How does social e-commerce operate in compliance?
All social e-commerce operators are e-commerce operators and are bound by the E-commerce Law.
Article 89 of Chapter 7 of the Electronic Commerce Law puts forward new requirements for social electronic commerce, a subdivision of the electronic commerce industry. In order to lead the legal development of social e-commerce industry, this guide carefully combs the legal provisions and condenses them into seven points to help social e-commerce operate in compliance and stay away from minefields.
1. Social e-commerce needs to be registered as a market entity, except in special circumstances.
The E-commerce Law requires social e-commerce operators to register market entities according to the standards and requirements for offline entity registration, except for some special circumstances that do not need to be registered (see the following laws for details), such as sporadic small transactions. However, due to the different standards of local industrial and commercial bureaus for sporadic small amounts, it is recommended that social e-commerce operators take the initiative to consult the local industrial and commercial bureaus about the scope of the quota registered by market entities.
Article 10 of E-commerce Law: E-commerce operators shall register market entities according to law. However, unless individuals sell their own agricultural and sideline products and household handicraft products, individuals do not need to obtain permission according to law, nor do they need to register according to laws and administrative regulations.
2. All social e-commerce companies must pay taxes and issue invoices according to law.
The e-commerce law requires social e-commerce operators to go through the registration procedures of market entities and clarify the identity and qualifications of taxpayers, thus regulating social e-commerce to pay taxes according to law. Note: Social e-commerce operators who meet the conditions of unregistered market entities should also register tax and truthfully declare their taxes.
Although there have been relevant laws and regulations that explicitly require operators to provide invoices to consumers, this e-commerce law clearly stipulates this in legal form. It is the seller's obligation to issue invoices, and it is illegal to refuse to issue invoices.
Article 11 of E-commerce Law: E-commerce operators shall fulfill their tax obligations and enjoy preferential tax treatment according to law. An e-commerce operator who does not need to register as a market entity according to the provisions of the preceding article shall, after the first tax payment obligation occurs, go through the tax registration in accordance with the provisions of laws and administrative regulations on tax collection management and truthfully declare and pay taxes.
Article 14 of E-commerce Law: When selling goods or providing services, e-commerce operators shall issue purchase vouchers or service documents such as paper invoices or electronic invoices according to law. Electronic invoices and paper invoices have the same legal effect.
3. Specific industries need business licenses to establish a level playing field online and offline.
Consistent with the requirements of offline entities, social e-commerce operators in some specific industries need to obtain business licenses according to law. To operate catering and food, you need to go to the Health Bureau to apply for a food circulation business license; Trading drugs requires a drug business license and a medical device business license, and selling health care drugs requires a food hygiene business license; To operate publications, you need to apply for a publication business license at the window of the Press and Publication Bureau ... It is worth noting that e-cigarettes belong to tobacco products, and their operation should comply with the relevant provisions of the Tobacco Monopoly Law, and you should apply for a tobacco monopoly license at the Tobacco Monopoly Bureau. Selling without permission will violate the criminal law.
Article 12 of the E-commerce Law: If an e-commerce operator needs to obtain the relevant administrative license in accordance with the law to engage in business activities, it shall obtain the administrative license in accordance with the law.
4. Actively "light up" the homepage and update the publicity information in time.
Social e-commerce operators need to continuously publicize business licenses, business licenses and other related information in a prominent position on the home page. If they want to terminate their social e-commerce business behavior on their own, they should continue to publicize it in a prominent position on the home page 30 days in advance to realize an easily identifiable, traceable and accountable safe trading model.
Article 15 of the E-commerce Law: E-commerce operators shall continuously publicize business license information, administrative licensing information related to their business, information that does not need to be registered as a market subject according to the provisions of Article 10 of this Law, or link and mark the above information in a prominent position on their home pages. If the information specified in the preceding paragraph changes, e-commerce operators shall update public information in a timely manner.
