Codigo de Etica 4Life

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Code of Ethics


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direct selling association | code of ethics

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A. Code o ConduCt

1. dcpiv r uaw Csr

r Rcriig Pracics

a. No member company o the Asso-

ciation or independent sales

person or a member companyshall engage in any deceptive,

alse, unethical or unlawul

consumer or recruiting practice.

Member companies shall

ensure that no statements,

promises or testimonials are

made that are likely to mislead

consumers or prospectiveindependent salespeople.

b. Member companies and their

independent salespeople must

comply with all requirements

o law. While this Code does

not restate all legal obligations,compliance with all pertinent

laws by member companies and

their independent salespeople is

a condition o acceptance by and

continuing membership in DSA.

1. Tis secion does no bring proselyizing

or salesorce raiding dispues under he

Codes jurisdicion, unless such dispues

involve allegaions o decepive, unehical or

unlawul recruiing pracices or behaviors

aimed a poenial salespeople. In hose

cases, he secion applies. As used in his

secion, unehical means violaive o he

U.S. DSA Code o Ehics

Te DSA Code Adminisraor has he

auhoriy o make a deerminaion o

wha is a decepive, unlawul or unehical

consumer or recruiing pracice under he

Code using prevailing legal sandards as a

guide. Compliance wih any paricular law,

regulaion or DSA Code o Ehics provision

is no a deense o such a deerminaion by

he DSA Code Adminisraor ha a pracice

is decepive, unlawul or unehical. For

example, in a sale o a consumer, compli-ance wih he Federal rade Commission

Cooling-O Rule does no bar he DSA

Code Adminisraor om making a deer-

minaion ha a paricular sales pracice is

decepive, unlawul or unehical and ha a

reund or compensaion is required.

Code of Ethics

Explanaory provisions in ialics.

PReAmble

The Direct Selling Association, recognizing that companies engaged in direct

selling assume certain responsibilities toward customers arising out o the

personal-contact method o distribution o their products and services,

hereby sets orth the basic air and ethical principles and practices to which

member companies o the Association will continue to adhere in the conduct

o their business.


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code of ethics | direct selling association

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c. Member companies shall conduct

their activities towards other

members in compliance with this

Code and all pertinent laws.

d. Inormation provided by member

companies and their independent

salespeople to prospective or

current independent salespeople

concerning the opportunity and

related rights and obligations

shall be accurate and complete.

Member companies and their

independent salespeople shall not

make any actual representation

to prospective independent sales-

people that cannot be veried or

make any promise that cannot be

ullled. Member companies andtheir independent salespeople

shall not present any selling

opportunity to any prospective

independent salesperson in a

alse, deceptive or misleading

manner.

e. Member companies and their

independent salespeople shall

not induce a person to purchase

products or services based

upon the representation that a

consumer can recover all or part

o the purchase price by reerring

prospective consumers, i suchreductions or recovery are viola-

tive o applicable reerral sales

laws.

. Member companies shall provide

to their independent salespeople


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either a written agreement to

be signed by both the member

company and the independent

salesperson, or a written state-ment containing the essential

details o the relationship between

the independent salesperson and

the member company. Member

companies shall inorm their inde-

pendent salespeople o their legal

obligations, including their respon-

sibility to handle any applicable

licenses, registrations and taxes.

g. Member companies shall provide

their independent salespeople with

periodic accounts including, as

applicable, sales, purchases, details

o earnings, commissions, bonuses,discounts, deliveries, cancellations

and other relevant data, in accor-

dance with the member companys

arrangement with the independent

salesperson. All monies due shall be

paid and any withholdings made in

a commercially reasonable manner.

h. Independent salespeople shall

respect any lack o commercial

experience o consumers. Indepen-

dent salespeople shall not abuse

the trust o individual consumers,

or exploit a consumers age, illness,

handicap, lack o understanding orunamiliarity with a language.

2. Prcs, Srvics a

Pria marias

a. The oer o products or services

or sale by member companies o

1.&2. Tese secions cover communicaions

abou your own company or anoher

company. For example, a disribuor

or company A makes misleading


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the Association shall be accurate

and truthul as to price, grade,

quality, make, value, perormance,

quantity, currency o model andavailability. A consumers order

or products and services shall be

ullled in a timely manner.

b. Member companies shall not

make misleading comparisons

o another companys direct

selling opportunity, products or

services. Any comparison must

be based on acts that can be

objectively substantiated. Member

companies shall not denigrate

any other member company,

business, product or service

directly or by implication in aalse or misleading manner and

shall not take unair advantage o

the goodwill attached to the trade

name and symbol o any company,

business, product or service.

c. Promotional literature, advertise-

ments and mailings shall not

contain product descriptions,

claims, photos or illustrations that

are alse, deceptive or misleading.

