PART SEVEN　LEGAL LIABILITY

　　Article 38　If a relevant authority and its working personnel that implement regulation on direct selling enterprises， direct sellers and their direct selling activities approve an application that does not meet the conditions stipulated herein， or fail to perform their regulatory duties in accordance with the provisions hereof， administrative penalty shall be imposed on the person in charge that is directly responsible and other directly responsible persons. If the case constitutes a criminal offence， criminal liability shall be pursued in accordance with the law. The approval granted to the application that does not meet the conditions stipulated herein shall be revoked by the relevant authority that has granted such approval. (来源：老牌的英语学习网站 http://www.EnglishCN.com)

　　Article 39　If anyone， in violation of Articles 9 and 10 hereof， engages in direct selling activities without approval， the administration for industry and commerce shall order rectification， confiscate the direct selling products and the illegal sales income， and impose a fine of not less than Rmb 50，000 and not more than Rmb 300，000. If the case is serious， a fine of not less than Rmb 300，000 and not more than Rmb 500，000 shall be imposed， and the business shall be banned in accordance with the law. If the case constitutes a criminal offence， criminal liability shall be pursued in accordance with the law.

　　Article 40　If an applicant obtains the licence set under Articles 9 and 10 hereof by deception or bribery， the administration for industry and commerce shall confiscate the direct selling products and the illegal sales income， and impose a fine of not less than Rmb 50，000 and not more than Rmb 300，000， and the licence shall be revoked by the State Council department in charge of commerce and the applicant may not submit an application again. If the case is serious， a fine of not less than Rmb 300，000 and not more than Rmb 500，000 shall be imposed， and the business shall be banned in accordance with the law. If the case constitutes a criminal offence， criminal liability shall be pursued in accordance with the law.

　　Article 41　If a direct selling enterprise violates Article 11 hereof， the administration for industry and commerce shall order rectification and impose a fine of not less than Rmb 30，000 and not more than Rmb 300，000. If it no longer meets the licensing conditions for direct selling business， its direct selling business licence shall be revoked by the State Council department in charge of commerce.

　　Article 42　If a direct selling enterprise， in violation of the provisions hereof， engages in direct selling business activities beyond the scope of direct selling products， the administration for industry and commerce shall order rectification， confiscate the direct selling products and the illegal sales income， and impose a fine of not less than Rmb 50，000 and not more than Rmb 300，000. If the case is serious， a fine of not less than Rmb 300，000 and not more than Rmb 500，000 shall be imposed， and the business licence of the branch of the direct selling enterprise that has illegal business conduct shall be revoked by the administration for industry and commerce， or the direct selling business licence of the direct selling enterprise shall be revoked by the State Council department in charge of commerce.

　　Article 43　If a direct selling enterprise and its direct sellers， in violation of the provisions hereof， have fraudulent and misleading publicity and marketing conduct， the administration for industry and commerce shall impose， on the direct selling enterprise， a fine of not less than Rmb 30，000 and not more than Rmb 100，000. If the case is serious， a fine of not less than Rmb 100，000 and not more than Rmb 300，000 shall be imposed， and the business licence of the branch of the direct selling enterprise that has illegal business conduct shall be revoked by the administration for industry and commerce， or the direct selling business licence of the direct selling enterprise shall be revoked by the State Council department in charge of commerce. The administration for industry and commerce shall impose， on the direct seller， a fine of not more than Rmb 50，000. If the case is serious， the direct selling enterprise shall be ordered to revoke his qualification as a direct seller.

　　Article 44　If a direct selling enterprise and its branches recruit direct sellers in violation of the provisions hereof， the administration for industry and commerce shall order rectification and impose a fine of not less than Rmb 30，000 and not more than Rmb 100，000. If the case is serious， a fine of not less than Rmb 100，000 and not more than Rmb 300，000 shall be imposed， and the business licence of the branch of the direct selling enterprise that has illegal business conduct shall be revoked by the administration for industry and commerce， or the direct selling business licence of the direct selling enterprise shall be revoked by the State Council department in charge of commerce.