Article 16 of the E-commerce Law: If an e-commerce operator voluntarily terminates engaging in e-commerce, it shall continuously publicize relevant information in a prominent position on the front page 30 days in advance.
5. It is forbidden to fabricate transactions and evaluations.
The "Electronic Commerce Law" clearly stipulates that it is illegal to brush and evaluate, and it is forbidden to delete bad reviews to avoid unfair competition.
Article 17 of the E-commerce Law: E-commerce operators shall disclose the information of goods or services in a comprehensive, true, accurate and timely manner to protect consumers' right to know and choose. E-commerce operators shall not conduct false or misleading commercial propaganda, deceive or mislead consumers by fabricating transactions or user evaluation.
6. Advertisements should be clearly marked and their contents should be standardized.
Social e-commerce advertisements should be identifiable and clearly marked as "advertisements" so that consumers can identify them as advertisements. Social e-commerce advertising should comply with the provisions of the advertising law, such as:
Terms such as "national level", "superlative level" and "best" shall not be used.
Health food advertising: no efficacy, safety assertion, no disease prevention and treatment function, no spokesperson.
Investment advertisement: there should be a risk warning, and it is not allowed to express or imply that the capital preservation is risk-free, and it is not allowed to use the name or image of academic institutions, industry associations, professionals and beneficiaries to recommend or prove.
Fictitious, forged or unverifiable scientific research achievements, statistical data, survey results, abstracts, quotations and other information shall not be used as proof materials.
Article 18 of the Electronic Commerce Law: When sending advertisements to consumers, e-commerce operators shall abide by the relevant provisions of the Advertising Law of People's Republic of China (PRC).
7. Be the guardian of user privacy, and specify the cancellation method of user information.
Social e-commerce operators have the obligation to protect the information security of users. The specific provisions follow the network security law, that is, when collecting users' personal information, enterprises must be clear about the purpose, method and scope of collecting and using information, and must obtain the consent of users. Social e-commerce operators shall not disclose, tamper with or destroy the personal information they collect, and shall have the obligation of confidentiality and security. In addition, individuals also have the right to ask social e-commerce operators to correct or delete their personal information.
Article 23 of the Electronic Commerce Law: When collecting and using users' personal information, e-commerce operators shall abide by the provisions of laws and administrative regulations on the protection of personal information.
Article 24 of E-commerce Law: E-commerce operators shall clearly indicate the methods and procedures for inquiring, correcting, deleting and canceling user information, and shall not set unreasonable conditions for inquiring, correcting, deleting and canceling user information.
When an e-commerce operator receives an application for inquiring, correcting or deleting user information, it shall provide the inquiry, correction or deletion of user information in time after verifying its identity. If the user cancels, the e-commerce operator shall immediately delete the user information; If it is preserved in accordance with the provisions of laws and administrative regulations or agreed by both parties, such provisions shall prevail.
How can social e-commerce avoid the risk of communication?
"MLM" is the focus of national supervision and crackdown, and it is also the term that social e-commerce is most afraid to get involved in. Social e-commerce is an innovation of business model, not a variant of pyramid scheme. How to draw a clear line with the involved biography, strictly observe the red line and not cross the line? According to the MLM Prohibition Ordinance and other laws and regulations, here are five practical suggestions.
Core: "for the purpose of commodity sales"
1. Clarify the three elements involved in communication: "entrance fee", "attraction" and "team reward"
There are three main criteria for judging pyramid schemes. Simply put, it is "entrance fee", "attraction" and "team reward".
Entry fee: only after paying the money can you get the "qualification" for accrued remuneration and development of offline.
Pull the head: pull people to join, become offline, form a hierarchy in a certain order, and reward according to the direct or indirect number of people;
Team salary: online salary is calculated according to the sales performance directly or indirectly developed offline, or according to the number of people directly or indirectly developed.
Practical suggestions for social e-commerce:
① There is no entry fee and membership fee. You can become a dealer with 0 fee, and there is no threshold. All consumers can buy goods.
(2) people are not rewarded for joining, but are paid according to the actual sales performance of goods.
