Members’ Rules & Regulations

Members’ Rules & Regulations

1. Introduction

These R&R are implemented with the purpose of safeguarding the rights and regulating the obligations of Elken members (“Members”) rather than restraining your independent business activities. In order to mould yourself to be a responsible and ethical Member, you must understand and abide by the R&R, which have the objective of building a healthy business networking environment for your long term and profitable business; promoting unity and positive harmony amongst fellow Members; and between Members and Elken International Sdn. Bhd., Taiwan Branch (“Company”). Your strength and success as Members are a collective effort, founded upon the enduring partnership of commitment and trust that exists between Company and our Members.

It is the responsibility of each Member to; (i) read, understand, adhere to and ensure that he/she is aware of and operating under the most current version of the R&R; (ii) update his/her contact details and correspondence/e-mail addresses as Company will send communications to Members’ last known address and contact details as captured in its database. Each Member agrees that the relationship between a Member and Company is entirely contractual. Accordingly, Company will not recognise any claim by a Member that the relationship is or has been quasi-contractual, has arisen by implication from any continuing practice or course of action, has been verbally authorised by any employee of Company in contradiction of the R&R or policy, or is otherwise implied in fact or in law.

These R&R in their present form and as amended by Company from time to time are incorporated into and form an integral part of the Member Application Form and constitutes part of the agreement between Company and the Members (“Agreement”). Failure to comply with any of the provisions herein may result in termination of your membership.

1.1 Member’s Code of Ethics

All Members are required to observe the Member’ Code of Ethics at all times, of which is set forth as follows:

  1. I will follow the highest standard of honesty and integrity in conducting the ELKEN Business.
  2. I will abide by the R&R, policies, Code of Ethics, Company’s procedures and directives at all times.
  3. I will actively train and encourage my downlines towards succeeding in ELKEN business.
  4. I will not resort to any fraudulent act in promoting Company’s business at the expense of Company, fellow Members and direct selling industry.
  5. I will present Elken Global Compensation Plan accurately and honestly, clearly portraying the level of efforts required to achieve success.
  6. I will not take advantage the goodwill of Company to promote other businesses ventures/interests, whether directly or indirectly in competition with or in conflict with Company’s interest.
  7. I will not make negative or disparaging remarks about Company, its employees, officers, directors or denigrate other company’s products, marketing plan or any other features of another company. I will be respectful to Company and to the direct selling industry as a whole.
  8. I will not retail Company’s products (“Products”) at below or above the prescribed prices authorized by Company.
  9. I will not make any payment or promise to pay any prospect or Member in return for membership recruitment or enrolment activities.
  10. I will not use Company’s trade name(s), information, literature, advertising material and gathering of people or other Company’s resources to enhance other business interests or purpose not authorized by Company.
  11. I will continuously strive to ensure that my customers and fellow Members are satisfied with Products and my service.

1.2 Independent Contractor Status

  1. A Member is an independent contractor and shall not imply or represent himself/herself to others as a franchisee, partner, employee, agent or authorised representative of Company and accordingly shall not have the right to negotiate or conclude any contract on behalf of Company or hold himself/herself as having such a right.

2. Becoming a Member

2.1 Eligibility

  1. Any individual who is of legal age and residing in Taiwan can apply to be a Member by completing the Member Application Form via online.
  2. Upon completion of the Member Application Form, he/she is required to submit the same to Company together with the following documents for processing within 30 days from the date of Member online submission of the Form:-
    1. Duly completed and signed Member Application Form; and
    2. A copy of his/her identity card or residence permit and valid passport.
  3. Any application in the name of a company or a third party will not be accepted and entertained.
  4. Company reserves the right to accept or reject any application without assigning any reason whatsoever.
  5. Member e-wallet shall only be activated upon Company is in receipt of the documents specified in Clause 2.1(b) (i)&(ii) above.
  6. A Member must not be an existing agent, representative, employee or spouse of an employee of Company.
  7. All applications must be sponsored by an existing authorised Member.
  8. All Memberships are single memberships. A Member may own or have an ownership interest in only one membership except as where an existing Member purchases another membership.
  9. Married couples are allowed to maintain two separate memberships under the same line of sponsorship provided they are directly sponsored by his/her spouse.

3. Term and Renewal

3.1 Term

  1. Upon registration of the membership, membership is valid for a term of 52 weeks. Membership will only be activated upon qualifying for activation requirement stipulated under the Elken Global Compensation Plan.
  2. Member is entitled to rescind/terminate this Agreement upon 30 days written notice by way of official letter to Company from the joining date or through resignation from his/her membership at anytime, after which a Member’s downlines shall be transferred to his/her upline/sponsor.
  3. A Member may reapply to be a new Member upon the expiry of his/her membership (i.e. 52 weeks from last purchase or 6 months after Company receives his/her written resignation letter), whichever is earlier.

3.2 Renewal

  1. A Member is required to renew his/her Membership annually by paying a renewal fee of TWD330 on or before the expiry of the 52 weeks from joining/purchase date.

4. Sponsoring & Placement Change/Correction

4.1 Principle of Sponsorship

  1. It is against Company’s policy for any Member to change sponsor through any means. Any application submitted with the intent to change sponsors will be rejected except due to the Member placement error and subject to the condition specified in Clause 4.3 below.
  2. It is against Company’s policy for a Member to be sponsored under two or more memberships. Such conduct will result in his/her membership being terminated.
  3. Application for the change of sponsor or any change in placement (with exception to Clause 4.4) or change of the entire personal group is strictly not prohibited.

4.2 Cross-Sponsoring

  1. No Cross-Sponsoring of membership shall be allowed. Cross-Sponsoring in this context means:
    1. Signing up an existing Member or any person from another group or sideline, which is not within his/her direct line of sponsorship in Company or from Company’s associated, related and affiliated companies within the Elken Group.
    2. Signing up under another sponsor to operate his/her membership when his/her membership is still valid.
    3. Allowing other person or relatives to use his/her membership to conduct business.
  2. In the event of Cross-Sponsoring, the following actions shall be taken:
    1. The membership of Member, who signs up a Member of another group shall be terminated.
    2. All Member involved shall be transferred back to their original sponsor.
    3. If Member “A” is found to have used another person’s or a relative “B’s” membership under another group to carry out business, then “B’s” membership will be terminated and all of “B’s” downline Member shall be transferred to “A”.
  3. In addition, Company reserves the right to:
    1. withhold commission/bonus payment and/or suspend any benefits of the violating Member; and/or
    2. terminate the violating Member at Company’s discretion.

4.3 Rules of Placement

  1. The first 2 placement of Sponsors’ downline is auto placed and Sponsors shall only have the right to place the placement of all subsequent downlines they personally sponsored under his/her existing account within the donwline group.
  2. Sponsors cannot place their downlines in contravention with Clauses 4.1 and 4.2.
  3. In the event the sponsor’s placement instruction from the sponsor is not clear, erroneous, contrary to the R&R (including the Compensation Plan) or no placement instruction given at all or a default placement is made, then the downline account shall be placed in the first vacant position of the sponsor’s account.

