Legal Question in Business Law in Florida
Starting a business
I am starting a buying and referral club. Do I have legal restrictions if it works like this:
- Someone pays $x to join.
- They must purchase $x per mth to maintain membership.
- If they refer someone who becomes a member, they are pd a referral bonus of $y.
- They get z% of the referees purchases and a% of purchases made by those referred by their referees.
- Cannot get referral bonuses of any kind unless you are a member in good standing (i.e. meet minimum purchase).
1 Answer from Attorneys
Re: Starting a business
What you've described does not violate Florida law. I suppose you're worried that you are setting up a pyramid scheme. As long as your business is based on people making purchases, not just making passive investments, you haven't set up a pyramid scheme.
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