XN000022-1980-06-11 — Page 8

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WEDNESDAY, JUNE 11, 1980

+THE GOODS ARE FORGOTTEN AS THE SALESMEN MULTIPLY, YET EACH NEW RECRUIT IS PROBABLY HAVING TO BUY FROM THE ORGANISERS A FIXED QUANTITY OF GOODS TO SELL, HE SAID,

THE SITUATION MIGHT END WITH THOSE AT THE TOP OF THE PYRAMID BEING RICH AS THE RESULTS OF SELLING THE RIGHT TO SELL AND THE GOODS THAT WERE TO BE SOLD, HE SAID.

+AS WE LOOK DOWN THE PYRAMID THE PARTICIPANTS APPEAR TO BE LESS WELL OFF UNTIL WE FIND AT THE BASE A LARGE NUMBER OF SALESMEN WHO HAVE PAID FOR THEIR POSITION ON THE ONE HAND AND HAVE NO ALTERNATIVE BUT TO SETTLE DOWN AND SELL THOSE LONG FORGOTTEN GOODS ON THE OTHER, MR JEAFFRESON ADDED.

MR JEAFFRESON POINTED OUT THAT THERE WAS EVIDENCE THAT THE HIGH PRESSURE RECRUITING TECHNIQUES ADOPTED BY SOME COMPANIES TENDED TO ATTRACT GULLIBLE YOUNG PEOPLE WHO HAVING JUST LEFT SCHOOL, WERE DRAWN BY PROMISE OF RICHES WITHOUT HAVING THE MATURITY TO DISTINGUISH THE SNARES.

+OUR CONCLUSION IS THAT WE ARE IN A SITUATION IN WHICH THESE YOUNG PEOPLE LACKING THE MATURITY TO RESIST THE LURES OF THE RECRUITERS PERHAPS CANNOT BE EXPECTED TO PROTECT THEMSELVES,+ HE SAID.

+SO WE JUST ABOUT HAVE A SITUATION WHICH MEETS OUR CRITERION FOR INTRODUCING LEGISLATION TO PROTECT THEM,+ HE ADDED.

BUT MR JEAFFRESON SAID THERE HAD BEEN GREAT DIFFICULTY IN DEVISING A DEFINITION THAT DID NOT INADVERTENTLY OPERATE AGAINST REPUTABLE DIRECT SELLING ORGANISATIONS NOT USING PYRAMID SELLING TECHNIQUES.

*TO THIS END, WE HAVE CONSULTED A NUMBER OF ORGANISATIONS, INCLUDING THE CONSUMER COUNCIL, THE DIRECT SELLING ASSOCIATION, THE LAW SOCIETY, THE BAR ASSOCIATION AND THE HONG KONG SOCIETY OF ACCOUNTANTS, AND HAVE ALSO DRAWN HEAVILY ON THE EXPERIENCE OF COUNTRIES THAT HAVE LEGISLATED AGAINST PYRAMID SELLING,+ HE SAID.

POINTING OUT THAT IT WAS A TRICKY AREA IN WHICH TO INTRODUCE LEGISLATION, MR JEAFFRESON SAID: IF IN PRACTICE WE FIND WE HAVE NOT GOT IT QUITE RIGHT, WE MAY HAVE TO COME BACK TO THIS COUNCIL TO AMEND THE DEFINITION.

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