4.4 Placement Change/Correction

  1. Upon the current sponsor’s written consent, a Member may request in writing to the Company’s Head Office for a 1 time placement change or correction of sponsor within 3 days from the new Member joining date.

5. Representations & Obligations

5.1 Representations

  1. Members shall not imply or claim that they have exclusive territory in an area in which to recruit and/or sell Products.
  2. Members shall not enroll or attempt to enroll an individual without his/her knowledge or enroll or attempt to enroll a non-existent individual (phantom) as a Member or fraudulently execute a Member Application Form on his/her behalf or to execute any agreement/contract other than Membership Application Form in order to become a member.
  3. Members shall present the official ELKEN Compensation Plan as endorsed by Company and most updated version of the R&R to any prospect/individual whom they are sponsoring to become members before signing the Membership Application Form. Copy these documents are available on Company’s website at www.elkenglobal.com.
  4. Members shall not recruit any prospect to participate in Company’s business opportunity through or in combination with any other program, network marketing scheme or in any manner other than those specifically provided in Company’s official literature.

5.2 Obligations

  1. Members are required to introduce himself/herself and to produce his/her membership ID card before conducting his/her business activities.
  2. Members are required to attend training courses in addition to providing guidance, adequate training and supervision to his/ her downlines and to the Member he/she sponsored to ensure their business activities are conducted and operated in compliance with the provisions of these R&R.
  3. Members, regardless of their rank of achievement have an ongoing obligation to continue to personally promote sales through the introduction of new retail customers to Company and through servicing their existing retail customers.
  4. Members are obliged to provide receipts to retail customers and to keep complete and accurate records of all his/her business dealings.
  5. Members shall be responsible to make tax payment in relation to his/her earnings in accordance with the relevant local tax legislations/regulations.
  6. Members shall comply with all relevant applicable laws, legislations, regulations and ordinances concerning his/her business operations in their respective country of residence.

6. Violation of R&R

6.1 Prohibited Acts

A member shall not:

  1. Incur any liability or debt in the name or on behalf of Company;
  2. Make or modify or alter or discharge any contracts in the name of Company;
  3. Negotiate, or mislead others that they have such right, enter into contracts and/or agreements for and on behalf of Company;
  4. Sponsor or solicit or attempt to sponsor or solicit Company’s Member, employee, supplier, manufacturer, consultant and vendor or anyone into any trade, business or profession whether directly or indirectly in competition with or in conflict with Company’s interest and/or to alter or terminate their employment or business relationship with Company;
  5. Solicit the participation of any Company’s Member, employee, supplier, consultant, manufacturer, and vendor to purchase or sell any Products other than Company’s or to present other opportunities or to solicit the participation in any other trade, business or profession, whether directly or indirectly in competition with or in conflict with Company’s interest. Notwithstanding the aforesaid, this provision does not apply to businesses/trades conducted by Company’s associated, related and affiliated companies within the Elken Group;
  6. Be engaged in or be interested, whether directly or indirectly or whether as director, shareholder, proxy, principal, agent, servant or license in promoting the interest or opportunity and sale of any Products or goods other than those of Company in any trade, business or profession whether directly or indirectly in competition with or in conflict with Company’s interest. Notwithstanding the aforesaid, this provision does not apply to businesses/trades conducted by Company’s associated, related and affiliated companies within the Elken Group;
  7. Influence existing Member, employee or agent of Company and/or those of its related, associated and affiliated companies to likely cause operational disruption, reputational damages and/or financial losses to Company and its related, associated and affiliated companies;
  8. Be involved in any unauthorized media release or publication of Elken’s corporate-related information (including giving personal interviews) to newspapers/magazines/others whether through any form of mass communication or social media platforms without Company’s prior written approval.
  9. Violate any terms stipulated in the R&R, Code of Ethics, Company’s policies, procedures, directives, any applicable laws and regulations, including but not limited to those all rules and regulations relating to Multi-Level Marketing Supervision Act (“MLMSA”) and Personal Information Protection Act (“PIPA”).

6.2 Reporting of Violation

  1. It is the obligation of every Member to abide by and uphold the integrity of the R&R.
    If a Member observes another Member committing any violation, he/she shall report such violation to Company by providing details and evidence pertaining to the nature of the alleged violation to Company’s Customer Service & Support Department.

6.3 Rectification, Suspension and Termination Procedures due to Violation of R&R

  1. Violation of R&R is a serious issue and constitutes a breach of the Agreement by a Member. It is likely to cause a negative impact not only on the involved Member’s business, but also on other Members’ businesses. At the same time, it may cast a dishonourable image and negative impression on Company, its Members, business partners, officers, shareholders, Board of Directors and agents to the media, relevant authorities and general public.Company provides guidance and advice in rectifying any violation and when the severity of the situation warrants, it shall take appropriate action against the Member involved. In the event of violation, the following procedure shall be observed:
    1. Upon any violation of the R&R, a written complaint has to be lodged immediately with Company. The complainant may email the Customer Service & Support Department, giving details and evidence pertaining to the nature of the alleged violation. The complainant must also inform his/her upline about the complaint lodged against the Member concerned.
    2. Upon receiving the complaint, Company shall notify the Member concerned, demanding a swift response and give him/her the opportunity to explain himself/ herself regarding the alleged violation
    3. In the event Company finds that the information provided by both the complainant and/or the Member concerned is inadequate, Company reserves the right to request for more details from them. Company may at any point in time withhold commissions under the Elken Global Compensation Plan and any Products campaigns and incentives, or withdraw facilities and privileges of the Member (if any) pending the final outcome of the investigation.
    4. Upon securing all details pertaining to the alleged violation as claimed by the complainant, Company shall talk to the Member concerned, ensuring that the violation is not repeated. If necessary, the complaint lodged shall also be submitted for further discussion by Company in consultation with the Management.
    5. Upon accessing the facts, gravity and any circumstantial damage caused by the violator’s breach of Membership Application Form or R&R and Company acting on the principle of impartiality may suspend or terminate the membership of the Member concerned, by giving written via registered mail to the last known address of the Member as captured in Company’s database. The postmark shall be taken as the proof of receipt.
    6. In the event of suspension, a brief description of the complaint lodged against the suspended Member shall be stated, in addition to spelling out the necessary steps in rectifying his/her behaviour as well as the deadline for their compliance.
    7. Failure on the suspended Member part in rectifying his/her behaviour within the deadline stipulated shall eventually lead to the termination of his/her membership.
    8. Company reserves the right to take necessary actions against the terminated Member and demand any compensation for damages and legal costs incurred, if any.
    9. Company reserves the right to amend or change any part of the above procedure when necessary without giving prior notice.

