Page:Pyramid Schemes Prohibition Ordinance (Cap. 617).pdf/3

Pyramid Schemes Prohibition Ordinance A1375 Section 3 ::(ii) a financial or non-financial benefit partly to, or for the benefit of, the new participant and partly to, or for the benefit of, another person;
 * (c) the recruitment payment referred to in paragraph (b) is entirely or substantially derived from the introduction to the scheme of a further new participant.

(2) A scheme may be a pyramid scheme regardless of—
 * (a) who holds out to a new participant the prospect of entitlement to a recruitment payment;
 * (b) who is to make a recruitment payment to a new participant; and
 * (c) who is to introduce a further new participant to the scheme.

(3) A scheme may be a pyramid scheme even if it has any or all of the following characteristics—
 * (a) the scheme involves the marketing of goods or services (or both);
 * (b) a participation payment may or must be made after a new participant begins to participate in the scheme;
 * (c) making a participation payment is not the only requirement in order to be eligible to participate in the scheme;
 * (d) making a participation payment is not the only requirement in order to be eligible to receive a recruitment payment under the scheme;
 * (e) the holding out of the prospect of entitlement to a recruitment payment does not give any new participant a legally enforceable right;
 * (f) the arrangement for the scheme is not recorded in writing (whether entirely or partly).