The Chinese Government issued the long-awaited Direct Selling rules on Friday, giving a legal standing to a business model that had been banned in the country since 1998.

The State Council issued the Regulation of Direct Selling Administration, which will become effective from December 1, and the Anti-Pyramid Selling Regulation.

"The legislation is to guide and regulate the development of the direct selling sector in China," the Xinhua News Agency quoted the spokesperson from the State Council as saying.

It is also to fulfil China's commitment to the World Trade Organization. The country promised to open the direct selling business within three years of its WTO entry. However, the lack of regulations made it practically impossible.

Direct selling giants like Amway Corp and Avon Products Inc expressed their welcome and support for the new regulations.

"The company is pleased to see direct selling receive legal standing in China," Amway said in a statement on Friday.

Xinhua