6.4 Effects of Suspension and Termination

  1. A Member may choose to suspend his/her membership with written notice to Company. In doing so, the Member must wait until the membership expires (52 weeks from last purchase) before reapplying to be a Member.
  2. Refusal of delivery or a request for return of the Products previously purchased for refund shall be deemed as self-suspension.
  3. Any Member whose membership has been suspended or terminated:- (i) is not permitted, either directly or indirectly, to enter into the premises of Company, purchase Products, hold and attend meetings and incentive trips, participate in the building, sponsoring or development of any of Company’s Members and prospects; (ii) shall cease to identify himself/herself as Company’s Member; (iii) shall no longer be entitled to the status of his/her membership and all of ELKEN’s Compensation Plan, benefits and entitlements. (Standing orders for future purchases will be terminated and Company may refund the unutilised funds (if any) after deduction of administrative charges and shall have no further claims whatsoever against Company; (iv) subject to Company’s discretion, his/her downline organisation shall be transferred to his/ her direct sponsor; (v) shall covenant not to influence existing Member, employees or agents of Company or those of Company’s related, associated and affiliated companies in such manner that may cause operational disruptions, reputational damages and financial losses to Company and/or its related, associated and affiliated companies.
  4. Company reserves the right to claim damages from the suspended or terminated Member if he/she is in breach of the R&R or has participated in any other actions that may cause losses in terms of financial or otherwise to Company.
  5. A Member, who has resigned or been suspended or terminated can reapply for a new membership after his/her resignation, suspension or termination subject to Company’s approval and Clause 3.1 (d). Any person reapplying to become a Member of Company shall not lay claim to any of his/her bonuses/ incentives, ranks or positions, which he/she enjoyed or held prior to his/her suspension/termination or resignation.

7. Sale & Succession of Membership

7.1 Sale of Membership

The sale of membership is subject always to Company’s Head Office prior written approval and upon fulfilling the following conditions:

  1. Only a membership in good standing with Company and having the rank of 3 Star Diamond and higher and not in violation of the R&R may be sold. Member must write in to Company for its prior written approval before any sale of membership can be made. Approval is based on the review of the proposed purchaser’s qualification and intention to manage and will be subject to the consent and approval of Company.
  2. The sale of the membership follows the below preferential order:
    1. First priority
      The Member immediate sponsor
    2. Second priority
      Any upline Member
    3. Third priority
      One of the 3 Star Diamond’s downlines sponsored by the Member
    4. Fourth priority
      One of the Member in Company with the rank of 3 Star Diamond and above
  3. Upon obtaining written approval of the sale from Company, a sale and purchase agreement must be signed between the buyer and seller. A transfer fee of TWD1650 together with a copy of the duly stamped sale and purchase agreement must be extended to Company for safekeeping.
  4. Any Member who has sold his/her membership can only apply to join as Company’s Member after one year from the date of the sale. Accordingly, he/she will start from the very beginning with no link to any previous downlines.
  5. All bonuses accrued to the previous membership will be paid to the new owners. The awards and recognition previously awarded to the membership will be transferred to the new owner, if the new owner is presently a Member of Company. However, the new owner has to attain the required qualification before he/she is entitled to acquire any due awards and recognition of the transferred membership.
  6. Selling and buying an existing membership as a means of changing membership is generally discouraged. Company will closely scrutinise such transactions for violation of other important policies.

Company reserves the right to disapprove any sale of membership without having to give any reason. Any effort to circumvent compliance of this section will render the transfer to be declared null and void.

7.2 Succession

  1. Upon the demise, incapacity or health problems of a Member, his/her membership shall be transferred to the Member beneficiary subject to Company’s Beneficiary Policy and relevant laws of the country concerned.
  2. Where a Member (being a transferor), in order to facilitate the transfer of a membership in the event of his/ her death, requests the name of another transferee to be included into his/her membership. The transferee must be his/her next of kin, namely his/her spouse, parent, child, or immediate brother or sister, and the transfer has to be supported by relevant supporting documents to evince the same. The name of the transferor must continue to remain in the membership until his/her death and supporting estate-planning documentation must be provided to Company before change is effected. Such transfer shall be subject to such terms and conditions as may be imposed by Company and Company’s prior written approval and whose approval may at any time be withdrawn without any notice to that Member.

8. Product Sales and Pricing

8.1 Sales Representation

  1. The integrity of ELKEN’s Compensation Plan and the confidence of other Member shall be upheld at all times as such Members shall present Products and ELKEN’s Compensation Plan truthfully and accurately.
  2. Members shall not disseminate or spread any misleading, inaccurate and untruthful information or make any disparaging comparisons/statements, whether directly or by implication about Company and/or its related, associated and affiliated companies through any communication platform. Any comparisons/statements made by Members shall be used in context based on relevant and substantiated facts and not unfairly select facts that distort the truth.
  3. Members shall not claim, represent, and imply directly or indirectly, that Products other than those found in current Company literature and/or labels. If the reputation of Company is damaged for this reason, the Member concerned will be held responsible for all costs or damages arising from such action. Furthermore, they shall not bind or commit Company to any settlement related to such costs or damages.
  4. It must be made clear that Company’s programme is based on sales of Products and not for recruitment or rank advancement in Elken Global Compensation Plan. It shall be stated that sales commissions are generated through diligent and committed efforts and Members are not allowed to exaggerate any income claim.
  5. All statements regarding Product description and use must conform in every way to the written policies of Company.
  6. Members shall not request any prospective members to purchase/make payment to any individual/entity or to impose minimum purchase or compel prospective members to purchase more Products than they can reasonably sell, use or maintain a specific amount of Products before joining Company.
  7. Members shall only use credit cards with their own name embossed on the credit card for any purchases and shall ensure the credit card information is accurate and there are sufficient funds for such transaction.

8.2 Pricing

  1. Members shall sell Products to customers at the Consumer Retail Price (CRP). Only Members can enjoy Products at the Member Price (MP) and those offered as Company’s official promotional packages.
  2. Members shall not under-price or over-price any Products for the purposes of gaining higher profits or promoting sales. This action may warrant termination and/or legal action against the violators by Company.
  3. Under-pricing or over-pricing in the above context means:
    1. All Products shall be sold at the price prescribed or approved by Company. No Member is allowed to raise or lower the price of any Products.
    2. No Member is allowed to carry out their own promotion unless with Company’s prior written approval.
    3. Products obtained during promotions or with purchase offers shall be sold at the price prescribed or approved by Company.
    4. Member is not allowed to instigate, encourage, indulge or teach downlines to obtain a bonus rebate/refund of commissions in order to be more competitive in pricing.
    5. Member is not allowed to resell Products to his/her downlines, sidelines and other groups without the submission of a sales report to Company.
    6. Member is not allowed to purchase/sell to the staff of Company and vice versa.

9. Product Guarantee & Refund

9.1 Retail Products Assurance

In the event of dissatisfaction with Products, manufacturing or packaging defects (“Defective Products”), Customers are entitled to return/exchange Products within 90 days from the date of purchase. Defective Products shall be returned in its original, un-open and re-sellable condition, together with the original sales invoice/receipt as well as reasons of returning the Defective Products to be forwarded to Member’s customers. Thereafter, within 90 days from purchase date, such Member is obliged to assist retail Customer to return the Defective Products to Company and refund or exchange for similar Products.