(Promotional literature shall

contain the name and address or

telephone number o the member

company and may include thetelephone number o the individual

independent salesperson).

d. Independent salespeople shall

oer consumers accurate

inormation regarding: price,

saemens abou company B and/or

is producs o consumers or prospecive

salespeople.


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credit terms; terms o payment;

a cooling-o period, including

return policies; terms o guarantee;

ater-sales service; and deliverydates. Independent salespeople

shall give understandable and

accurate answers to questions

rom consumers. To the extent

claims are made with respect

to products, independent

salespeople shall make only those

product claims authorized by the

member company.

3. trs Sa

a. A written order or receipt shall

be delivered to the consumer at

or prior to the time o the initial

sale. In the case o a sale madethrough the mail, telephone,

Internet, or other non ace-to-

ace means, a copy o the order

orm shall have been previously

provided, be included in the initial

order, or be provided in printable

or downloadable orm through

the Internet. The order orm

must set orth clearly, legibly and

unambiguously:

i. Terms and conditions o sale,

including the total amount the

consumer will be required to

pay, including all interest, service

charges and ees, and other costsand expenses as required by

ederal and state law;

ii. Identity o the member company

and the independent salesperson,

and contain the ull name,


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permanent address and telephone

number o the member company

or the independent salesperson,

and all material terms o the sale;and

iii. Terms o a guarantee or a

warranty, details and any limita-

tions o ater-sales service, the

name and address o the guar-

antor, the length o the guarantee,

and the remedial action availableto the consumer. Alternatively,

this inormation may be provided

with other accompanying litera-

ture provided with the product or

service.

b. Member companies and their

salespeople shall oer a written,clearly stated cooling o period

permitting the consumer to

withdraw rom a purchase order

within a minimum o three days

rom the date o the purchase

transaction and receive a ull

reund o the purchase price.

c. Member companies and their

independent salespeople oering

a right o return, whether or not

conditioned upon certain events,

shall provide it in writing.

4. Warrais a Garas

The terms o any warranty or

guarantee oered by the seller in

connection with the sale shall be

urnished to the buyer in a manner

that ully conorms to ederal and

state warranty and guarantee laws


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and regulations. The manuacturer,

distributor and/or seller shall ully

and promptly perorm in accordance

with the terms o all warranties andguarantees oered to consumers.

5. Iicai a Privacy

a. At the beginning o sales

presentations independent

salespeople shall truthully and

clearly identiy themselves, their

company, the nature o their

companys products or services,

and the reason or the solicitation.

Contact with the consumer

shall be made in a polite manner

and during reasonable hours.

A demonstration or sales

presentation shall stop upon theconsumers request.

b. Member companies and

independent salespeople shall

take appropriate steps to

saeguard the protection o all

private inormation provided by a

consumer, a prospective consumer,

or other independent salespeople.

6. Pyrai Scs

For the purpose o this Code, pyramid

or endless chain schemes shall be

considered consumer transactions

actionable under this Code. TheCode Administrator shall determine

whether such pyramid or endless

chain schemes constitute a viola-

tion o this Code in accordance with

applicable ederal, state and/or local

law or regulation.

6. Te deniion o an illegal pyramid is

based upon exising sandards o law as

reeced in In he mater o Amway, 93

FC 618 (1979) and he ani-pyramid

laws o Kenucky, Louisiana, Monana,Oklahoma, and exas. In accordance

wih hese laws, member companies shall

remunerae direc sellers primarily on

he basis o sales o producs, including

services, purchased by any person

or acual use or consumpion. Such


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7. Ivry Prcass

a. Any member company with a

marketing plan that involves

selling products directly or indi-

rectly to independent salespeople

shall clearly state, in its recruitingliterature, sales manual, or

contract with the independent

salespeople, that the company

will repurchase on reasonable

commercial terms currently

marketable inventory, in the

possession o that salespersonand purchased by that sales-

person or resale prior to the date

o termination o the salesper-

sons business relationship with

the company or its independent

salespeople. For purposes o this

Code, reasonable commercial

terms shall include the repur-chase o marketable inventory

within twelve (12) months

rom the salespersons date o

purchase at not less than 90

percent o the salespersons orig-

inal net cost less appropriate set

os and legal claims, i any. Forpurposes o this Code, products

shall not be considered currently

marketable i returned or

repurchase ater the products

commercially reasonable usable

or shel lie period has passed;

remuneraion may include compensaion

based on sales o individual direc sellers

or heir own acual use or consumpion.

