sec_3_2__para

COMMISSION NOTICE – Guidance on the interpretation and application of Directive 2005/29/EC of the European Parliament and of the Council concerning unfair business-to-consumer commercial practices in the internal market · European Union

This practice has been banned to prevent traders from luring consumers into a scheme promising them compensation when in fact the consumer will actually be compensated primarily for bringing new members into the scheme, rather than from the sale or consumption of products. The pyramid structure of the scheme is generally devised in such a way that it will deliver benefits only to the organisers at the top, whereas recruited consumers usually do not stand any reasonable chance to recover what they have invested. The Court has clarified the conditions under which a system of trade promotion can be considered a ‘pyramid promotional scheme’ within the meaning of Point No 14 of Annex I. The Court noted that:

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Source: EUR-Lex (Cellar) · retrieved 2026-09-25 · Text as adopted (Official Journal); later amendments are not incorporated in this text.