Yes. Electronic Commerce Act 2006 gives legal recognition to online trades. This means that all transactions are valid in law.

Major features: -

1. Promotion of a scheme or compensation, which is solely or primarily through the recruitment of participants or the introduction of participants into the scheme, plan, handling, or pyramid chain process from the sales of products, services or intangible property by participants or others.
2. Compensation paid to the participant solely or primarily through the recruitment or the introduction of others into the scheme, plan, management or the chain pyramid process as compared to the sales of products, services or intangible property by participants or others.

Minor features :-

1. A written contract or statement describing the material terms of the agreement, which is not available to participants who joined the scheme, plan, control, or the chain pyramid process.
2. Purchase of products, services or intangible property or the minimum payment or compulsory purchase is a condition to meet the qualification requirements or initial requirements for participation or compensation in the scheme, plan, or the operation of the chain pyramid process.
3. Participants are required to purchase the products, services or intangible property in an unreasonable amount exceeding the expected resale or purchase within a reasonable period of time. Participants were not given absolute/complete freedom in the purchase, but they are forced to buy selected packages of products to meet sales requirements, in order to qualify them in gaining a position or a bonus in the scheme, plan, control, or the chain pyramid process.
4. The policy for products payment, services or intangible property acquired by the participant or user is not available.
5. The policy of buying back by scheme operators, plan, control, or the chain pyramid process for products, services or intangible property that gets capture the market at this time at the request of participants in reasonable terms or agreements are not allowed or available.
6. Strict or unreasonable requirements for the structure of the scheme, plan, management or chain pyramid process for the eligibility of participants to be compensated.
7. The withdrawal by the participants from the scheme, plan, management or the chain pyramid, is not allowed.
8. Participants are allowed or encouraged to buy more than one position or the right to participate in the scheme, plan, management or the chain pyramid process.

1. Multi-level

   The company recruits / appoints an individual as a member / distributor to distribute its products. Member / distributor then appoints another individual (downline) to form a network to sell the company’s products. The process of recruiting new distributors can be continued until a reasonable level. Each member / distributor will receive a commission / bonus / incentive from personal sales and sales members / distributors under his/her network (overriding bonus)

2. One level

   The company will appoint dealers / agents and pay salaries / commissions / a combination of salary and commissions based on sales made. Sales representatives / agents are not allowed to appoint/ to sponsor other sales representatives / sales agents.

3. Sales through mail order

   Sales of goods or services by mail, performed by any individuals, whether for themselves or through any individuals authorised.

For new applications, applicants are required to submit the following documents:

1. The duly completed ATS.1/2011 form;
2. A copy of Company Registration (Form 9, 24 and 49) / Business Registration (Form A and D) / Form 1 and 2 / Business Licence Ordinance.
3. A copy of applicant’s identification card; and
4. Copy of Certificate of Business License Workshop from PBT for License to make, repair and sell (PBJ) and license to repair and sell (BJ)
5. Letter of support from provider of weights and measures; and
6. Copy of certificate for qualifications / skills / approvals related to weights and measures.

For application renewals, applicants are required to submit the following documents:

1. Duly completed ATS.2/2011 form;
2. An original licence of weights and measures; and
3. A copy of Company Registration (Form 9, 24 and 49) / Business Registration (Form A and D) / Form 1 and 2 / Business Licence Ordinance.
4. Annual Financial Report / 3 months latest sales record.

“Direct Sale” means a door-to-door sale, a mail order sale or a sale through electronic transaction within the meaning of Direct Sales and Anti-Pyramid Scheme 1993;

 “Door-to-door sale” is described as the sales of goods or services performed in the following manner:

1. a person or any person authorised by him :-
   1. goes from one place to another place other than a fixed place of business, or
   2. makes telephone calls, seeking out persons who may be prepared to enter, as purchasers, into contracts for the sale of goods or services; and
   3. Find people who are willing to enter into contracts as buyers for sale of goods or services
2. that first-mentioned person or some other person then or subsequently enters into negotiations with those prospective purchasers with a view to the making of such contracts;

“Mail order sale” means the sale of goods or services which a person conducts, either by himself or through any person authorized by him, by receiving an offer for a sale contract by mail or any other means of mailing including through electronic.

“Sales through electronic transaction” means sales of goods or services through electronic means by using marketing networks with the purpose of getting commission, bonus or any other economic advantage.

E-commerce via the Internet can be broken down into three forms, namely:

1. Business to Business (Business to Business, B2B)

   Transactions occurred between the two businesses. For example, suppliers of raw materials to manufacturers who use raw materials to produce final goods.

2. Business to Consumer (Business to Consumer, B2C)

   Where the transactions occurred between dealers and end users of the goods.

3. Consumer to Consumer (Consumer to Consumer, C2C)

   This is a personal transaction among such individuals through auction websites like eBay.

Any scheme or arrangement for the distribution / sale of commodities in which a person gets a rewards or the opportunity to receive the interest money that is not dependent on the amount or quantity of goods or services sold or distributed, but it is based on the promotion / introduction of one or more participants into the scheme.

1. Check whether the company has a valid licence issued by any relevant authority.
2. If the company is a direct selling company, please refer to the Ministry of Domestic Trade and Cost Of Living on whether the company has a legitimate direct selling licence. Sales license numbers begin with “AJL 93xxxx’. Revisions can be made through the Ministry’s website: http://www.kpdn.gov.my/
3. Review the marketing plan and make reference to the Direct Sales Unit, Ministry of Domestic Trade and Cost Of Living on regarding the validity of the submitted plans.
4. Make a report immediately to authorities.

The license shall make a written application to the Optical Disc Controller by submitting detailed information on the machines to be upgraded such as the machine brand, mould serial number and manufacturer’s code used.

Applicants must also submit an application for reasons to upgrade the machine

License Type	Annual Fee Pay (RM)
License to manufacture, repair and sell the weighing and measuring instruments (PBJ)	RM 200.00
Licences to repair and sell weighing and measuring instruments (BJ)	RM 100.00
License to sell weighing and measuring instruments (J)	RM 50.00

Payment must be made in the form of bank draft, postal order or money order made payable to the Chief Inspector of Weights and Measures.

1. Direct selling with gifts by the “scratch and win” and “lucky draw” to invite the buyer to purchase goods on offer. The prizes offered are usually not made available directly or available as offered.
2. Organiser uses “door-to-door” tactics or invitations through cards or letters to the public to take a free gift. Prizes on offer are actually not free but required the buyer to purchase other goods where the price includes the cost of goods on offer.