Upon return of Defective Products, Member is required to provide the following to Company:-

  • Product Return Form (reasons for return);
  • Copy of original Invoice/Cash Order;

However, this guarantee only applies to Products that were purchased through Company’s official website and/or from Members. Expired Products or damaged Products due to negligence, misuse, unintended use, mishandling or unauthorized modification are not accepted.

9.2 Return of Products

Upon Member’ resignation or termination of his/her membership, Member may return Products within 180 days from the purchase date provided always that Products is in good condition, useable, re-sellable, unopened, unaltered and the shelf-life of Products have not expired. Upon refund approval being granted, Company shall refund the amount less total bonus paid on the sales purchase, benefits/incentives and 10% service charge from Member’s Products price. Members are advised not to buy Products exceeding their reasonable monthly sales within 180-day period. Members shall endeavor to provide recommended guidelines to thier downline so that they only purchase required amount of Products for sales.

9.3 Products Exchange

In the event of any Products exchange, Members shall abide to the following:-

  1. Defective Products or packaging defect
    Within 30 days from issuance of sales invoice, Members are allowed to exchange defective Products with similar Products. If Products are exchanged within 7 days from purchase date, Members do not need to pay for any handling fees. However, if Products is purchased more than 7 days, 10% handling fees shall be payable by Members.
  2. Company reserves the right to decide whether to allow Products exchange or otherwise, if Products are returned in good condition, useable, re-sellable, unopened, unaltered and the shelf-life of the Products have not expired.

9.4 Cancellation or termination of membership and refunds

  1. Members shall inform Company in writing in the event of any resignation or termination of their membership, return of Products shall be deemed as termination of membership at anytime for whatsoever reasons.
  2. Within 30 days of membership date, Members are entitled to resign or terminate their membership by giving 30 days written notice to Company. 30 days after cancellation or termination of the membership, Company shall accept Members’ Products Return Form, collect or accept Members’ Products and Company shall refund payments made by Members for the purchased Products and any other relevant fees paid to Company. Company is entitled to deduct the returned Products value due to any loss or damages, Members’ bonus/incentive as well as shipping, transport cost, if the returned Products are collected by Company.
  3. After the lapse of 30 days from membership date, Member is entitled to resign or terminate his/her membership at any time by serving a written notice to Company stating reasons for such business withdrawal and return the Products to Company. Members are not entitled to return Products to Company if the Products were delivered or collected within 6 months from delivery/collection date. Company shall buy back all Products purchased by the Members at the rate of 90% calculated on the original Member Price. Prior to the refund payment, Company shall deduct any commissions/bonuses paid to the Members and taking into consideration of the decreased Products value and any shipping, transport cost and expense, if returned Products are collected by Company.
  4. Pursuant to Articles 20 and 21 of the Act (as defined herein), upon Members’ cancellation of termination of their membership, Company shall not claim for any damages or penalties against the Members. If Products were supplied by 3rd party, Company shall handle the returned Products and repurchase of Products accordingly and shall pay for the damages or penalties incurred by 3rd party and charge the Members accordingly.
  5. Member is prohibited from improperly obstruct customer from returning Products. At the time of cancellation or termination of the Members’ membership, Company shall not improperly withhold any Members’ incentives/commission, entitlement, bonuses or other benefits.
  6. Company reserves the right to decide whether to attend to any Members’ request pertaining to any returned Products which were claimed by the Members 6 months ago.
  7. Pursuant to the Multi-level Marketing Supervision Act (“Act”), below is the act of non compliance which could result to revocation of membership, punishments may be imposed by Company and Company shall not accept any returned Products if Member:-
    1. deceitfully and fraudulently introduce, promote direct sales Products or compensation plan whilst inciting Members to join his/her network;
    2. deceptively use multi-level business or its relevant network to raise funds;
    3. violation of any public order or local customs so to engage in pyramid scheme activities;
    4. directly or indirectly accept any interviews which could result in customer’s interest; and
    5. violation of the Act or in contempt of any criminal offences or be involved in any pyramid scheme activities.

9.5 Members’ Products Return and exchange

In the event of any Products return and exchange, Members shall:-

  1. inform Company via telephone calls or facsimile;
  2. submit the returned or Products exchange to Company together with the original sales invoice or Products Exchange Form and Sales Return Form;
  3. return the Products using appropriate shipping carton and packaging materials;
  4. Members are entitled to return Products to Company provided that they purchased the Products from Company; and
  5. Company shall not be responsible and liable for any returned Products which are lost in transit.
    Products Discount Schedule (Suitable for Members dealing with Products return)
Return Condition Return Period Deductible Loss Of Value Relative Amount To Be Returned Required Documents
Retail Customer Within 30 days from purchase date 0% 100% Returnable Products
Post 30 days from purchase date Members are prohibited from returning purchased Products
Handling Of Products Return Within 1-30 days from date of invoice 0% 100%
  • Returnable Products
  • Original Invoice
  • Products Return Form
  • Duly completed and stamped Sales Return Form
    		•
    Within 31-45 days from date of invoice 30% 70%
    Within 46-90 days from date of invoice 40% 60%
    Within 91-180 days from date of invoice 50% 50%
    Within 181 days from date of invoice Company shall not accept any return of Products

    Notes:

    1. Expired Products, old packaging or obsolete Products are not accepted for Products exchange as these Products are unable to resell, as such, such circumstances will detract 100% of the value of Products.
    2. Company shall not accept any Products exchange if Products have been opened/ security seal is damaged.
    3. If free gifts were given during Members’ purchase, upon Products returned, such free gift shall be returned with the returned Products, original invoices and documents. If delay is due to incomplete documents, Members shall be responsible for all loss incurred and any return postage shall be borne solely by Members.
    4. In the event of any discrepancies or Members return Customer’s Products without obtaining his/her written consent, Members are deemed to be violating the R&R where Company reserves the right to reject Products return application.
    5. If the return Products impact Members’ eligibility in taking part in any contest, Company reserves the right to deduct fees incurred together with any bonuses or prize granted by
      Company.
    6. This provision shall take effect and commence from 1st June 2016 onwards.

    10. Trademark, Advertisement & Social Media

    10.1 Trademark

    1. Apart from the printed materials that Company may supply and/or sell to Member, a Member should not use the name of Company, its logos, trademarks, and/or other representation of Company without Company’s prior written approval.
    2. Upon expiration, suspension/termination of a membership, the affected Member:
      1. Shall discontinue the use of all Company’s logos, trademarks, and/or any other representations; and
      2. Shall not use any name, sign, label, stationery, Product name, copyrights, designs and/or any printed material related to any of Products.
    3. Members may not register or use any of Company’s names, trademarks, logos “Elken” and product names in any website, URL (Uniform Resources Locator) address, domain name, electronic media advertising or other forms of advertisement.