7a. Te purpose o he buyback is o elimi-nae he poenial harm o invenory

loading; i.e., he pracice o loading

up salespeople wih invenory hey are

unable or unlikely o be able o sell oruse wihin a reasonable ime period.

Invenory loading has hisorically been

accomplished by giving sellers nan-

cial incenives or sales wihou regard

o ulimae sales o or use by acual

consumers. Te repurchase provisions

o he Code are mean o deer invenory

loading and o proec disribuors om

nancial harm which migh resul om

invenory loading.

Invenory is considered o include boh

angible and inangible produc; i.e., boh

goods and services. Curren marke-

abiliy o invenory shall be deermined

on he basis o he specic condiion o heproduc. Facors o be considered by he

Code Adminisraor when deermining

curren markeabiliy are condiion o

he goods and wheher or no he prod-

ucs have been used or opened.

Changes in markeplace demand,

produc ormulaion, or labeling areno sucien grounds or a claim by he

company ha a produc is no longer

markeable. Nor does he ingesible

naure o cerain producs limi per se he

curren markeabiliy o hose producs.

Governmen regulaion which may


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nor shall products be considered

currently marketable i the

company clearly discloses to

salespeople prior to purchasethat the products are seasonal,

discontinued or special promo-

tion products and are not subject

to the repurchase obligation.

b. Any member company with a

marketing plan which requires

independent salespeople to

purchase company-produced

promotional materials, sales aids

or kits shall clearly state, in its

recruiting literature, sales manual

or contract with the independent

arguably resric or limi he ulimae

resalabiliy o a produc does no limi is

curren markeabiliy or purposes o

he Code.Sae saues mandae ha cerain

buyback provisions required by law mus

be described in a direc sellers conrac.

While acknowledging ha he conrac

is probably he mos eecive place or

such inormaion, he DSA Code allows

or placemen o he provision in eiherrecruiing lieraure or conrac. Te

DSA Code is mean o emphasize ha

he disclosure mus be in wriing and

be clearly saed. Wherever disclosed,

he buyback requiremen shall be

consrued as a conracual obligaion o

he company.

A company shall no place any unreason-

able (e.g., procedural) impedimens in

he way o salespeople seeking o sell back

producs o he company.

Te buyback process should be as

ecien as possible and designed o acil-

iae buyback o producs. Te buybackprovisions apply o all erminaing

disribuors who oherwise qualiy or

such repurchase, including disribu-

ors who are no new o a paricular

company, or hose who have lef a

company o sell or anoher company.

7b. 1998 amendmens made i clear ha

sales aids, kis and promoional mae-

rials, while no invenory or necessarily

inended or resale, are subjec o he

repurchase requiremen i a company

requires heir purchase or i here is a

nancial incenive associaed wih heir

sale. I was recognized ha loading o


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will repurchase these items on

reasonable commercial terms.

Any member company with a

marketing plan which provides

its independent salespeople with

any nancial benet related to

the sales o company-produced


or kits shall clearly state, in its

recruiting literature, sales manual

or contract with the independent


will repurchase, on reasonable

commercial terms, currently

marketable company-produced


or kits.

A member company shall clearly

state in its recruiting literature,

sales manual or contract with the

independent salespeople i any

items not otherwise covered by

this Section are ineligible or repur-

chase by the company.

8. earigs Rprsais

No member company shall misrep-

resent the actual or potential sales

or earnings o its independent

salespeople. Any earnings or sales

representations that are made bymember companies shall be based

on documented acts.

hese iems can cause he same harm o

plan paricipans as loading o invenory.

Wih respec o he nal paragraph

o Secion 7b., disclosure o an iemseligibiliy or ineligibiliy or he buyback

is key. Provided ha repurchase is no

required by his Code provision, or

hose iems a company chooses no o

repurchase, he company should clearly

and conspicuously disclose o he buyer

ha he iems are no subjec o herepurchase requiremen. Under such

disclosure, a reusal o ake an iem

back will no consiue a violaion

providing he member is acing in good

aih and no atemping o evade he

repurchase requiremen.

8. Tere is ample legal preceden in he

orm o FC decisions o aord guidance

on he subjec o earnings represena-

ions. While no conrolling, hese

precedens should be used by he Code

Adminisraor in making deermina-ions as o he subsaniaion o company

earnings claims.

