UPDATE ON DECREE NO. 137/2026/ND-CP ON THE REGULATION OF MULTI-LEVEL MARKETING ACTIVITIES
On 7 April 2026, the Government of Vietnam issued Decree No. 137/2026/ND-CP on the regulation of multi-level marketing activities (“Decree 137”).
Decree 137 will take effect from 1 July 2026 and replaces Decree No. 40/2018/ND-CP, as amended and supplemented by Decree No. 18/2023/ND-CP (“Decree 40”). The issuance of Decree 137 also results in the termination of the effectiveness of Article 25 of Decree No. 55/2024/ND-CP detailing the Law on Protection of Consumer Rights, as well as Article 48 and Appendix XIV of Decree No. 146/2025/ND-CP on decentralization of authority in the industry and trade sector.
Removal of Minimum Charter Capital Requirement (Statutory Capital)
Decree 137 abolishes the minimum statutory capital requirement of VND 10 billion previously imposed on multi-level marketing enterprises under Decree 40.
However, pursuant to Article 50 of Decree 137, enterprises are required to maintain a deposit equivalent to 5% of their charter capital and not less than VND 20 billion. This provision effectively introduces an indirect minimum charter capital threshold of VND 400 billion for enterprises engaging in multi-level marketing activities.
Retention of Experience Requirements for Foreign Investors
Decree 137 maintains the requirement that foreign investors, acting as general partners, members, shareholders, or owners, must have prior experience in multi-level marketing as a condition for obtaining a multi-level marketing registration certificate, similar to the requirements under Decree 40.
However, Decree 137 does not impose such requirements on foreign investors acquiring shares or capital contributions after the enterprise has been granted the multi-level marketing registration certificate.
Furthermore, Decree 137 does not require amendments to the registration certificate, nor does it provide for refusal to extend such certificate, in cases where foreign investors subsequently become shareholders, members, or owners of the enterprise.
This approach is similarly applied to the requirement that members, shareholders, owners, legal representatives, or managers must not have previously held equivalent positions in multi-level marketing enterprises whose registration certificates have been revoked.
Transitional Provisions under Decree 137
Decree 137 provides for a 12-month transitional period in respect of:
(i) compliance with conditions for multi-level marketing activities; and
(ii) procedures for approval of multi-level marketing training programs by provincial-level People’s Committees.
In addition, enterprises that have been granted a multi-level marketing registration certificate under Decree 40 are allowed to maintain a deposit equivalent to 5% of their charter capital but not less than VND 10 billion, without being required to comply with the new minimum deposit threshold of VND 20 billion under Article 50 of Decree 137.
However, the withdrawal and use of such deposit must comply with the provisions of Article 50 of Decree 137.
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