    10.2 Advertisement

    1. Members shall advertise Company’s Products and/or its Compensation Plan with the exact language used in Company’s printed materials.
    2. Members shall obtain Company’s prior written approval before duplicating, reprinting or personalising any of Company’s official literature and materials. Any privately produced promotional materials must be approved in writing by Company prior to its publication.
    3. All products of Company shall be marketed and sold in its original form and packaging. Members shall not alter, relabel, repackage, rebundle, unbundle, sell in loose form, or otherwise change any of Company’s Products or sell any product under any other name or label other than that authorised by Company.
    4. Members shall obtain Company’s prior written approval before selling, participating and displaying Company’s products at trade shows/conventions.
    5. Members shall obtain Company’s prior written approval before participating in any media interviews, respond to any media inquiries and promote product or opportunity through any news report or trade industry publication.

    10.3 Internet and Social Media

    1. Members may promote ELKEN business through Company’s replicating website programme only.
    2. Members may promote and advertise Company’s Products, campaigns, promotions and incentive on their online social media platforms (including but not limited to blogs, forums, sites, Facebook account whether for personal and/or network’s experience sharing or otherwise). Such published information and/or its contents shall comply with Company’s official literature and materials, and Members shall adhere to the Company’s directives, guidelines and the R&R at all times.

    11. Commission and Bonus Payment

    1. All commissions and/or bonuses payable under the Elken Global Compensation Plan is based on the sale of Products and not through recruitment or rank advancement. Only Active and Activated memberships is eligible for commissions and/or bonuses.
    2. All commissions and/or bonuses payable under Elken Global Compensation Plan and any Product campaigns and incentives (if any) shall only be released or redeemed subject to payment of all money whatsoever and howsoever owing or payable or due from the Member to Company or to any subsidiary or related/associated/affiliated companies within Elken Group under any other account whether as borrower, guarantor, assignor, or otherwise with Company or to any subsidiary or related/associated/affiliated companies within Elken Group. The suspended or terminated Member expressly agrees that if any moneys whatsoever and howsoever owing or payable or due from the Member to Company or to any subsidiary or related/associated/affiliated companies within Elken Group under any account whether as borrower, guarantor, assignor, or otherwise with Company or to any subsidiary or related/associated/affiliated companies within Elken Group, Company may at any time have the right to debit the commissions and/or bonuses payable under Elken Global Compensation Plan and any Product campaigns and incentives, or withdraw or forfeit facilities and privileges of the Member (if any) towards satisfaction of any liabilities of the Member due and payable to Company or to any subsidiary or related/associated/affiliated companies of Company within Elken Group.
    3. All weekly commissions and/or bonuses will be paid in the local currency within 21 days after the end of each week’s closing, save for the Quarterly Dividend which will be paid within 21 days after the end of each quarter’s closing. In the event of unforeseen circumstances, there may be a few days of delay due to external factors beyond Company’s control.
    4. The minimum payment for commission is TWD330. Any commission generated less than TWD330 shall be accumulated and paid to the Member until it exceeds TWD330.
    5. Company shall be entitled to charge a fee of TWD660 per Commissionable Cycle for the following where:
      1. No commission activity for a period of 12 months in the Member e-wallet;
      2. Commission payments that is delayed/pending due to the act/omission of Member for a period of 6 months.
    6. Upon receiving weekly Bonus Statements, Member should check to ensure the figures is accurate. Any queries should be made within 14 days from the issuing date of the statements, failing which the Bonus Statement is deemed correct.
    7. Company shall be entitled to adjust all commissions and/or bonuses paid or to be paid as a result of the returned/refund of Products and the commission and/or bonuses shall be adjusted accordingly in the Member’s weekly Bonus Statement.
    8. Member expressly agrees that if any moneys whatsoever and howsoever owing or payable or due from the Member to Company or to any subsidiary or related/associated/affiliated companies of Company or Elken Group under any account whether as borrower, guarantor, assignor, or otherwise with Company or to any subsidiary or related/associated/affiliated companies of Company or Elken Group, Company may at anytime have the right to debit the commissions and/or bonuses payable under Elken Global Compensation Plan and any Products campaigns and incentives, or withdraw facilities and privileges of the Member (if any) towards satisfaction of any liabilities of the Member due and payable to Company or to any subsidiary or related/associated/affiliated companies of Company or Elken Group.

    12. General Provisions

    1. Confidentiality: Member shall neither disclose to third party nor use confidential information including but not limited to genealogy, manufacturer information, commission and sales reports Products specifications or formula and other business and financial information of Company received whether in electronic or written form for any other purpose except as permitted by Company nor directly or indirectly contact or communicate with Company’s supplier, vendor, and manufacturer except with Company’s prior written consent.
    2. Waiver: Failure to enforce or to require the performance at any time of anyone of the provisions of these R&R shall not be construed as a waiver of such provision, and shall not affect either the validity of this R&R or any part hereof or the right of any party thereafter to enforce each and every provision in accordance with the provisions of these R&R. Any waiver by Company can and shall only be effected in writing by the authorised personnel of Company.
    3. Indemnity: Member shall indemnify and hold harmless Company, its shareholders, officers, directors, employees and related/associated/affiliated companies from and against any party’s claim, demand, liability, loss, cost or expense (including, and attorneys’ fees), suit, proceeding howsoever caused whether for contractual breach, defamation, libel or slander, any loss or damages and goodwill arising out of or in any way related to or connect (alleged or otherwise) with a Member’s: (a) activities as Members; (b) breach of terms of the Agreement or R&R; and/or (c) failure to comply with any applicable laws, legislations/regulations or rules relating to Multi-Level Marketing Supervision Act (“MLMSA”) and Personal Information Protection Act (“PIPA”).
    4. Limitation of Liability: To the extent permitted by law, Company shall not be liable for, and each Member hereby releases Company from, and waives all claims for any loss of profits, direct, indirect, special or consequential damages or any other loss incurred or suffered by Member as a result of: (a) breach of Agreement, R&R, Code of Ethics, policies, procedures, directives, terms and conditions of the Business Manual, and/or Elken Global Compensation Plan by Member; (b) Member’s business operations; (c) any inadvertent, incorrect or wrong data or information provided by Member; (d) violation of any copyright in connection with materials provided by Member; or (e) failure by Member to provide any information or data necessary to Company for business operations including but not limited to marketing and promoting of Products and/or the joining and acceptance of any individual as Company’s Member or the payment of commission and bonuses.
    5. Limitation of Damages: To the extent permitted by law, Company, its affiliates, officers, directors, shareholders, employees and other representatives shall not be liable for, and each Member hereby releases the foregoing from, and waives all claims for loss of profits, direct, indirect, incidental, special or consequential or exemplary damages which may arise out of any claim whatsoever relating to Company’s performance or non-performance, act of omission with respect to the business relationship or other matters between the Member and Company whether in contract, tort or strict liability. Furthermore, it is agreed that any damages to the Member shall not exceed and is hereby expressly limited to the amount of unsold Products owned by Member and any commission and/or bonuses owed to Member.
    6. Force Majeure: Company shall not be responsible for delays or failure in performance caused by circumstances beyond Company’s control including but not limited Act of God, to strikes, labour difficulties, fire, war, government decrees or orders, or curtailment of a party’s usual source of supply.
    7. Entire Agreement: This Agreement, R&R and Elken Global Compensation Plan together constitute the entire Agreement between Member and Company.
    8. Notices: Each notice, demand or other communication of any kind whatsoever given/ served by either Company or Member shall be in writing and delivered by electronic communication whether by telex, telegram, e-mail or fax (if confirmed in writing sent by registered mail or by personal service). Any Party may change its address for notice by giving written notice to the other in the manner provided in this section. Any such notice, demand or communication shall deemed to be have been given or served on the date personally served by personal service, on the date of confirmed dispatch if by electronic communication, or other evidence if delivery is by mail.
    9. Changes and/or Amendments: Member shall comply with these R&R, policies, procedures, Code of Ethics, directives and any amendment made by Company from time to time. Company reserves the right to add, amend/change or substitute its Compensation Plan, Terms of Agreement, R&R, policies, procedures, Code of Ethics, directives at any time without prior notice. Amendments will be communicated by Company by publication at Company’s website and shall be effective and binding on the publication date. In the event any conflict exists between the previous documents/policies and any such amendments, the amendments shall prevail.
    10. Should any part of this Agreement be unenforceable (including any provision of exclusion of liabilities), the enforceability of any other part of therein shall remain in full force and effect.

