BusinessWhy Is QNET Banned? 

Why Is QNET Banned? 


Why is QNET banned? It’s not! The truth is that QNET is a legitimate direct selling company that’s not banned anywhere in the world where direct selling is welcome. According to CEO Malou Caluza, it’s a very “transparent” company with nothing to hide.

However, some countries, including the Sultanate of Oman in the Middle East, do prohibit the sale of products through direct selling. In Oman, network marketing, which is a style of direct selling, is banned. Because QNET is a leader in establishing direct selling in new markets, it gets misidentified as a pyramid scheme or scam because authorities don’t understand the business model. 

Due to the lack of understanding and regulation in the direct selling industry, the company gets wrongfully identified as a fraudulent business in the global media. Perhaps you’ve seen misleading headlines stating that QNET is banned in India. However, that is not true. In fact, several high courts in India have cleared QNET of any misconduct. 

Judicial Systems Confirm Legitimacy

In January 2022, the High Court of Karnataka acknowledged the business legitimacy of the QNET franchisee in India, Vihaan Direct Selling (India) Pvt. Ltd. Additionally, the High Court of Karnataka’s ruling safeguards the franchisee from any intimidation while instructing Vihaan to cooperate with the investigating authorities. It reached this decision because of complaints lodged by individuals claiming the company enticed them to make monetary donations.

According to reports in The Hindu, the High Court of Karnataka will not allow the state government to take coercive measures against Vihaan Direct Selling (India) Pvt. Ltd., a sub-franchisee of the company, at this time. The High Court of Karnataka directed the government to hold off while examining the correctness of invoking the provisions of the Karnataka Protection of Interest of Depositors in Financial Establishments Act of 2004 (KPIDFE Act) against Vihaan Direct Selling. The ruling came after Vihaan explained that it’s not a financial establishment but is an e-commerce-based direct selling company. Due to that, the provisions of the KPIDFE Act cannot be used against Vihaan since it’s not dealing with any aspect of financial activities, including deposit collection.

In India, for the past nine years, Vihaan Direct Selling has been battling allegations that it’s a scam. However, since 2016, the Indian government has been moving toward recognizing and regulating the direct selling industry. That includes appointing the Ministry of Consumer Affairs as the nodal authority for direct selling in 2016 and issuing guidelines for direct selling companies to adhere to. In early 2022, direct selling regulations were included into the Consumer Protection Act amendments. 

In other legal news, after three years of QNET defending its business model in Mumbai, the Hyderabad High Court granted a stay on all legal proceedings against the company in the state in October 2016. And by early 2017, the High Court of Karnataka rescinded all criminal proceedings against the company in a cybercrime case. Also in 2017, the Supreme Court of India ordered a stay on all proceedings against the company and Vihaan Direct Selling (India) Pvt. Ltd. That order halted all first information requests against the company across India. 

Why Is QNET Banned? Direct Sales Is Not a Scam

QNET is one of Asia’s leading e-commerce-based direct selling companies, offering a variety of lifestyle and health and wellness products to help people live their best lives. Unfortunately, it’s been mistaken for a scam or pyramid scheme. However, it follows a grassroots business model energized by the power of e-commerce and has helped empower millions of entrepreneurs in India and around the world. QNET’s distributors are located in more than 100 countries globally. 

The direct sales company has a presence in more than 25 countries worldwide through subsidiaries, branch offices, and franchisees like India’s Vihaan Direct Selling, and agency representatives. It’s a member of the Direct Selling Association in multiple countries. It’s also a member of the Hong Kong Health and Food Association and the Health Supplements Industry Association of Singapore. 

Even though it’s been making its mark in the direct sales industry since 1998, it constantly defends itself from false scam allegations. “QNET has been around for more than two decades. How many scam companies manage to survive this long?” Caluza asks. Even so, “There’s a lot of misinformation about QNET out there,” she says.

Despite these setbacks and false accusations, the company continues to thrive. “It’s proven to be a recession-resistant industry. The direct sales industry has prospered through all the major economic crises the world has faced over the years. It’s always proven to be resilient and adaptable,” says Caluza. “For many people, direct selling offers a great platform to become micro-entrepreneurs and build a sales business promoting such products when they sign up as distributors of direct selling companies. Our distributors are present in many different regions around the world. That’s why we offer a diverse portfolio to suit different demographics,” Caluza explains. “We work with international vendors to design unique, high-quality, and advanced-technology products that are exclusively available on QNET.” 

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