Te Codes simple prohibiion o

misrepresenaions was inended, in

par, o avoid unduly encumbering

sar-up companies ha have litle or


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9. Ivry laig

A member company shall not

require or encourage an independent

salesperson to purchase inventoryin an amount which unreasonably

exceeds that which can be expected

to be resold and/or consumed

within a reasonable period o time.

Member companies shall take

reasonable steps to ensure that

independent salespeople receiving

compensation or downline sales

volume are consuming, using or

reselling the products and services

they purchase in order to qualiy to

receive compensation.

10. Pay s

Neither member companies nor theirindependent salespeople shall ask

individuals to assume unreasonably

high entrance ees, training ees,

ranchise ees, ees or promotional

materials or other ees related

solely to the right to participate in

no acual earnings hisory wih heir

compensaion plan or esablished

companies ha are esing or launching

new compensaion plans. Te prohibi-ion approach is mean o require ha

companies in hese circumsances need

only ensure ha heir promoional

lieraure and public saemens clearly

indicae ha he compensaion plan is

new and ha any chars, illusraions

and saed examples o income under

he plan are poenial in naure and no

based upon he acual perormance o

any individual(s).

9. See, Code Explanaory 7a. regarding

invenory loading.

10. High enrance ees can be an elemen o

pyramid schemes, in which individualsare encouraged o expend large upon

coss, wihou receiving produc o like

value. Tese ees hen become he mecha-

nism driving he pyramid and placing

paricipans a risk o nancial harm.

Some sae laws have requiremens ha


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the direct selling business. Any ees

charged to become an independent

salesperson shall relate directly to

the value o materials, products orservices provided in return.

11. traiig a marias

a. Member companies shall provide

adequate training to enable

independent salespeople to

operate ethically.

b. Member companies shall prohibit

their independent salespeople

rom marketing or requiring

the purchase by others o any

materials that are inconsistent

with the member companys

policies and procedures.

c. Independent salespeople selling

member company-approved

promotional or training materials,

whether in hard copy or electronic

orm, shall:

ees be reurned similar o he repurchase

provisions delineaed in Code 7a. Te

Code eliminaes he harm o large ees

by prohibiing unreasonably high ees.Te Code Adminisraor is empowered

o deermine when a ee is unreason-

ably high. For example, i a reund is

oered or only a porion o an enrance

ee, o cover wha could be described

as invenory, and here is nohing else

given or received or he balance o he

enrance ee, such as a raining program,

ha porion o he enrance ee may be

deemed o be unreasonably high by he

Code Adminisraor. Tis Code secion

reinorces he provision in Code Par B.

Responsibiliies and Duies requiring

companies o address he Code viola-

ions o heir independen conracorsalesorce.


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i. Use only materials that comply

with the same standards used by

the member company,

ii. Not make the purchase o suchmaterials a requirement o other

independent salespeople,

iii. Provide such materials at not

more than the price at which

similar material is available

generally in the marketplace, and

iv. Oer a written return policy

that is the same as the return

policy o the member company

the independent salesperson

represents.

d. Member companies shall take

diligent, reasonable steps toensure that promotional or

training materials produced by

their independent salespeople

comply with the provisions o this

Code and are not alse, misleading

or deceptive.


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b. ReSPonSIbIlItIeS And dutIeS

1. Prp Ivsigai a n Ip Cracr ds

a. Member companies shall establish, publicize and implement complaint

handling procedures to ensure prompt resolution o all complaints.b. In the event any consumer shall complain that the salesperson or repre-

sentative oering or sale the products or services o a member company

has engaged in any improper course o conduct pertaining to the sales

presentation o its goods or services, the member company shall promptly

investigate the complaint and shall take such steps as it may nd appro-

priate and necessary under the circumstances to cause the redress o any

wrongs which its investigation discloses to have been committed.c. Member companies will be considered responsible or Code violations by

their solicitors and representatives where the Administrator nds, ater

considering all the acts, that a violation o the Code has occurred. For the

purposes o this Code, in the interest o ostering consumer protection,

companies shall voluntarily not raise the independent contractor status o

salespersons distributing their products or services under its trademark or

trade name as a deense against Code violation allegations and such action

shall not be construed to be a waiver o the companies right to raise suchdeense under any other circumstance.

d. The members subscribing to this Code recognize that its success will require

diligence in creating an awareness among their employees and/or the inde-

pendent wholesalers and retailers marketing the members products or

services o the members obligations under the Code. No subscribing party

shall in any way attempt to persuade, induce or coerce another party to

breach this Code, and the subscribers hereto agree that the inducing o thebreach o this Code is considered a violation o the Code.

e. Individual salespeople are not bound directly by this Code, but as a condi-

tion o participation in a member companys distribution system, shall be

required by the member company with whom they are aliated to adhere

to rules o conduct meeting the standards o this Code.

