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Problem with overseas multi-level marketing businesses

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(Inquiry)

I was invited by my school friend to join a business, which was, “I will receive a referral bonus if I act as an agent of this overseas Internet site when the person whom I have referred purchases something via the site.” I heard that my friend had earned a bonus of about 200,000 yen. I was told that it was a company which operated worldwide and since I trusted my friend, I signed the contract and paid about 300,000 yen with my credit card. Later, I became nervous as I heard that “business in Japan has become doubtful.” The terms and conditions on the site say, “No unconditional cancellation of a contract after 3 days,” but is it possible to exercise my cooling-off right?

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(Answer)

We have been asked about problems with overseas multi-level marketing businesses, which begin by recruiting through friends or via social media.

Some overseas businesses don’t agree to cancellations, insisting that “They don’t have anything to do with Japanese laws,” however, consumers who contracted overseas businesses in Japan might be able to claim their cooling-off right, etc.

Make sure you check the terms of the contract closely as well as the risks, etc. before signing, instead of blindly trusting claims of making easy money, even if it comes from a friend. It’s important that you don’t enter into a contract easily if you don’t understand it.

Please contact the Consumer Affairs Center nearest to you at an early timing when you are uncertain.