    CHAPTER ONE

    GENERAL PROVISIONS

    Article 1

    This Act is enacted for the purpose of assuring sound transaction order of the multi-level marketing, and protecting the rights and interest of participants.

    Article 2

    The term “competent authority” as used in this Act means the Fair Trade Commission.

    Article 3

    The term “multi-level marketing” as used in this Act means the marketing practice to establish multi-levels organization by having participants introduce new participants into multi-level marketing enterprise, and promote and sale goods or services.

    Article 4

    The term “multi-level marketing enterprise” as used in this Act means the companies, sole proprietorships or partnerships, groups or individuals that conduct overall planning or the carrying out of multi-level marketing activities as referred to in the preceding article.

    A participant of foreign multi-level marketing enterprise or a third party that introduces or carries out the multi-level marketing plans or organizations of such enterprise shall be deemed a “multi-level marketing enterprise” as referred to in the preceding paragraph.

    Article 5

    The term “participants” as used in this Act means persons who may earn commissions, bonuses and other economic benefits by taking part in the plans of a multi-level marketing enterprise and promoting or selling goods or services, and who may earn commissions, bonuses and other economic benefits by introducing other persons to participate, to promote, sell goods or services or introduce more persons.

    The persons who enter into contracts with multi-sale enterprises that after meeting specific conditions such persons may get the qualification to promote, sell goods or services, or to introduce other persons to participate shall be deemed as participants from the time such contracts is entered into.

    CHAPTER TWO

    PROCEDURES OF REPORT FILING FOR RECORD BY MULTI-LEVEL MARKETING ENTERPRISES

    Article 6

    Prior to engaging in multi-level marketing operations, a multi-level marketing enterprise, should prepare a report containing the following items, and apply for record by the competent authority:

    1. the basic information and business places of the multi-level marketing enterprise;
    2. the multi-level marketing plans, and conditions of participation;
    3. the content of contracts that will be executed with participants;
    4. the itemized Products or services, prices, and source;
    5. the evidence of marketing practice in compliance with laws or regulations other than this Act, or having ex-ante approval issued by other authorities, where the compliance or the ex-ante approval is imposed by such laws or regulations;
    6. the calculation methods, criterion, and reasons, when multi-levels sale enterprises deduct the devaluation amount from the price in repurchasing the goods or services pursuant to the later sentence of Article 21.3 or 24 of the Act;
    7. such other matters as may be required by the competent authority.

    When multi-level marketing enterprises fail to provide documents and materials according to the requirements of the preceding paragraph, the competent authority may order them to provide within specific deadlines additional supplemental amendments. If multi-level marketing enterprises fail to provide within specific deadlines additional supplemental amendments, it shall be deemed to not have applied at all, and the competent authority may return their report, and order them to resubmit a complete one for record.

    Article 7

    Except for the following situations, when there is any change in the content of submitted documents and materials, the multi-level marketing enterprise shall report in advance:

    1. For changes of enterprises’ basic information as referred in subparagraph 1, paragraph 1of preceding article, a report is not required except for the change of enterprise’s names.
    2. For changes of enterprise’s names, it should be reported within 15 days after the change is in effect. If multi-level marketing enterprises fail to report the change according to the preceding paragraph, when the competent authority considers it to be appropriate, it may order the enterprises to provide within specific deadlines additional supplemental amendments. If multi-level marketing enterprises fail to provide within specific deadlines such additional supplemental amendments, it shall be deemed to not have reported the changes at all, and the competent authority may return their report, and order them to resubmit a complete one for record.

    Article 8

    The format and process of report referred in the preceding two articles will be prescribed by the competent authority.

    Article 9

    Multi-level marketing enterprises which intend to cease their multi-level marketing operations, shall file a written report with the competent authority prior to cessation, and shall have announcement in each business place to notify participants about their rights and interests to return goods to multi-level marketing enterprises according to participation contracts.

    CHAPTER THREE

    THE PRACTICE OF MULTI-LEVEL MARKETING ACTIVITIES

    Article 10

    Before a participant takes part in the plan or organization of a multi-level marketing enterprise, the enterprise shall inform the participant of the following particulars, and shall make no concealment, false, or misleading presentations:

    1. paid-up capital and gross business volume of the multi-level marketing enterprise;
    2. multi-level marketing plan, and conditions of participation;
    3. laws and regulations relevant to multi-level marketing;
    4. obligations and responsibilities of a participant, and conditions of withdrawal by a participant from the organization or plan, and rights and obligations arising from the withdrawal;
    5. matters relevant to the goods or services;
    6. the calculation methods, criterion, and reasons, when multi-levels sale enterprises deduct the devaluation amount from the price in repurchasing the goods or services pursuant to the later sentence of Articles 21.3 or 24 of the Act;
    7. such other matters as may be required by the competent authority.

    When a participant introduces another person to participate in the organization or plan, such participant shall make no false or misleading presentations on items listed in the preceding paragraph

    Article 11

    When recruiting participants by advertising or other means, a multi-level marketing enterprise shall make it clearly known that it is engaged in multi-level marketing activities; neither may it recruit participants under the disguise of recruiting employees or on other pretense.

    Article 12

    When promoting or selling goods or services or recruiting participants by means of declared cases of success, a multi-level marketing enterprise or its participants shall concretely explain the time periods, benefits obtained, and course of development of such cases, and may not make false or misleading representations.