. This Code is not law but its obligations require a level o ethical behavior

rom member companies and independent salespeople that is consistent

with applicable legal requirements. Failure to comply with this Code doesnot create any civil law responsibility or liability. When a company leaves

the DSA membership, a company is no longer bound by this Code. However,

the provisions o this Code remain applicable to events or transactions that

occurred during the time a company was a member o DSA.


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2. Rqir Picai

a. All member companies are required to submit to DSA, along with its appli-

cation or membership or in the case o existing members along with their

next dues payment, a proposed program as to how the company plans onpublicizing DSAs Code o Ethics to its sales people and consumers. The plan

shall contain, at a minimum, one o the ollowing:

i. an inclusion on the member companys website o DSAs Code o Ethics

with a step-by-step explanation as to how to le a complaint; or

ii. a link rom the member companys website to DSAs Code o Ethics with

a clear, bold aced statement as to how to make the connection; or

iii. an inclusion o the member companys Code o Ethics, or its complainant

process, on its website, or with an explanation o how a complainant

may appeal to the DSA Code Administrator in the event the complainant

is not satised with the resolution under the company code, or the

companys complaint process, with a reerence to the website o DSAs

Code o Ethics.

b. All member companies, ater submission o their program, are required

to state annually, along with paying their dues, that the program remains

eective or indicate any change.

3. C Rspsiiiy ocr

Each member company and pending member company is required to desig-

nate a DSA Code Responsibility Ocer. The Code Responsibility Ocer is

responsible or acilitating compliance with the Code by their company and

responding to inquiries by the DSA Code Administrator. He or she will also

serve as the primary contact at the member company or communicating

the principles o the DSA Code o Ethics to their independent sales people,

company employees, customers and the general public.

4. exrarriria efc

Each member company shall comply with the World Federation o Direct

Selling Associations Code o Conduct with regard to direct selling activities

outside o the United States to the extent that the WFDSA Code is not incon-

sistent with U.S. law, unless those activities all under the jurisdiction o thecode o conduct o another countrys DSA to which the member company

also belongs.


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C. AdmInIStRAtIon

1. Irprai a exci

The Board o Directors o the Direct Selling Association shall appoint a

Code Administrator to serve or a xed term to be set by the Board prior to

appointment. The Board shall have the authority to discharge the Adminis-

trator or cause only. The Board shall provide sucient authority to enable

the Administrator to properly discharge the responsibilities entrusted to the

Administrator under this Code.

The Administrator will be responsible directly and solely to the Board. The

Board o Directors will establish all regulations necessary to administer the

provisions o this Code.

2. C Aiisrar

a. The Administrator shall be a person o recognized integrity, knowledgeable

in the industry, and o a stature that will command respect by the industry

and rom the public. He shall appoint a sta adequate and competent to

assist him in the discharge o his duties. During his term o oce, neither

the Administrator nor any member o his sta shall be an ocer, director,

employee, or substantial stockholder in any member or aliate o the

DSA. The Administrator shall disclose all holdings o stock in any member

company prior to appointment and shall also disclose any subsequent

purchases o such stock to the Board o Directors. The Administrator shall

also have the same rights o indemnication as the Directors and Ocers

have under the bylaws o the Direct Selling Association.

b. The Administrator shall establish, publish and implement transparent

complaint handling procedures to ensure prompt resolution o allcomplaints.

c.The Administrator, in accordance with the regulations established by the

Board o Directors as provided herein, shall hear and determine all charges

against members subscribing hereto, aording such members or persons

an opportunity to be heard ully. The Administrator shall have the power to

originate any proceedings, and shall at all times have the ull cooperation

o all members.

3. Prcr

a. The Administrator shall determine whether a violation o the Code has

occurred in accordance with the regulations promulgated hereunder. The

Administrator shall answer as promptly as possible all queries posed by

members relating to the Code and its application, and, when appropriate,

may suggest, or consideration by the Board o Directors, new regulations,


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denitions, or other implementations to make the Code more eective.

b. I, in the judgment o the Code Administrator, a complaint is beyond the

Administrators scope o expertise or resources, the Code Administrator

may decline to exercise jurisdiction in the matter and may, in his or herdiscretion, recommend to the complainant another orum in which the

complaint can be addressed.

c. The Administrator shall undertake through his oce to maintain and

improve all relations with better business bureaus and other organizations,

both private and public, with a view toward improving the industrys rela-

tions with the public and receiving inormation rom such organizations

relating to the industrys sales activities.

