(a) Requirements applicable to multi-level marketing organizations prohibited by the former Door-to-Door Sales Act;

(b) The case holding that sales organizations managed and operated by the defendants do not constitute sales organizations referred to in paragraph (1)

A. In order to constitute a multi-level marketing organization prohibited under Article 18(3), (1), and (2) of the former Door-to-Door Sales, etc. Act (amended by Act No. 4896 of Jan. 5, 195), the organization must be an organization formed with a successive and phased structure between the other party and the other party on the basis of a sales contract between the door-to-door seller and the one who is recommended by the other party (the other party) and the other party, and between the other party or between the other party and the other party or between the other party, in a successive and phased manner; and (2) the organization must pay a certain amount of profit regardless of the sales of the goods directly made by the other party or the other party, or the education and guidance on the business activities, etc. of the other party or the other party; and (3) the organization must be recommended to make sales of the goods by linking the other party's sales of the goods recommended by the other party, regardless of its name and form.

B. The case holding that sales organizations managed and operated by the defendants do not constitute sales organizations referred to in paragraph (1)

Articles 18 and 26 of the former Door-to-Door Sales, etc. Act (amended by Act No. 4896 of Jan. 5, 1995)

Defendant 1 and three others

A co-inspector;

Attorney Kwon Woo (for the defendant)

Busan District Court Decision 93No3383 delivered on May 4, 1994

The appeal is dismissed.

As to the Grounds of Appeal

Article 18 (3), (1) and (2) of the Act on Door-to-Door Sales, Etc. In order to fall under the above multi-level marketing organization, the court below's determination that the above organization's sales activities are reasonable based on the sales contract between the visiting sales business operator and the other party's sales contract (hereinafter "the other party's sales contract") and that the person who becomes a member of the organization in consecutive and phased manner shall be an organization formed between the other party's sales contract and the other party's sales contract at the same time. The court below's determination that the above organization's sales activities and the other party's sales activities are prohibited by the above provision of the Act on Door-to-Door Sales, etc. And it is clear that the above provision's sales activities are prohibited by the education division's sales activities and the other party's sales contract's sales activities are prohibited, and that the above provision's sales activities are 6% of the company's sales revenue which the other party's sales activities and the other party's sales contract's sales activities are prohibited by the other party's sales.

Therefore, the appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices.

Justices Park Jong-chul (Presiding Justice)