According to these three factors, these words are high-risk words involved in social e-commerce: head count, membership fee, hierarchy, online and offline, and virtual currency. Please be careful.
Article 7 of the MLM Prohibition Ordinance: The following acts are pyramid schemes:
(1) The organizer or operator, through the development of personnel, requires the developed personnel to develop other personnel to join, and calculates and pays remuneration (including material rewards and other economic benefits, the same below) to the developed personnel based on the number of personnel directly or indirectly developed, so as to seek illegal benefits;
(2) The organizer or business operator, through the development personnel, requires the developed personnel to pay the fees or pay the fees in disguised form by subscribing for commodities, etc. , so as to obtain the qualification to join or develop other personnel to join and seek illegal interests;
(3) The organizer or business operator requires the developed personnel to develop other personnel to join, thus forming an online relationship, and calculating and paying online rewards according to the sales performance of offline personnel to seek illegal benefits.
2. Sell real goods, and the price of the goods conforms to the market rules.
"Cheating property" is one of the conviction conditions of pyramid selling in criminal law. In order to avoid the suspicion of defrauding property, social e-commerce should sell real goods.
Practical suggestions for social e-commerce:
The goods sold can be actually consumed by consumers and have use value.
(2) Commodity prices conform to the market rules and the market prices of similar products, and there is no deviation, so as to avoid low prices and high prices.
③ Don't fabricate goods, especially don't use "virtual currency" as a gimmick to promote products.
(4) Don't exaggerate the profit prospects and return on investment, and clearly suggest that investment is risky.
Opinions on Several Issues Concerning the Application of Laws in Handling Criminal Cases of Organizing and Leading MLM Activities: Organizers and leaders of MLM activities fabricate and distort national policies, fabricate and exaggerate business, investment, service projects and profit prospects, conceal the true source of remuneration and kickbacks or adopt other fraudulent means, and commit the acts specified in Article 224-1 of the Criminal Law, and illegally profit from the expenses paid by people participating in MLM activities or the expenses for purchasing goods and services, which shall be deemed as fraudulent property. Whether the personnel involved in pyramid schemes think that they have been cheated does not affect the identification of fraudulent property.
3. The level is controlled within the third level.
In the current practice of social e-commerce, graded rebates often occur, but it should be noted that the grading should be controlled within three levels (including three levels). If it exceeds the third level, it may be involved.
Practical suggestions for social e-commerce:
The rebate level of social distribution should be within level 3, and you can't get the rebate above level 3.
Opinions on several issues concerning the application of laws in handling criminal cases of organizing and leading MLM activities: If the number of people participating in MLM activities in an MLM organization is more than 30 and the level is above the third level, the organizers and leaders shall be investigated for criminal responsibility.
The calculation of the number and level of people within the MLM organization, and the calculation of the number and level of organizers and leaders who directly or indirectly participate in MLM activities, including the organizers, leaders themselves and their levels.
4. Take the actual sales performance as the basis of team compensation.
"Team Payment" MLM can be divided into two categories: one is operational, that is, selling actual goods or services, and taking the performance of offline sales of goods or services as the basis for online payment or rebate; The second type is fraud, which is based on "pulling people's heads or charging entry fees". This kind of pyramid selling often has no actual goods, or goods have no actual circulation, and the income comes entirely from the constantly developing subordinates.
Although the above two types of pyramid schemes are suspected of violating the law, the current criminal law only punishes the second type of pyramid schemes that have no substantive business activities, that is, fraudulent pyramid schemes.
Social e-commerce business activities should not aim at "attracting people" and "earning membership fees", but should point to the sales of actual products and take the actual sales performance as the basis of team remuneration.
Practical suggestions for social e-commerce:
① Stay away from the "head-pulling" team compensation model.
(2) For the purpose of selling goods, rather than earning membership fees, brands, dealers and distributors all make profits by selling products.