d. ReGulAtIonS oR enoRCement o dSA Code o ethICS

1. Rcip Cpai

Upon receipt o a complaint rom a bona de consumer or where the Admin-

istrator has reason to believe that a member has violated the Code o Ethics,

the Administrator shall orward a copy o the complaint, i any, to the accused

member together with a letter notiying the member that a preliminary

investigation o a specied possible violation pursuant to Section 3 is beingconducted and requesting the members cooperation in supplying necessary

inormation, documentation and explanatory comment. I a written complaint

is not the basis o the Administrators investigation, then the Administrator

shall provide written notice as to the basis o his reason to believe that a viola-

tion has occurred. Further, the Code Administrator shall honor any requests

or condential treatment o the identity o the complaining party made by

that party.2. Cprai wi C Aiisrar

In the event a member reuses to cooperate with the Administrator and

reuses to supply necessary inormation, documentation and explanatory

comment, the Administrator shall serve upon the member, by registered

mail, a notice aording the member an opportunity to appear beore the

Appeals Review Panel on a certain date to show cause why its membership

in the Direct Selling Association should not be terminated. In the event themember reuses to cooperate with the Administrator or to request a review

by the Appeals Review Panel, the DSA Board o Directors, or a designated part

thereo, may vote to terminate the membership o the member.


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3. Ira Ivsigai a dispsii Prcr

a.The Administrator shall conduct a preliminary investigation, making such

investigative contacts as are necessary to reach an inormed decision as

to the alleged Code violation. I the Administrator determines, ater theinormal investigation, that there is no need or urther action or that the

Code violation allegation lacks merit, urther investigation and administra-

tive action on the matter shall terminate and the complaining party shall

be so notied.

b. The Administrator may, at his discretion, remedy an alleged Code viola-

tion through inormal, oral and written communication with the accused

member company.

c.I the Administrator determines that the allegation has sucient merit, in

that the apparent violations are o such a nature, scope or requency so as

to require remedial action pursuant to Part E and that the best interests

o consumers, the association and the direct selling industry require reme-

dial action, he shall notiy the member o his decision, the reasoning and

acts which produced it, and the nature o the remedy he believes should be

eected. The Administrators notice shall oer the member an opportunity

to voluntarily consent to accept the suggested remedies without the neces-sity o a Section 4 hearing. I the member desires to dispose o the matter

in this inormal manner it will, within 20 days, advise the Administrator, in

writing, o its willingness to consent. The letter to the Administrator may

state that the members willingness to consent does not constitute an

admission or belie that the Code has been violated.

4. Appas Rviw Pa

An Appeals Review Panel consisting o ve representatives rom active

member companies shall be selected by the Executive Committee o DSAs

Board o Directors. Each member shall serve or a term o three years. The ve

members shall be selected in a manner that represents a cross-section o the

industry. When an appeal is made by a member company, the Chairman o the

DSA Board o Directors shall select three o the ve members o the Appeals

Review Panel to constitute a three-person panel to review the appeal, and

shall name one o them Chairman o that panel. When possible, no companyo the three shall sell a product that specically competes with the Appel-

lant, and every eort shall be made to avoid conficts in selecting the panel.

I or any reason, a member o the panel cannot ulll his or her duties or ll

out a term or any reason, the Chairman o the Board o DSA can replace that

person with a new appointment or the remainder o the unullled term with

the concurrence o the Executive Committee.


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5. Appas Rviw Prcr

a.I a member company objects to the imposition o a remedial action by the

Administrator, it shall have a right to request a review o the Administra-

tors decision by the Appeals Review Panel. A member company must makesuch a request in writing submitted to the Administrator within 14 days o

being notied o the remedial action by the Administrator. Within 10 days

o receiving such a request, the Administrator shall notiy the Chairman o

the Board o DSA who, at that time, shall select the three-person panel in

accordance with Section 4 above. That selection shall take place within 30

days o the members request or the review.

b. As soon as the panel has been selected, the Administrator shall inorm

the Appellant o the names o the panelists, including the name o the

chairman o the panel. Within 14 days o that notication, the Administrator

shall send a copy o the Complaint and all relevant documents, including

an explanation o the basis o the decision to impose remedial action, to

the panelists with copies to the Appellant. Upon receipt o such inorma-

tion, the Appellant shall have 14 days to le with the panel its reasons or

arguing that remedial action should not be imposed along with any addi-

tional documents that are relevant. Copies o that inormation should alsobe sent to the Administrator.

c. Once the inormation has been received by the panelists rom both the

Administrator and the member company, the panel will complete its

review within 30 days or as soon thereater as practicable. The panel shall

decide whether the Administrators decision to impose remedial action

was reasonable under all o the acts and circumstances involved and shall

either conrm the Administrators decision, overrule it or impose a lesser

sanction under Part E. The panel shall be ree to contact the Administrator

and the Appellant and any other persons who may be relevant witnesses to

the Complaint, ormally or inormally as deemed appropriate. A decision by

the panel shall be nal and shall be promptly communicated both to the

Administrator and the Appellant. The costs involved in the appeal such as

costs o photocopying, telephone, ax and mailing, shall be borne by the

Appellant.

