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April 01, 2012

Cover Story

Direct Selling’s Billion Dollar Markets

by Marilynn Hood

Seldia—Promoting the Direct Selling Industry in Europe

Seldia—Promoting the Direct Selling Industry in Europe
The European Commission, in Brussels, Belgium, is one of the main institutions of the European Union.

SeldiaSeldia is now the name of the Federation of European Direct Selling Associations. Formerly known as FEDSA, this organization seeks to represent the direct selling industry in Europe. Its membership currently consists of 22 DSAs in the European Union States and 13 corporate members.

Direct selling companies must comply with the laws of each country in which they operate. Even with the European Union providing a framework for the many countries which are members, there are no uniform laws across Europe dealing with the direct selling industry. With Europe comprised of so many different countries, direct selling companies often find the various laws challenging.

With its office in Brussels, Belgium, Seldia is able to keep current with much of the legislation affecting Europe. Not only is Brussels the capital of Belgium, but it also serves as the capital of Europe and is an important political, financial and commercial hub. The European Union is headquartered there, and as Maurits Bruggink, the Executive Director of Seldia, notes, approximately 80 percent of all laws concerning the European Union are made in Brussels.

While laws and regulations are needed to protect consumers and ensure ethical operations, overregulation can suppress enterprise, particularly the entrepreneurship on which direct selling thrives. Of particular concern to Bruggink currently is the proposed legislation that would require distributors to be classified as employees of direct selling companies. “That, of course, would kill our sector completely,” he says. “In the European Union, we have 4.5 million direct sellers. If they would all have to be employees, it becomes unaffordable.”

Such legislative proposals can be a threat to the industry, but they also give occasion for Bruggink and other Seldia representatives to lobby for the direct selling industry in Europe. “We have the opportunity to educate governments and to gain recognition for our trade,” he says. And, he goes on to note, the country of France has formally recognized direct selling and given it legal status. This has come with an increased cost to direct sellers, who must now make social and health contributions, but it has served to promote the industry in France. It has increased consumer confidence in direct sellers, and the government can make claims concerning job creation. Hopefully, this recognition by France will open the door for similar legislation in other countries. 

Currently, the European countries with higher growth in the direct selling industry are mostly in Central and Eastern Europe—Turkey, Ukraine and Russia, among others. Not only are there fewer government regulations to deal with, Bruggink notes, but also the people are eager for the opportunities that direct selling has to offer. Poland, which served as host for the first Round Table on the Future of Direct Selling conference in 2011, and other Central European countries tend to be champions against overregulation of the industry, he says.

While the debt crisis in Europe has created much economic pain, direct selling continues to offer the people of Europe the opportunity to create their own work.