    Article 13

    A multi-level marketing enterprise shall enter into a participation contract in writings with that who intends to participate in the plan or organization, and the multi-level marketing enterprise shall give the participant an original participation contract.

    The writings referred to in the preceding paragraph may not be in the form of an electronic document.

    Article 14

    The content of written contract should include the following:

    1. matters referred in of Subparagraph Articles 10.1(2)-(7);
    2. breaches of contract by the participants and the measures to the breaches;
    3. rights and obligations as referred in Articles 20-22, or the provisions that is more beneficial for participants;
    4. method for handling a request by a participant to return goods, when the contract is terminated because of participants’ violation of business rules or plans, or breaches as referred in Article 15.1, or other reasons attributable to participants; and;
    5. conditions for renew of contracts and the method of handling, when the contracts stipulate specific term of participation.

    Article 15

    Multi-level marketing enterprises shall stipulate in contract that the following is breaches of the participant, and shall prescribe methods for handling such breaches in order to prevent such breaches:

    1. promoting or selling goods or services, or recruiting participants to the multi-level marketing marketing organization, by deceptive or misleading means;
    2. raising funds from other persons in the name of the multi-level marketing enterprise or through its organization;
    3. engaging in sales by means that run counter to public order or good morals;
    4. affecting consumers’ rights and interests by improper direct sales calls;
    5. engaging in sales that violate the Criminal Code or other laws or regulations governing industry and commerce.

    Multi-level marketing enterprises shall enforce the handling methods referred in the preceding paragraph faithfully.

    Article 16

    Multi-level marketing enterprises may not recruit incapacitated persons to be participants.

    A multi-level marketing enterprise recruiting a person with limited capacity to be a participant shall first obtain the written consent from the legal representative of such a person and also attach the said written consent to the contract.

    The written consent referred to in the preceding paragraph may not be an electronic document.

    Article 17

    A multi-level marketing enterprise shall prepare the balance sheet and income statement for its multi-level marketing operations in the previous accounting year before the end of May each year and keep them in its main office.

    When the capital of a multi-level marketing enterprise reaches the amount specified in Article 20.2 of Company Act or the total multi-level marketing business volume in the previous accounting year exceeds the amount announced by competent authority, the multi-level marketing enterprise shall require auditing and certification by a certified public accountant for its financial statements.

    Participants may request to inspect the aforesaid financial statements of the multi-level marketing enterprise to which they belong and the multi-level marketing enterprise may not refuse such requests without justifications.

    Article 18

    Multi-level marketing enterprises shall have participants engaged in promoting and selling goods or service in reasonable market price as their major income, instead of earning mainly by introducing new participants.

    Article 19

    A multi-level marketing enterprise may not engage in any of the following activities:

    1. requiring a participant to pay any fee obviously incommensurate with the cost in the name of training, seminars,social activities, meetings, promotion or other like activities;
    2. requiring a participant to pay any security deposit, breach penalty, or other fee, which is obviously unreasonable;
    3. requiring a participant to purchase goods in a quantity that would obviously be impossible for an average person to sell out in a short period, unless it is agreed that the price shall be paid only after the goods is re-sold;
    4. giving specific persons preferential treatment in a manner contrary to the multi-level marketing organization or plan and therefore damaging other participants’ rights and interests;
    5. unduly request a participant to buy or grant a participant permission in two or more multi-level marketing organizations;
    6. requiring a participant to undertake obviously unfair obligations.

    Participants shall not engage in the activities referred in subparagraph 1 through, 3, 5 and 6 against the persons he or she introduce to participate.

    CHAPTER FOUR

    RESCISSION AND TERMINATION OF CONTRACTS

    Article 20

    Any participant may rescind or terminate the participation contract by giving the multi-level enterprise notice in writings within thirty days after entering into such contract.

    Within a period of thirty days after rescission or termination of the contract takes effect, the multi-level marketing enterprise shall accept the application from the participant for returning of goods, collect or accept goods returned by the participant, and return to the participant all the payment for goods made upon purchase and any other fees paid to the multi-level enterprise.

    In returning the payments made by the participant according to the preceding paragraph, the multi-level marketing enterprise may deduct upon the time of returning of the goods the value decreased due to the damage or loss attributable to the participant, and any bonus or remuneration already paid to the participant for purchase of such goods.

    If the returned goods is collected by the enterprise, the enterprise may deduct the shipping costs required for such collection.

    Article 21

    After the lapse of the period as referred to in the first paragraph of the preceding article, the participant at any time may still terminate the contract by writing and withdraw from the multi-level marketing plans or organizations,and request to return the goods , provided that when six months lapse since the date that the Products are deliverable, the participant may not request to return the goods.

    Within thirty days from the termination of the contract in accordance with the preceding paragraph, the multi-level marketing enterprise shall buy back all goods possessed by the participant at ninety percent (90%) of the original purchase price.

    The multi-level marketing enterprise may deducted the bonuses or remuneration paid to the participant for the purchase as well as the amount of the decreased value of the goods.

    If the returned goods is collected by the enterprise, the enterprise may deduct the shipping costs required for such collection.

    Article 22

    When the participant exercises the right to rescind or terminate the contract in accordance with the two preceding articles, the multi-level marketing enterprise may not claim damages or levy penalties against the participant for such rescission or termination.

    When the sold goods is supplied by third parties, and the participants exercise the right to rescind or terminate, the multi-level marketing enterprise shall handle the returning of goods and repurchase according to the preceding two articles, and shall pay the damages or penalties third party suppliers charge the participants.

    Article 23

    Multi-level marketing enterprises shall not improperly hinder a participant from returning goods according to provisions of this Act.

    Multi-level marketing enterprises shall not unjustifiably withhold commissions, bonuses, or other economic benefit payable to a participant after rescission or termination of the contract.

    Article 24

    The regulations relevant to the goods in this Chapter shall apply mutatis mutandis to services.

    CHAPTER FIVE

    PROCEDURE OF BUSINESS INSPECTIONS AND SANCTIONS

    Article 25

    A multi-level marketing enterprise shall record the organization development, sales of goods or services, payment of bonuses, and handling of goods returning within the territory of the Republic of China on a monthly basis and keep such records in its primary place of business for inspection by the competent authority. The materials in the preceding paragraph shall be kept for five years; the same shall apply in the case of an enterprise that ceases multi-level marketing practice.

    Article 26

    The competent authority may at any time dispatch personnel to inspect, or order an enterprise to fill forms and provide materials about the operation and development within specific deadline in the methods and format required by competent authority, and the enterprise shall not evade, impede, or refuse.

    Article 27

    The competent authority may investigate and handle, upon complaints or ex officio, any violation of the provisions of the Act.