6. Cs eics mr Cpais

a. Apprva y Aiisrar:

i. I a complaint is against a member company that has a code o ethics,

which has been registered with the DSA Code o Ethics Administrator,

and the Administrator has issued an opinion that the company code is

compatible with DSAs Code o Ethics, the Complainant must rst exhaust


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all remedies under the company code o ethics beore ling a complaint

with DSAs Code Administrator. I the Complainant has exhausted those

remedies and is o the opinion that the companys disposition o the

Complaint was unsatisactory the Complainant can appeal the compa-nys decision to the DSA Code Administrator. The Complainant must rst

notiy the company o the intent to appeal to DSA. The Complainant

must also orward all relevant documentation rom the company code

proceeding to DSAs Administrator.

ii. Ater receiving such an appeal, the Administrator shall coner with the

company to obtain any additional inormation concerning the matter

as well as an explanation or the companys decision. The Adminis-

trator shall decide whether the companys resolution o the complaint

was reasonable under all o the acts and circumstances involved. I the

Administrator decides in the negative, the Administrator shall work

with the company in an eort to resolve the matter satisactorily to all

parties. I the Administrator nds that the member company will not

cooperate in that eort, the Administrator can impose remedial action

in accordance with DSAs Code o Ethics. The Complainant shall bear all

costs o an appeal rom a decision under a company code, including suchcosts as photocopying, telephone, ax and mailing charges.

b. Araiv erc Prcss: In certain instances, a member

company may provide a process whereby complaints can be addressed

and which provide an equally acceptable vehicle or complaint resolution.

In such instancesprovided the process has been ormally reviewed and

approved by the DSA Code Administratorthe member companys process

may be substituted or, and the member company relieved o, adherence to

the provision o Section D. Regulations or Enorcement o the DSA Code

o Ethics. In order or a member companys enorcement process to be

approved as an alternative to Section D, the process must contain all the

ollowing elements:

i. The company has adopted an investigation and review process that

substantially mirrors that presented in Section D and contains at more

than one level the ormal review o complaints regarding its salesper-

sons or representatives;ii. The company has adopted an appeal process to the steps outlined in

Paragraph 1 above that includes review by a neutral and competent third

party, as approved by the DSA Code o Ethics Administrator;

iii.The company oers a satisaction guarantee or the equivalent on product

sales to consumers who are not salespersons or representatives o the

member company; and


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iv.The company advises its salespersons or representatives o the dispute

resolution process in a suciently transparent manner including notices

on its website and in appropriate literature.

c. I a member company meets the above requirements o paragraph b., DSAwill indicate on its website that the member companys Code o Ethics is

an approved alternative taking precedence over the DSAs Code o Ethics

Section D. Regulations or Enorcement o the DSA Code o Ethics.

d.Those companies that are on the Company Code Alternative list will be

exempt rom the required publication provisions o Section B.2 o the Code

and will not have to show on their websites or in separate literature that

complaints against the company should be led with the DSA Code o Ethics

Administrator. The DSA Code o Ethics website will indicate, however, that

all member companies are subject to all other provisions o the DSA Code

o Ethics. Further, i the DSA Code o Ethics Administrator nds that any

company on the Alternative list has ailed to comply with the requirements

or such a listing the Administrator may remove that company rom the

list.

e. PoWeRS o the AdmInIStRAtoR

1. Ris

I, pursuant to the hearing provided or in Part D Section 3, the Administrator

determines that the accused member has committed a Code o Ethics viola-

tion or violations, the Administrator is hereby empowered to impose the

ollowing remedies, either individually or concurrently, upon the accused

member:

a. Require complete restitution to the complainant o monies paid or

the accused members products, which were the subject o the Code

complaint;

b. Require the replacement or repair o any accused members product, the

sale o which was the source o the Code complaint;

c. Require the payment o a voluntary contribution to a special assessment

und which shall be used or purposes o publicizing and disseminating the

Code and related inormation. The contribution may range up to $1,000 perviolation o the Code.

d. Require the accused member to submit to the Administrator a written

commitment to abide by the DSA Code o Ethics in uture transactions and

to exercise due diligence to assure there will be no recurrence o the prac-

tice leading to the subject Code complaint.