③ When formulating the upgrade conditions of dealers, it is best not to have the conditions of "number of employees and subordinates" and take "actual sales performance of goods" as the main upgrade condition.
④ Don't use "multi-level rebate of head+subordinate performance" to calculate the remuneration of team leaders and partners. Instead, we can reward the distributors according to the training guidance, community management, consulting services and activity planning provided by the team leaders, establish an assessment mechanism for the above services, and encourage the team leaders to better serve the members of the social e-commerce ecosystem.
Opinions on several issues concerning the application of laws in handling criminal cases of organizing and leading MLM activities: The organizers or leaders of MLM activities, through the development of personnel, require the developed personnel of MLM activities to develop other personnel to join, form an online-offline relationship, calculate and pay online rewards based on offline sales performance, and obtain illegal benefits, which belongs to the "team compensation" MLM activities.
Simple "team payment" pyramid selling activities aimed at selling goods and based on sales performance are not treated as crimes. MLM activities in the form of "team remuneration", but in essence based on the number of developers or rebates, shall be convicted and punished for organizing and leading MLM activities in accordance with the provisions of Article 224-1 of the Criminal Law.
5. Pay attention to the delivery problem to ensure that the goods reach the final consumers.
In judging whether it involves communication, the actual sales performance of goods is produced for the purpose of commodity sales, which can largely avoid communication. If a commodity does not reach the final consumer, it cannot be said that it has "produced actual sales".
Social e-commerce should pay attention to the delivery problem, especially when the goods are piled up in the hands of agents (channels), which seems to produce a lot of shipments and performance, but in essence the goods are not really circulating, which is a very dangerous situation.
Social e-commerce collects money but doesn't deliver it, merchants deliver it but consumers don't pick it up, goods are piled up in warehouses without actual circulation, and it is not for the purpose of commodity trading, which will be considered as pyramid schemes.
Practical suggestions for social e-commerce:
(1) On the issue of delivery, the one-to-one delivery system can ensure the actual sales volume and avoid the backlog of goods in the channel because it is directly sent by the manufacturer to the consumers.
(2) properly keep the documents and materials (such as express waybill) that can prove that the actual commodity transaction occurred and the commodity reached the hands of consumers.
(3) If the consumer refuses to take delivery of the goods temporarily, he shall store the goods in a warehouse under the name of a company other than himself, charge the consumer a storage fee, and keep the transaction documents and the basis for the movement of the goods.
(4) Goods can be continuously repurchased by end consumers, which is also an important evidence that social e-commerce sells real goods that conform to the logic of market economy.
⑤ Clarify the exchange system to protect consumers' rights and interests.
How do social e-commerce pay taxes in compliance?
The "Electronic Commerce Law" clearly stipulates that social e-commerce should pay taxes according to law (regardless of whether market participants need to register). How should social e-commerce achieve fiscal and tax compliance? This guide brings you the best solution and teaches you to complete the evolution of finance and taxation in three steps.
Step 1: Establish an appropriate financial organization structure.
The first step of social e-commerce fiscal and tax compliance is to establish a financial organizational structure that is suitable for the form and scale of the enterprise.
Step 2: Calculate the tax cost.
Entrepreneurs, managers and practitioners of social e-commerce need to deeply understand the applicable taxes, tax rates, collection methods, tax calculation methods and tax preferences of the enterprises they operate in order to evaluate the significant impact of tax policies on commodity pricing, cost calculation and model design.
The main taxes and tax rates applicable to different forms of enterprises are as follows:
Step 3: Tax Planning
On the basis of paying taxes according to law, enterprises must make full use of relevant tax laws and regulations, preferential policies for unified taxation and relevant preferential policies of local governments to reduce the tax burden of enterprises as much as possible.
Examples of preferential tax policies:
Big waves wash sand and sink gold, and the winner is king. "E-commerce Law" not only brings new compliance pressure, but also brings a healthier, more standardized and fairer e-commerce regulatory environment. I sincerely wish every reader of this article is the ultimate winner in the second half of social e-commerce.