Legal Documents & Contracts
What is a Franchise Disclosure Document? Key Details Explained
Franchising is often seen as an easier way to start a business. But it still comes with serious legal and financial responsibility.
4 min read
Direct Selling Agreement
The agreement between a business and the agents who sell on its behalf. Under the Direct Selling Rules a written one is not optional: it is a condition of operating.
- Written against the Consumer Protection (Direct Selling) Rules, 2021
- Commission structure, territory and targets written in
- Returns, refunds and buy-back dealt with explicitly
+2 moreShow less
- Use of your brand and marketing material controlled
- Drafted by experienced lawyers for how your channel actually works
Get started today
Close the formA few details, then secure checkout. Your expert takes it from there.
- Your details stay confidential
- Secure online payments
- Queries answered in 24 business hours
- 10,000+ Businesses served
- 100% Satisfaction Guarantee policy
- 4.7/5 Ratings On Google
Prefer to talk to someone first?
What a direct selling agreement is
The contract between a business and an agent authorised to sell or distribute its products on its behalf.
A direct selling agreement is made between a business and an agent authorised to sell or distribute the products of that business on its behalf. It describes in writing the terms of commission, the returns policy, the use of intellectual property and the other terms between the business and the agent.
It can be used by any business that appoints direct selling agents. Two copies are executed, with the agent and the business each retaining one original for their records, and it is printed on non-judicial stamp paper at the rate the state sets.
Since 2021 it is also a regulatory requirement. The Consumer Protection (Direct Selling) Rules oblige a direct selling entity to enter into a written contract with every direct seller, alongside a set of other obligations: a registered office in India, a grievance officer, a nodal officer and specified disclosures on its website.
- Between
- Business and agent
- Governed by
- Direct Selling Rules, 2021
- Under the Consumer Protection Act
- Must be
- In writing
- With every direct seller
- Copies
- Two
- One original each
- Stamp paper
- At the state rate
- Non-judicial
- Entity must have
- A grievance officer
- And a nodal officer
- Pyramid schemes
- Prohibited
Why businesses have us draft it
- Drafted against the 2021 Rules, not against a pre-2021 template
- A consultation about how your channel and your commissions actually work
- Returns, buy-back and termination drafted deliberately rather than omitted
- A master agreement you use with every agent
- Thousands of businesses served across every state in India
What the drafting covers
- A consultation call about your products, your channel and your commission model
- An agreement drafted from scratch by an experienced lawyer
- Commission, territory, targets and the term of the appointment
- Returns, refunds and buy-back obligations written in
- Control over the use of your brand and marketing material
- Revisions after you have read the draft
The agreement is one of the obligations the Direct Selling Rules impose. The others, the officers, the website disclosures and the registered office, are worth working through on the same call.
What the Rules expect of the business
A written contract with every seller
Not a policy document, not a login to a portal. An agreement, signed, with each direct seller.
A grievance officer and a nodal officer
Both appointed, both named, and reachable. Consumer complaints and coordination with law enforcement respectively.
Disclosures on your website
Specified information about the entity, its products and the terms of the direct selling arrangement, published where a consumer can find it.
No pyramid or money circulation scheme
Promoting either is prohibited outright. Where the compensation rewards recruitment rather than sales, the model is the problem and no drafting fixes it.
Customer reviews
What our clients say
- Rated 5 out of 5
Had a great experience with LegalWiz for my trademark registration. The service was smooth, and the after sales support was excellent. Although the filing took around 3 days, the team stayed connected throughout, provided clear updates, and there were no communication issues. Overall, a very professional and reliable experience.
Vishvam PGJune 2026 - Rated 5 out of 5
Had a wonderful experience. The team was very supportive, responsive and completed everything on time. Thank you for the excellent support.
Ujwala ShettyJune 2026 - Rated 5 out of 5
Jignesh was very helpful and amazing while filling the compliance form for my business. Will take your service again.
Sumit YadavApril 2026 - Rated 5 out of 5
Good support team. No hindrance in executions. Go for it.