    Article 28

    In conducting investigations under the Act, the competent authority may proceed in accordance with the following procedures:

    1. to notify the parties and any related third party to appear to make statements;
    2. to notify the parties and any related third party to submit books and records, documents, and any other necessary materials or exhibits, and
    3. to dispatch personnel for any necessary on-site inspection of the office, place of business, orother locations of the parties or any related third party.

    Things that may serve as evidence and is found during inspections referred above may be seized by competent authority, and the scope and duration of seizure shall be limited to an extent necessary for examination, inspection, verification or other purposes in connection with the preservation of evidence.

    The person who is under investigation conducted according to paragraph 1 may not evade, impede, or refuse without justifications.

    An investigator carrying out its duties under this Act shall present the documents supporting its duties, and the person to be investigated may refuse the investigation where the investigator fails to present such documents.

    CHAPTER SIX

    PUNISHMENT

    Article 29

    If any person violates the provisions of Article 18, the violator shall be punished by imprisonment for not more than seven years and at the same time may be fined not more than one hundred million

    New Taiwan Dollars. Shall any representative, agent, employee or other staff of a juristic person be punished for the violation of Article 18 in conducting business, not only the violator shall be punished in accordance with the preceding paragraph, the juristic person shall also be fined as prescribed in the preceding paragraph.

    Article 30

    Where any other laws provide for more severe punishment than those prescribed in the preceding article, the provisions of such other laws shall apply.

    Article 31

    The competent authority may order the multi-levels sale enterprise violating the provisions of Article 18 to dissolve, suspense or terminate business operation not longer than six months.

    Article 32

    If any person violates the provisions of Articles 6.1, 20.2, 21.2, 22, or 23, the competent authority may orderthe violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 100,000 or more and not more than New Taiwan Dollar 5,000,000, and after the lapse of such period, shall such enterprise fail to cease therefrom, rectify such conduct, or take any necessary corrective action, the competent authority may again order the violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 200,000 or more and not more than New Taiwan Dollar 10,000,000 each time until the violator ceases therefrom, rectifies such conduct, or takes necessary corrective action. If the situation is serious, the competent authority .may order the violator to dissolve, suspense or terminate business operation not longer than six months.

    The provisions of preceding paragraph shall apply to the violation of Article 20.2 when applied mutatis mutandis according to Article 24, the violation of Articles 21.2, 22, or 23.

    When the protection institution violates the regulations relevant to business operation methods and inspection prescribed in Article 38.5, the competent authority may impose a sanction according to paragraph 1 of this Article.

    Article 33

    If any person violates the provisions of Article 16, the competent authority may order the violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 100,000 or more and not more than New Taiwan Dollar 2,000,000, and after the lapse of such period, shall such enterprise fail to cease therefrom, rectify such conduct, or take any necessary corrective action, the competent authority may again order the violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 200,000 or more and not more than 4,000,000 each time until the violator ceases therefrom, rectifies such conduct, or takes necessary corrective action.

    Article 34

    If any person violates Articles 7.1, 9-12, 13.1, 14, 15,17, 19, 25.1, or 26, the competent authority may order the violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 50,000 or more and not more than New Taiwan Dollar 1,000,000, and after the lapse of such period, shall such enterprise fail to cease therefrom, rectify such conduct, or take any necessary corrective action, the competent authority may again order the violators to cease therefrom, rectify its conduct, or take necessary corrective action within the time prescribed in the order, and fine New Taiwan Dollar 100,000 or more and not more than New Taiwan Dollar 2,000,000 each time until the violator ceases therefrom, rectifies such conduct, or takes necessary corrective action.

    Article 35

    When the competent authority conducts investigation according to Article 28, if the party under investigation violates Article 28.3, the competent authority may fine New Taiwan Dollar 50,000 or more and not more than New Taiwan Dollar 500,000. If after notice again, the party under investigation evade, impede, or refuse without justifications, the competent authority may continue to issue notice for investigation, and fine New Taiwan Dollar 100,000 or more and not more than New Taiwan Dollar 1,000,000 each time until the party accepts investigation, appears to respond, or renders relevant materials like books and records, documents, or exhibits.

    CHAPTER SEVEN

    SUPPLEMENTARY PROVISIONS

    Article 36

    For the enterprises not meeting the definition of multi-levels sale enterprise prescribed in Article 8 of the Fair Trade Act, but actually conducted multi-levels sale business prior to the implementation of this Act shall apply for record by the competent authority according to Article 6 within three months after this Act takes effect. Any enterprises that fail to apply shall be subject to punishment under Article 6.1.

    The multi-levels sale enterprises as referred in preceding paragraph shall enter into written contract with the participants having participated prior to the implementation of this Act according to Article 13.1 within six months after this Act takes effect. Any enterprises that fail to enter into written contract shall be subject to punishment under Article 13.1.

    Participants participating multi-levels sale enterprises prior to the implementation of this Act may rescind or terminate contract according to Articles 20, 22, and 24 since the day this Act takes effect through 30 days expires after the contract referred in preceding paragraph is entered. Even after such period, participants may still terminate contract according to Articles21, 22, and 24.

    For the participants terminating contracts after this Act takes effect, the period prescribed in the exception clause of Article 21.1 shall start from the day this Act takes effect.

    Article 37

    If any multi-levels sale enterprises have applied for record prior to the implementation of this Act, they still shall revise the filing documents according to Article 6.1, and provide competent authority within two months after this Act takes effect supplemental amendments. If any multi-levels sale enterprises do not provide supplemental amendments, the competent authority will make decision as the enterprises in violation Article 7.1.

    If any multi-levels sale enterprises have applied for record prior to the implementation of this Act, they still shall revise the written contract entered into with participants, notify participants the revision content in written, and make announcements in business places. If any multi-levels sale enterprises do not notify participants the revision content in written, the competent authority will make decision as the enterprises in violation Article 13.1.

    After receiving the notification referred in preceding paragraph, if participants do not object within specific period, it will be deemed as they accept the revision.

    Article 38

    The competent authority shall designate the multi-levels sale enterprises having applied for record to donate certain property in order to establish a protection institution in charge of protecting the rights and interests of multi-levels sale enterprises having applied for record, and participants, and dispute resolution. The donation amount may be deducted from the protection fund and annual fee as prescribed in Paragraph 2.

    The protection institution may collect protection fund and annual fee from the multi-levels sale enterprises having applied for record. The collection methods and specific amount shall be determined by the competent authority.

    If the multi-levels sale enterprises having applied for record fail to pay according the preceding two paragraphs, it will be deemed as in violation of Article 32.1, and sanctioned accordingly.

    The enterprises may request the protection offered by the protection institution only after paying fund and annual fee according to the rules issued by the competent authority.

    The organizations, duties, fee appropriation, operation procedures, and its monitoring and management shall be determined by the competent authority.

    Article 39

    After this Act takes effect, the provisions in the Fair Trade Act relevant to multi-levels sale shall not apply.

    Article 40

    The enforcement rules of this Act shall be made and promulgated by the competent authority.

    Article 41

    This Act shall take effect upon promulgation.