Based on the Regulations on the Prohibition of Distribution:
Article 2, distribution, refers to the organizer or operator of the development of personnel, through the development of people to the development of the number of direct or indirect development of the number of people or sales performance as the basis for calculating and paying compensation, or require the development of the people in order to pay a certain amount of money as a condition of obtaining access to the qualification, etc. to obtain illegal benefits, disrupt the economic order, affect social stability. Behavior that affects social stability.
Article 7
The following acts belong to pyramid schemes:
(1) The organizer or operator, through the development of personnel, requires the personnel to be developed to develop other people to join, and calculates and pays remuneration (including material incentives and other economic benefits, hereinafter the same) to the developed people on the basis of the number of people developed directly or indirectly by rolling up the development of people to make illegal profits;
(2) The organizer or operator, through the development of personnel, requires the personnel being developed to pay fees or subscribe to commodities and other means of payment in disguise, to obtain the qualification of joining or developing other people to join, and profiting from illegal benefits;
(3) The organizer or operator, through the development of personnel, requires the personnel being developed to develop other people to join, forming an up and down line relationship, and (C) the organizer or operator through the development of people to develop other people to join, the formation of upline and downline relationship, and the following line of sales performance as the basis for calculating and paying the upper line of remuneration, profit-making illegal benefits.