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e. Require the cancellation o orders, return o products purchased, cancel-

lation or termination o the contractual relationship with the independent

salesperson or other remedies.

2. Cas Cs

I the Administrator determines that there has been compliance with all

imposed remedies in a particular case, he shall close the matter.

3. Rsa Cpy

I a member reuses to voluntarily comply with any remedy imposed by the

Administrator, and has not requested a review by the Appeals Review Panel,

the DSA Board o Directors, or designated part thereo, may conclude that themember should be suspended or terminated rom membership in the Asso-

ciation. In that event the Administrator shall notiy the member o such a

decision by registered mail and shall remind the member o its right to have

the Administrators original decision reviewed by the Appeals Review Panel in

accordance with Part D Section 5 (Appeals Review Procedure) o this Code.

4. Appa r Risa Ar Sspsi r triaiI the suspension or termination is not appealed, or i it is conrmed by the

Appeals Review Panel, a suspended member, ater at least ninety days, and

a terminated member, ater at least one year, may request the opportunity

to have its suspension or termination reviewed by the Appeals Review Panel,

which may in its discretion reinstate membership.

5. Rrra Sa r ra Agcy

In the event a member is suspended or terminated, and continues to reuse tocomply with any remedy imposed by the Administrator within 30 days ater

suspension or termination, the Administrator may then consult with indepen-

dent legal counsel to determine whether the acts that have been ascertained

amount to a violation o state or ederal law. I it is determined that such a

violation may have occurred, the Administrator shall so notiy the accused

member by certied or registered mail, return receipt requested, and i appro-

priate action has not been taken by the accused member, and communicatedto the Administrator ater 15 days ollowing such notice, the Administrator

may submit the relevant data concerning the complaint to the appropriate

ederal or local agency.


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. ReStRICtIonS

1. Crrig wi ors

At no time during an investigation or the hearing o charges against a member

shall the Administrator or member o the Appeals Review Panel coner withanyone at any time concerning any alleged violation o the Code, except as

provided herein and as may be necessary to conduct the investigation and hold

a hearing. Any inormation ascertained during an investigation or hearing shall

be treated as condential, except in cases where the accused member has

been determined to have violated ederal, state or local statutes. At no time

during the investigation or the hearing o charges shall the Administrator or a

member o the Appeals Review Panel coner with a competitor o the memberalleged to be in violation o the Code, except when it may be necessary to call

a competitor concerning the acts, in which case the competitor shall be used

only or the purpose o discussing the acts. At no time shall a competitor

participate in the Administrators or in the Appeals Review Panels disposition

o a complaint.

2. dcs

Upon request by the Administrator to any member, all documents directly

relating to an alleged violation shall be delivered to the Administrator. Any

such inormation obtained by the Administrator shall be held in condence

in accord with the terms o these regulations and the Code. Whenever the

Administrator, either by his own determination or pursuant to a decision by

the Appeals Review Panel, terminates an action which was begun under the

Code, a record o the member accused shall be wiped clean and all docu-

ments, memoranda or other written material shall either be destroyed or

returned, as may be deemed appropriate by the Administrator, except tothe extent necessary or deending a legal challenge to the Administrators

or Appeals Review Panels handling o a matter, or or submitting relevant

data concerning a complaint to a local, state or ederal agency. At no time

during proceedings under this Code regulation or under the Code shall the

Administrator or member o the Appeals Review Panel either unilaterally or

through the DSA issue a press release concerning allegations or ndings o a

violation o the Code unless specically authorized to do so by the Executive

Committee o DSAs Board o Directors.

3. Pig mrs dSA

Nothing in Part F shall prevent the Administrator rom notiying, at his discre-

tion, DSA sta members o any alleged violations o the Code that have come

to his attention and which may have a bearing on a DSA pending members

qualications or active membership.


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G. ReSIGnAtIon

Resignation rom the Association by an accused company prior to comple-

tion o any proceedings constituted under this Code shall not be grounds or

termination o said proceedings, and a determination as to the Code violationshall be rendered by the Administrator at his or her discretion, irrespective o

the accused companys continued membership in the Association or partici-

pation in the complaint resolution proceedings.

h. AmendmentS

This Code may be amended by vote o two thirds o the Board o Directors.

As AdoptedJune 15, 1970

As Amendedby Board o Directors through

June 5, 2010


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