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Legal Opinion

To
Mr.Harish Bajaj,
Chairman
UnfoldU Global Marketing Pvt. Ltd.
Plot No. F-384
Phase 8B Industrial Area,
Mohali , Punjab 160055
          Dated: October 28,2020
          By email

Sub: Opinion regarding the compliances undertaken by UnfoldU Global Marketing Pvt. Ltd (hereinafter referred to as “UnfoldU”) in the light of applicable laws in India.

Dear Sir,

We have categorized the legal opinion in the following heads:

  • A. BACKGROUND
  • B. APPLICABLE LAWS AND RELEVANT PROVISIONS
  • C. BUSINESS OPERATIONS OFUNFOLDU
  • D. CONCLUSIONS
A. BACKGROUND

UnfoldU is engaged in the business of providing online education services through courses and programs designed for students up to class XII as well as students aiming for competitive exams through its website-www.unfoldu.com and/ or mobile application – UnfoldU Mobile Learning App (hereinafter jointly referred to as the “Portal”). UnfoldU renders its online educational services through the support of its business associates engaged with them under the direct selling model. In view of the above, you seek our opinion regarding the compliances undertaken by UnfoldU by offering its online educational services through direct selling model, in the light of the applicable laws in India

B. APPLICABLE LAWS AND RELEVANTPROVISIONS

In India, the relevant provisions instrumental in regulating the sale transactions taking place via direct selling model have been provided here under:

Model Framework for Guidelines on Direct Selling issued by the Department of Consumer Affairs regulating the business operations being carried out through Direct Selling and Multi-Level Marketing

Guidelines for regulating the business of ‘Direct Selling’ and Multi-Level Marketing issued by Government of Maharashtra (via Notification No. CGC. 2016/CR-150/CP-2.) to strengthen the existing regulatory mechanism on Direct Selling and Multi-Level Marketing (MLM), in the State of Maharashtra

C. ANALYSIS OF BUSINESS OPERATIONS OF UNFOLDU

UnfoldU renders its online educational services through direct selling model by engaging the services of its business associates (hereinafter referred to as “Independent Educational Counselor(s)”). The analysis of the business activities of UnfoldU under the light of applicable laws are stated as under:

Under Model Framework for Guidelines on Direct Selling issued by the Department of Consumer Affairs

