Section 8 – Presentation of the Amway Sales & Marketing Plan

The Amway Sales and Marketing Plan sets out the system of Amway commissions, bonuses and awards. It also details Amway’s guidelines and procedures for presentation of the Plan to prospective IBOs. The guidelines have been formulated so as to ensure compliance with sometimes complicated State, Federal and Common Law requirements for fair and ethical marketing in Australia. This section summarises essential do’s and don’ts in that regard.

8.1 Must not give false impression: When inviting a prospect to hear a presentation of the Amway Sales and Marketing Plan, an IBO shall neither directly or indirectly:

8.1.1 Give the impression that the Amway Sales and Marketing Plan relates to an employment opportunity (in accordance with Rule 4.16);

8.1.2 Imply that the invitation is to a social event;

8.1.3 Disguise the invitation as a “market survey”;

8.1.4 Promote the event as a “tax seminar;” finance seminar, investments seminar or similar event;

8.1.5 Promote the Amway Business Opportunity as a business relationship with a person, company, or organisation other than Amway as stated in Rule 4.31.1(e) above;

8.1.6 Directly or indirectly indicate that such products are merely one line of products distributed through or as a part of a brokerage, consignment, or intermediary business operated by a person, company or organisation other than Amway;

8.1.7 Directly or indirectly indicate that the Amway Business Opportunity, IBO or products and services merchandised through Amway are part of any business other than the Amway Business Opportunity as defined in the Rules of Conduct and other official Amway literature;

8.1.8 Engage in any other direct or indirect misrepresentation of the Amway Business Opportunity and the IBO’s relationship to Amway and the nature of the Amway Business, or omit any information that a person receiving such an invitation or attending or otherwise participating in such a presentation or event could reasonably be expected to need in order to properly evaluate the Amway Business Opportunity, Amway Products; or

8.1.9 In any other way violate Rule 4.31 above.

8.2 First Business Contact With Prospects: It is a breach of the Rules of Conduct and Amway Business Policies for an IBO to mislead or fail to inform a Prospect the nature of the IBO activities and, therefore, at the first business contact with Prospects, an IBO must:

8.2.1 Introduce himself/herself by name;

8.2.2 Truthfully and honestly represent the Amway Business Opportunity, its products and/or service;

8.2.3 Make himself/herself known as an Amway IBO;

8.2.4 Appropriately identify Amway and the IBO’s relationship to Amway;

8.2.5 Indicate the purpose of contact, namely the sale of Amway Products and/or the introduction of the Prospect to the Amway Business Opportunity; and

8.2.6 Truthfully and honestly respond with full transparency and candour to any questions that the Prospect has concerning the Amway Business Opportunity, Amway Products, the IBO or Amway.

8.3 Sponsorship Ethics and Accurate Representation: In seeking participation of a prospect in the Amway Sales and Marketing Plan, or in any representation made about Amway, IBOs must comply with Rule 4.31 above as well as the following:

8.3.1 Must not say that a successful IB can be built in the form of a “wholesale buying club”, where the only products bought and sold are those transferred to other IBOs for their personal use. This includes representing Amway as being a warehouse or clearing house or principal distribution company;

8.3.2 Must not represent retailing as unimportant or unprofitable or relatively unimportant or unprofitable or state that there is no requirement for the retail sale or marketing of Amway Products or Amway distributed products or services by IBOs.

8.3.3 Must not represent of imply that an IBO can benefit solely or principally by sponsoring others to be IBOs, and/or by obtaining products or services for personal use at less than retail price;

8.3.4 Must not misrepresent or promote the enjoyment of tax benefits as a reason for becoming an IBO.

8.3.5 Must not claim that an IBO may achieve success or maintain a particular income level from the Amway Business wilientth little or no expenditure of effort or time.

8.3.6 Must not represent the past, present, future, anticipated, likely or possible profits or earnings of IBOs otherwise than by using either:

a) The hypothetical income amount and illustrations set out in current Amway produced literature, and provided that the amounts are stated to be only hypothetical; or

b) The amounts must be of actual Amway commissions and/or Bonuses/Rebates from the IBO’s personal experience, provided that the IBO discloses (with prior consent) the names of the IBOs who have earned the commission/bonuses/ rebates. In such a situation the IBO must point out that there is no guarantee that other IBOs will achieve similar results.

8.3.7 Must not state or in any way imply or represent that they or any other IBOs earn higher incomes from the Amway Business than they in fact do, whether by including incomes from his/her full time jobs or incomes from selling books, tapes, CDs, DVDs and seminar tickets to other IBOs, or otherwise;

8.3.8 Must not state or in any way imply or represent that they or any other IBOs are at a higher level of achievement under the Amway Sales and Marketing Plan than they in fact are;

8.3.9 Must not cite examples of success (e.g. travel, motor vehicles, homes, contributions to charitable causes) unless the IBO knows such benefits were in fact obtained as the result of earning commissions and bonuses/rebates from the sale of Amway Products and Amway-distributed products or services;

8.3.10 Must not misrepresent the relationship between Amway and any other company affiliate with Amway;

8.3.11 Must not represent that Amway-manufactured products constitute or comprise an insignificant or insubstantial or small proportion of all the products distributed by Amway;

8.3.12 Must not describe or represent Amway as being only one of many suppliers of goods and services to IBOs and customers;

8.3.13 Must not make any warranty, representation or guarantee on behalf of or in the name of Amway or in relation to Amway Products or Amway- distributed products or services other than those written guarantees; and

8.3.14 Must not engage in any conduct or make any statement or representation or use any trade name, association name, business name or company name (in each case, whether registered or not) or other description or do any other act, matter or thing which is likely to lead any other IBO, Customer or any other person into believing that Amway is other than the principal of the IBO or that the IBO is other than an independent contractor to retail Amway Products and Amway-distributed products or services and to solicit applications for appointment as IBOs contracted to Amway.

8.3.15 Must not use any broadcast communication methods including mass mailings, telemarketing, national or international advertising, radio, television, facsimile services, computer communication networks including the Internet, or any other means by which personal contact with a Prospect is not present. Advertising is allowed in a limited context as described in the Digital Communication Standards.

8.4 Truthful Explanation: Without limiting the generality or specificity of an IBO’s obligations under Rule 4 and 8.3 or elsewhere in these Rules, during any formal or informal presentation or explanation of the Amway Business Opportunity, an IBO:

8.4.1 Will truthfully and honestly present the business with full transparency and candour;

8.4.2 Will conduct the presentation in accordance with the requirements of the Amway Sales and Marketing Plan;

8.4.3 Will point out the features of the Amway Business Opportunity and the IBO contractor relationship;

8.4.4 Will as soon as practicable in the presentation, identify Amway as his/her principal and correctly describe the relationship between Amway and its IBOs as described in current Amway produced literature, Amway correspondence, instructions and directives;

8.4.5 Will state that income or bonuses/rebates will only be realised through continued sales of Amway Products and Amway-distributed products or services to consumers and by the maintenance of certain qualifications; and shall indemnify Amway from and against all actions, damages, claims, demands, prosecutions and the cost thereof (including Amway’s actual legal costs) which might be suffered by or made or sought against Amway in respect of or arising out of any failure or omission to do so, or other breach of this Rule.

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