Upkar ChaurasiyaApril 2026 - Rated 5 out of 5
JIGNESH BHAI, I wanted to take some time to sincerely thank you for your incredible support with my MSME registration through LegalWiz. From start to finish, Jignesh Bhai, your guidance, patience, and professionalism made what could have been a stressful and confusing process feel completely smooth and manageable. You took the time to explain every step clearly, answered all my questions patiently, and ensured that nothing was left uncertain. Your attention to detail and dedication truly stood out, and it gave me a lot of confidence throughout the process. I really appreciate the effort, care, and commitment you put into helping me. Jignesh Bhai, your service has been exceptional, and I couldn’t have asked for a better experience. Heartfelt thanks once again!
Rahul SharmaApril 2026 - Rated 5 out of 5
Highly recommend services from Legalwiz. Got my LLP conversion process faster. Helpful staff.
Sharad PatelJanuary 2026 - Rated 5 out of 5
Limited Liability PartnershipHad a great experience working with the team! They handled my LLP registration smoothly, guided me clearly through every step, and were always quick to respond. Really appreciate their professionalism and support. Highly recommended!
Rishi KhannaJanuary 2026 - Rated 5 out of 5
They are so quick and highly professional and experienced in the industry to carry out the requirement. Loved their services.
SHASHANK S PANDEYJanuary 2026 - Rated 5 out of 5
Trademark RegistrationVery fast & timely service. The team was very helpful and helped me find out if the brand name was available or not over the call itself without any extra cost or charge. Brilliant service, very clear communication, timely delivery & transperant pricing. Cheers!
Naman PiparaOctober 2025 - Rated 5 out of 5
Trademark RegistrationSatisfied with your unit service and fee grateful to connect with you service providers staff thanks regards Shivlal
SHIVLAL MALVIYAOctober 2025 - Rated 5 out of 5
File INC-20AI am very much satisfied with their service for INC 20 A. i will recommend them and definitely will keep in mind for any other service.
MANINDER KaurMarch 2025 - Rated 5 out of 5
Close a Private Limited Companyexcellent, i appreciate accountability and transparency in the process
Aditya BansalMarch 2025 - Rated 5 out of 5
Private Limited CompanyLegalwiz is doing its best to give good service to clients.
Sunil ChauhanMarch 2025 - Rated 5 out of 5
Trademark RegistrationRecently got Trade Mark registered
Devendra DklMarch 2025 - Rated 5 out of 5
Trademark RegistrationIt was an amazing experience from the support team. Thank you...
Aswin MMarch 2025 - Rated 5 out of 5
GST RegistrationHad a Seamless Experience in registering for GST. Been associated with them for 5 yrs now, and have done several LLP and GST registrations. Happy with their service, so i keep coming back.
Mr KarthikFebruary 2025
Your growth
Supported by our partners
Leverage best deals offered by the industry leaders and experience mutual growth.
Have questions? Find answers here
Still have a question? Our team is happy to help, at no charge and with no obligation to buy anything.
Which rules apply to direct selling in India?
The Consumer Protection (Direct Selling) Rules, 2021, made under the Consumer Protection Act, 2019.
They apply to direct selling entities and to direct sellers, and they cover the contract, the officers to be appointed, the disclosures to be made, and the practices that are prohibited.
What stamp duty is payable?
Stamp duty is a state subject, so the rate for an agreement of this kind depends on the state where it is executed.
We confirm it for your state as part of the drafting rather than quoting a national figure, because a single number would be wrong in most states.
Are multi-level marketing schemes allowed?
Multi-level structures are not prohibited as such, but pyramid schemes and money circulation schemes are.
The distinction turns on whether the compensation comes from actual sales of goods and services to consumers, or from recruiting further participants. Where it is the second, the agreement is not the issue.
What should the agreement cover?
At a minimum:
- The products, the territory and the term of the appointment
- The commission structure and when it is paid
- Returns, refunds and any buy-back obligation
- How your brand and marketing material may be used
- What each side may and may not represent to a consumer
- How either side may terminate, and what happens to stock on hand
From the blog
Related articles
Legal Documents & ContractsWhat is a Software Development Agreement?
Software as a Service (SaaS) is an emerging field of business in India. According to the studies, the revenue streaming from this sector is growing at the rate of approx.
6 min read
Legal Documents & ContractsSales Agreement: Meaning, Types, and Importance
A sales Agreement or an agreement to sell is the legal document that governs the terms of the sale and purchase of any asset.
5 min read
Get your direct selling agreement drafted
One master agreement, drafted against the rules as they stand.
Get started- Secure payment
- Prompt support
- Fully online
- No hidden fees