I. Conditions for the setting up of Direct Selling business (covered under clause 2 of the above statedguidelines)

Criteria Status UnfoldU’s compliance
Entity to be registered under the laws of India Unfold U Global Marketing Pvt. Ltd.
Provide a mandatory orientation session We understand that UnfoldU has provided the same
Provide accurate and complete information to prospective and existing direct sellers concerning the reasonable amount of remuneration opportunity Included in agreement with Independent Educational Counselor(s)
Pay all dues and make withholdings from direct sellers in a commercially reasonable manner We understand that UnfoldU has provided the same )
Notify and provide a full refund or buy-back guarantee to every direct seller on reasonable commercial terms which can be exercised within a period of 30 days, Included in Refund Policy
Notify and provide to every direct seller a cooling-off period which entitles such direct seller to return any goods /services purchased by the direct seller during the cooling-off period
promoter or key management personnel should not have been convicted of any criminal offence punishable with imprisonment in last 5 years We understand that UnfoldU has provided the same
office with identified jurisdiction to enable the consumers and direct seller to acquaint themselves with price of products, return or replacement of products and efficient delivery of goods and services, and post-sale redressal of grievances;
II. Conditions for conduct of Direct Selling Business (covered under clause 3 of the above stated guidelines
Criteria Status UnfoldU’s compliance
Entity should be owner of IP Unfold U Global Marketing Pvt. Ltd. is the owner of the IP used for advertisement and marketing purpose.
Issue proper identity document(s) to its Direct Sellers We understand that UnfoldU has provided the same
maintain proper records either manual or electronic of their business dealings
maintain proper records either manual or electronic of their business dealings, etc. Website should have space for registering consumer complaints and should ensure that grievances are addressed within 45days of making such complaints
provide to all direct sellers their periodic account / information concerning, as applicable, sales, purchases, details of earnings, commissions,bonus
monitor the value of the purchases of all its Direct Sellers/Distributors on a monthly basis
Must not:
Use misleading, deceptive or unfair recruiting practices,
Make any factual representation to a prospective direct seller which cannot be fulfilled
Make any false representation
Engage in, or cause or permit, any conduct that is misleading or likely to mislead
Use, or cause or permit to be used, fraud, coercion, harassment, or unconscionable or unlawful means
Require its direct sellers to provide any benefit
Provide any benefit to any person for the introduction or recruitment of one or more persons as direct sellers;
Require the direct sellers to pay any money by way of minimum monthly subscription or renewal charges
III.Conditions for Direct Selling contract between Direct Seller/Distributor and Direct Selling Entity (covered under clause 4 and 6 of the above stated guidelines
Criteria Status UnfoldU’s compliance
Agreement with direct sellers made in writing, describing the material terms of participation incorporating the following:
not compelling or inducing the direct seller to purchase goods or services in an amount that exceeds an amount that can be expected to be sold to consumers within a reasonable period of time;
allowing or providing the direct seller a reasonable cooling-off period including cancellation and refund;
the termination of contract, with reasonable notice,
allowing or providing for a buy-back or repurchase policy for currently marketable goods or services sold to the direct seller
Relationship between Direct Selling Entity and Direct Seller (clause 6 of above referred guidelines)
Unfold U Global Marketing Pvt. Ltd. has agreement with Independent Educational Counselor(s)
IV. Conduct for the Protection of Consumer (covered under clause 7 of the above stated guidelines
Criteria Status UnfoldU’s compliance
Protection of all private information provided by a consumer We understand that UnfoldU provides the same
Compliance to Consumer Protection Act 1986
All complaints received over phone, email, website, post and walk-in should have a complaint number for tracing and tracking the complaint and record time taken for redressal
Constitution of a grievance redressal committee having consist of at least three officers and should address complaints and inform complainants of any action taken
Provide following information to the consumer upon purchase:  the name of the purchaser and seller;  the delivery date of goods or services;  procedures for returning the goods;  warranty of the goods and exchange / replacement of goods in case of defect.
V. Prohibition of Pyramid Scheme & Money Circulation Scheme(covered under clause 8 of the above stated guidelines
Criteria Status UnfoldU’s compliance
No person or entity shall promote a Pyramid Scheme, or enroll any person to such scheme or participate in such arrangement in any manner whatsoever in the garb of doing Direct Selling business.  No person or entity will participate in Money Circulation Scheme in the garb of Direct Selling of Business Opportunities. We understand that UnfoldU provides the same
V. Submission of undertaking to the Department of Consumer Affairs (covered under clause 9 of the above stated guidelines
Criteria Status UnfoldU’s compliance
Any direct selling entity conducting direct selling activities shall submit an undertaking to the Department of Consumer Affairs, stating that it is in compliance with these guidelines and shall also provide such details of its incorporation and other business details as may be notified from time to time UnfoldU has submitted the same from time to time
Guidelines for regulating the business of ‘Direct Selling’ and Multi-Level Marketing issued by Government of Maharashtra The aforesaid guidelines are in accordance to the provisions of Model Framework for Guidelines on Direct Selling issued by the Department of Consumer Affairs and additionally require the Direct Selling entities not to deal with selling of Websites, Web space, online Education, Online Training.

If UnfoldU offers offline services/ products in Maharashtra, in respect of which UnfoldU complies by the provisions of the Model Framework for Guidelines on Direct Selling issued by the Government of Maharashtra
D. CONCLUSION

In view of the above, please note that UnfoldU is compliant to the provisions the below mentioned applicable laws:

I. Model Framework for Guidelines on Direct Selling issued by the Department of Consumer Affairs in terms of the following requirements:

Conditions for the setting up of Direct Selling business
Conditions for conduct of Direct Selling Business
Conditions for Direct Selling contract between Direct Seller/Distributor and Direct Selling Entity
Conduct for the Protection of Consumer
Prohibition of Pyramid Scheme & Money Circulation Scheme
Submission of undertaking to the Department of Consumer Affairs

II. Guidelines for regulating the business of ‘Direct Selling’ and Multi-Level Marketing issued by Government of Maharashtra by not providing its online educational services in Maharashtra.

III. In respect of the offline services/ products offered by UnfoldU in the State of Maharashtra, it abides by the provisions of the Model Framework for Guidelines on Direct Selling issued by the Department of Consumer Affairs.

Hope the same addresses your concer


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