The jurisprudential ruling on network marketing has always been a subject of ambiguity, and some have exploited this ambiguity by making false claims, distorting facts, and posing unclear questions in an attempt to present the religious opinions on network marketing in a way that is different from what they truly are.
What is the religious ruling on network marketing according to religious authorities?
Today, network marketing has become one of the common methods for selling products, and some individuals have exploited its ambiguities by falsifying, distorting, and asking vague questions in an attempt to present the religious views on network marketing as something other than what they are. Therefore, it is better to first seek the views of religious authorities on this matter.
What is Network Marketing?
Network marketing, also known as multi-level marketing (MLM), refers to a type of product sales strategy with a different approach. In this form of marketing, the manufacturing company delivers its products directly to customers through a group of marketers without intermediaries or brokers. In network marketing, leaders aim to recruit more marketers into the company. The branching system of network marketing is one of the similarities between this type of sales and pyramid schemes. However, it should be noted that there are many differences between this type of selling and pyramid schemes or internet-based sales systems.
🕌Religious Authorities' Views on Network Marketing:
Most religious authorities have prohibited earning money through network marketing. However, some authorities (like Ayatollah Shobiri Zanjani and Ayatollah Alavi Gorgani) have set conditions for the legitimacy of such companies, which essentially outline the characteristics of healthy network marketing companies. Therefore, these two authorities have also prohibited unhealthy network marketing. Below are further details on their views.
👳🏻Ayatollah Khamenei:
The official website of the Supreme Leader’s office responded regarding network marketing companies on December 30, 2016. The question was as follows:
"As you know, a regulation for the activity of network marketing companies has been approved by the Ministry of Industries. Please provide Ayatollah Khamenei’s opinion on this regulation and activities based on it."
Response: If the mentioned regulation is approved by the Guardian Council, economic activities in accordance with it are not problematic.
Based on this question and response, Ayatollah Khamenei has referred the matter of whether such activities are permissible or forbidden to the Guardian Council.
👳🏻Ayatollah Sistani:
Ayatollah Sistani believes that this type of marketing is forbidden, and his followers should avoid participating in such activities. Even though the Ministry of Industry and the Guardian Council of the Islamic Republic of Iran have deemed this activity permissible according to the regulation, Ayatollah Sistani still considers it forbidden.
👳🏻Ayatollah Makarem Shirazi:
Greetings and salutations. Network marketing is only permissible if it is not hierarchical or multi-level, and the profits are exclusively for the first marketer. Otherwise, it is problematic.
It is possible that in some new schemes, certain issues with this practice have been addressed, but the main issue—intermediary marketers—still exists, and it amounts to earning money unlawfully.
👳🏻Ayatollah Alavi Gorgani:
Contrary to the rumors about Ayatollah Alavi’s views on network marketing, he believes that participating in such companies is not permitted, and his followers should refrain from engaging in such activities.
👳🏻Ayatollah Safi Golpaygani:
Ayatollah Safi Golpaygani’s opinion is as follows:
"In the name of Allah, the Most Gracious, the Most Merciful. Greetings and peace be upon you. In general, charging a specific amount for selling goods and introducing customers under the title of 'contract' is permissible. However, claiming payment for the actions of subsequent individuals (who were introduced by the initial marketer) is not legitimate unless the company itself voluntarily pays something."
👳🏻Ayatollah Nouri Hamedani:
He believes that earning money through network marketing is not permissible.
👳🏻Ayatollah Shobiri Zanjani:
Network marketing is only permissible if the following conditions are met:
The transaction is real and valid.
The profit is for a legitimate activity such as introducing customers—even with intermediaries.
All legal authorities consider it permissible, and the company complies with these regulations.
It does not cause any economic corruption. Therefore, if the network marketing resembles pyramid schemes like GoldQuest, it is problematic.
Given the above conditions, it is rare to find a company that meets all of them, so it is strongly advised to avoid such activities. Even in cases where it may be permissible, caution is advised.
👳🏻Ayatollah Vahid Khorasani:
The official website of Ayatollah Vahid Khorasani states:
"Is network marketing permissible?"
Answer: "Network marketing is not permissible based on obligatory caution, and you cannot refer to someone else on this matter."
Thus, Ayatollah Vahid Khorasani also does not consider network marketing permissible.
What Are the Differences Between Healthy Network Marketing and Pyramid Schemes?
"Pyramid companies" and "network marketing companies" are two terms that are often confused due to their unclear definitions. One major difference between network marketing and pyramid schemes is the prohibition of receiving any payment under the title of membership fees, deposits, or accepting representation for any other profitable economic activity in network marketing companies. Additionally, the sole focus on expanding the human network and recruiting distributors, along with money circulation, offering illusory products, buying and selling positions in a tree structure, or products that might be produced in the future, distinguishes network marketing companies from pyramid schemes. Moreover, pyramid scheme managers typically try to introduce exclusive products to the market, not to enrich the sales market but to sell goods with no existing alternatives and no set price. This strategy allows them to sell their products at any price.
