maintenance and repair works requested by the consumer in case of emergency.

The WFDSA International Guide to Direct Selling Legislation is a guide and is not exhaustive either in terms of subjects presented or for all areas of concern to direct selling companies. It is intended to cover general areas of concern. The Guide is not a substitute for legal counsel but only intended to alert you to the general nature of laws and regulations affecting the direct selling industry in a particular country. Consequently, before beginning an operation in any foreign country, it is strongly recommended that competent legal counsel be consulted. While every effort has been made to insure that the information contained in this Guide is accurate, the variety of sources used makes absolute verification difficult. Further, laws and regulations also can change from time to time without notice. Therefore, the WFDSA cannot be held liable for the information included in this publication.