　　Article 45　If anyone， in violation of the provisions hereof， engages in direct selling activities without obtaining a direct seller certificate， the administration for industry and commerce shall order rectification and confiscate the direct selling products and the illegal sales income， and may impose a fine of not more than Rmb 20，000. If the case is serious， a fine of not less than Rmb 20，000 and not more than Rmb 200，000 shall be imposed.

　　Article 46　If a direct selling enterprise conducts the business training of direct sellers in violation of the provisions hereof， the administration for industry and commerce shall order rectification， confiscate the illegal income and impose a fine of not less than Rmb 30，000 and not more than Rmb 100，000. If the case is serious， a fine of not less than Rmb 100，000 and not more than Rmb 300，000 shall be imposed， and the business licence of the branch of the direct selling enterprise that has illegal business conduct shall be revoked by the administration for industry and commerce， or the direct selling business licence of the direct selling enterprise shall be revoked by the State Council department in charge of commerce. The administration for industry and commerce shall impose a fine of not more than Rmb 50，000 on the instructor. If the instructor is a direct seller trainer， the direct selling enterprise shall be ordered to revoke his qualification as a direct seller trainer.

　　If any work unit or individual other than a direct selling enterprise organizes business training of direct sellers， the administration for industry and commerce shall order rectification， confiscate the illegal income and impose a fine of not less than Rmb 20，000 and not more than Rmb 200，000.

　　Article 47　If a direct seller violates Article 22 hereof， the administration for industry and commerce shall confiscate the illegal sales income and may impose a fine of not more than Rmb 50，000. If the case is serious， the direct selling enterprise shall be ordered to revoke his qualification as a direct seller， and a fine of not less than Rmb 10，000 and not more than Rmb 100，000 shall be imposed on the direct selling enterprise.

　　Article 48　If a direct selling enterprise violates Article 23 hereof， the matter shall be handled in accordance with the relevant provisions of the Pricing Law.

　　Article 49　If a direct selling enterprise violates Articles 24 and 25 hereof， the administration for industry and commerce shall order rectification and impose a fine of not less than Rmb 50，000 and not more than Rmb 300，000. If the case is serious， a fine of not less than Rmb 300，000 and not more than Rmb 500，000 shall be imposed， and the business licence of the branch of the direct selling enterprise that has illegal business conduct shall be revoked by the administration for industry and commerce， or the direct selling business licence of the direct selling enterprise is revoked by the State Council department in charge of commerce.

　　Article 50　If a direct selling enterprise fails to carry out information filing and disclosure in accordance with the relevant provisions， the administration for industry and commerce shall order rectification within a stipulated time limit and impose a fine of not more than Rmb 100，000. If the case is serious， a fine of not less than Rmb 100，000 and not more than Rmb 300，000 shall be imposed. If the enterprise refuses to carry out rectification， its direct selling business licence shall be revoked by the State Council department in charge of commerce.

　　Article 51　If a direct selling enterprise violates the relevant provisions of Part Five hereof， the administration for industry and commerce shall order rectification within a stipulated time limit and impose a fine of not more than Rmb 100，000. If the enterprise refuses to do so， a fine of not less than Rmb 100，000 and not more than Rmb 300，000 shall be imposed， and its direct selling business licence shall be revoked by the State Council department in charge of commerce.

　　Article 52　If any conduct in violation of these Regulations also violates the Prohibition of Pyramid Selling Regulations， it shall be handled in accordance with the relevant provisions of the Prohibition of Pyramid Selling Regulations.

　　PART EIGHT　SUPPLEMENTARY PROVISIONS

　　Article 53　If a direct selling enterprise intends to establish a social organization such as an association of direct selling enterprises， such organization shall be subject to the approval of the State Council department in charge of commerce and shall apply for registration on the strength of the approval document in accordance with the law.

　　Article 54　Investment in and establishment of direct selling enterprises and engagement in direct selling activities in China by investors from the Hong Kong Special Administrative Region， the Macao Special Administrative Region and the Taiwan region shall be handled with reference to the provisions on foreign investors hereof.

　　Article 55　These Regulations shall be implemented as of 1 December 2005.