Report 76 Business Practices Committee5. Notice of the section 8(1)(b) investigation |
The following appeared as Notice 1545 in Government Gazette No 18390 of 31 October 1997.
"in terms of the provisions of section 8(4) of the Harmful Business Practices Act, 1988 (Act No 71 of 1988), notice is hereby given that the Business Practices Committee intends undertaking an investigation in terms of section 8(l)(b) of the said Act into money revolving schemes as defined in the schedule. Any person may within a period of 30 days from the date of this notice make written representations regarding the above-mentioned investigation to: The Secretary, Business Practices Committee, Private Bag X84, PRETORIA, 0001.
Schedule
In this notice, unless the context indicates otherwise, a "money revolving scheme" means a scheme-
| a) | whereby participants are required to contribute valuable consideration towards the scheme, part of which contribution is used to reward both the promoters of the scheme and/or participants who preceded new participants and whereby promoters and/or participants are entitled to receive rewards out of contributions made by successive participants; and/or |
| b) | whereby the rewards of promoters and/or participants are directly correlated to the numbers of new participants canvassed directly or indirectly by the existing promoters and/or participants; and/or |
| c) | in which a majority of participants will not recoup their contributions, irrespective of: |
| i) | the stage on the life cycle of the scheme; and/or |
| ii) | at what stage the scheme comes to an end; and/or |
| iii) | at what stage the participants joined the scheme". |
Notice of the proposed investigation was also brought to the attention of the Office for Serious Economic Offences, the SABC, the South African Reserve Bank, the South African Police Services, the Direct Selling Association and the Financial Services Board.