（Promulgated by the State Council on 23 August 2005 and effective as of 1 November 2005.）
颁布日期：20050823 推行日期：20051101 颁布单位：国务院
PART onEGENERAL PROVISIONS
Article 1These Regulations have been formulated in order to prevent fraud， protect the lawful rights and interests of citizens， legal persons and other organizations， safeguard the economic order of the socialist market and maintain social stability.
Article 2For the purposes of these Regulations， the term pyramid selling means acts that interfere economic order and affect social stability by which an organizer or operator recruits personnel and seeks illegal benefits by means of calculating and paying remuneration to the recruited personnel on the basis of the number of personnel directly or indirectly recruited by them or their sales performance， or requiring the recruited personnel to pay certain fees as a condition of being qualified for participation.
Article 3Local peoples governments at and above the county level shall strengthen their leadership in investigating and handling pyramid selling， and support and urge the relevant departments to perform their regulatory duties in accordance with the law.
Local peoples governments at and above the county level shall set up such mechanisms as required for coordination in investigating and dealing with pyramid selling and provide timely coordination and solution to major issues that arise in investigating and handling pyramid selling.
Article 4The administration for industry and commerce and the public security authority shall investigate and handle pyramid selling within their respective scope of responsibilities in accordance with the provisions hereof.
Article 5While investigating and handling pyramid selling in accordance with the law， the administration for industry and commerce and the public security authority shall adhere to the principle of integrating education with punishment， and educate citizens， legal persons and other organizations to conscientiously abide by the law.
Article 6Every work unit and individual has the right to report pyramid selling act to the administration for industry and commerce and the public security authority. Upon receipt of such report， the administration for industry and commerce and the public security authority shall immediately investigate and verify the case and handle it in accordance with the law， and shall keep the identity of the informant confidential. If a report is proven to be true upon investigation， the informant shall be granted a reward in accordance with the relevant State provisions.
PART TWOTYPES OF PYRAMID SELLING AND THE INVESTIGATION AND HANDLING AUTHORITY
Article 7The following acts are pyramid selling acts：
1. an organizer or operator seeks illegal benefits by recruiting personnel， requiring the recruited personnel to recruit other personnel to participate， and calculating and paying remuneration （here and hereinafter including material rewards and other economic benefits） to the recruited personnel on the basis of the number of personnel directly or indirectly recruited by them through rolling recruitment；
2. an organizer or operator seeks illegal benefits by recruiting personnel and requiring the recruited personnel to pay fees， or fees in disguised forms such as order of commodities， as a condition to being qualified for participation or recruiting other personnel to participate； and
3. an organizer or operator seeks illegal benefits by recruiting personnel and requiring the recruited personnel to recruit other personnel so that an upline-downline relationship is formed， and calculating and paying remunerations to an upline personnel on the basis of the sales performance of his downline personnel.
Article 8The administration industry and commerce shall be responsible for investigating and handling the pyramid selling acts specified in Article 7 hereof in accordance with the provisions hereof.
Article 9Where media such as the internet are utilized to dis百度竞价推广inate information of pyramid selling specified in Article 7 hereof， such case shall be investigated and handled by the administration for industry and commerce in conjunction with other relevant authorities such as the telecommunications authority in accordance with the provisions hereof.
Article 10If anyone in pyramid selling deceitfully lures other personnel in the name of job referral and engagement in business activities， etc. to leave their place of residence to illegally gather in another place and restrict their personal freedom， such case shall be investigated and handled by the public security authority in conjunction with the administration for industry and commerce.
Article 11The relevant authorities and work units such as those in charge of commerce， education， civil affairs， finance， labour security， telecommunications and taxation shall， pursuant to their respective responsibilities and the provisions of the relevant laws and administrative regulations， cooperate with the administration for industry and commerce and the public security authority in their investigation and handling of pyramid selling acts.
Article 12Grass-root organizations such as rural villagers committees and urban residents committees shall， under the guidance of the local peoples government， assist the relevant authorities in investigating and handling pyramid selling conduct.
Article 13If， in investigating and handling pyramid selling acts， the administration for industry and commerce suspects that an act may constitute a criminal offence， it shall transfer the case to the public security authority to be put on file for police investigation. If a case of pyramid selling put on file for police investigation by the public security authority is found after police investigation not constituting a criminal offence， the case shall be transferred to the administration for industry and commerce for investigation and handling.
PART THREEMEASURES AND PROCEDURES FOR INVESTIGATION AND HANDLING PYRAMID SELLING
Article 14Administrations for industry and commerce at the county level or above may adopt the following measures when investigating and handling suspected pyramid selling acts：
1. order the cessation of the relevant activities；
2. investigate and understand relevant circumstances from the suspected pyramid selling organizer， operator and individual；
3. enter the business premises and venues for training and as百度竞价推广bly activities that are suspected to be involved in pyramid selling to conduct on-site inspection；
4. inspect， reproduce， seal up or distrain materials such as contracts， instruments and account books that are suspected to be related to pyramid selling；
5. seal up or distrain property such as products （commodities）， tools， equipment and raw materials that are suspected to be used specifically for pyramid selling；
6. seal up the business premises that are suspected to be involved in pyramid selling；
7. inquire the accounts of the suspect pyramid selling organizer or operator and the accounting vouchers， books and statements relating to their deposits； and
8. apply to the judicial authority for freezing the illegal funds where there is evidence in support of the transfer or concealment of such funds.
To adopt the measures stipulated in the preceding paragraph， the administration for industry and commerce shall report in writing or verbally to and obtain approval from the principal person in charge of the administration for industry and commerce at the county level or above. In emergencies that require adoption of the measures set out in the preceding paragraph on-the-spot， a report shall be made and the relevant procedures shall be completed immediately after the incident. If sealing up or distrainment stipulated in the preceding paragraph or the measures stipulated in Items （7） and （8） above are to be enforced， prior written approval shall be obtained from the principal person in charge of the administration for industry and commerce at the county level or above.
Article 15When the administration for industry and commerce investigates and handles suspected pyramid selling acts， there shall be no less than two enforcement officers.
