The Direct Selling Association (DSA) released a statement acknowledging that Delaware House Bill 162 failed to advance from committee. HB 162, described by many industry leaders as “anti-direct selling” legislation, would have mandated strict regulations for the channel, including:
- Disclosure mandates not seen anywhere else in the US
- A three-month right of rescission, which is a significant departure from the standard three-day rule
- A no time limit 90% inventory buyback requirement
- Application for all companies, regardless of size, structure or compliance history
- A failure to recognize the industry’s existing self-regulation efforts and organization
The bill was approved by the Delaware House by a vote of 27-11 in June of 2025, and the DSA has led a broad coalition of industry partners and distributors who have worked with the Delaware Senate to strengthen HB 162 while identifying unresolved issues. Since then, important improvements were made to the bill as the two entities designed legislation that would more effectively protect consumers.
“This process shows what can happen when policymakers and industry stay engaged and work through difficult issues together,” said Dave Grimaldi, DSA President and CEO. “We appreciate the leadership of Representative Melanie Ross Levin and Senator Stephanie Hansen and their willingness to listen, ask thoughtful questions and carefully consider the issues we raised. Although HB 162 did not advance this session, months of engagement positions us to begin the next legislative session with a shared commitment to legislation that better protects consumers, clearly distinguishes ethical direct selling from unlawful pyramid schemes and reflects how our channel actually operates.”
DSA member companies Amway, Plexus Worldwide and Mary Kay Inc. helped shape the amendments to the bill’s enforcement framework and worked with executives and other stakeholders across the channel to share real-world perspectives with lawmakers. However, even after the addition of improvements to several operational provisions and a modernization of the bill’s disclosure requirements were added to reflect a modern-day electronic business landscape, the DSA still held significant concerns. Specifically, HB 162 continued to tie compensation to recruitment rather than retail product sales.
“Protecting consumers is fundamental to ethical direct selling,” said Kim Drabik, Vice President of Corporate Affairs at Plexus Worldwide and Chair of the DSA Government Relations Committee. “One of the most meaningful outcomes of this process was Delaware lawmakers’ recognition that DSA member companies voluntarily operate under the DSA Code of Ethics and the industry’s self-regulatory framework, including the Direct Selling Self-Regulatory Council. Those voluntary standards provide policymakers with a strong starting point for developing legislation that recognizes ethical companies while focusing enforcement where it belongs: on deceptive practices and unlawful pyramid schemes.”
