1. Organizational and Problem Description - Introduction

The subject organization is a Utah based multi-level-marketing company in the liquid dietary supplement industry. The market of the organization is multi-national. The size of the organization is in excess of 1,000 employees and it exceeds half billion US dollars in annual revenue.

Liquid dietary supplements create a complex international trade and regulatory compliance adjustment requirements. That is primarily because every country or market may have different regulations of what marketing or legal language on product labels and in marketing materials can be stated in support of the product. Some markets for instance do not allow the words ‘health benefits’ and require them to be replaced with the words ‘wellness promoting’. Other markets to the other hand may be more lenient and even allow the words cancer health supporting.

And additionally, the compliance adjustments may also be caused by the environment in which the organization works in. Multi-Level-Marketing is a marketing or sales approach that requires its customers to be ideally engaged and/or themselves actively interactive within the organizational marketing plan to yield greatest success. Since most markets require at least minor adaptations of the marketing plan, these adjustments need to include legal contractual language of the associated marketing sign-up forms, sales agreements, and presentations.

A simple application form or product order form for one market may need to be adapted and/or changed from one to another market. Multiple applications in various markets could even be within the European Trade Union (EU). The EU bases import decisions on one unionized contractual law. However, some countries within the Union still may require slight document adaptations. These changes can be for instance as simple as the changing out of a word or one paragraph.

While the European Union may have one common trade union, their banking systems, how consumers can pay for product and sign up for a monthly automatic shipment coming to them, may vary from the United Kingdom to Germany drastically.  Besides, the language English-German differences, the subject company investigated, required several different forms to be printed and published online.

Taking into account the EU languages, legal compliance requirements and differentiations between some of the EU members, the subject organization requires about 10 different member applications, order forms, and marketing materials. And the product itself requires about 5 to 6 different labels.

In an ideal situation, all applications and applicable requirements are investigated and planned out prior to development of the product(s) and the market(s). But because an opening of a market does not occur over night, in time, even during an about 1.5 year time of planning, EU importation regulatory requirements of labeling and active ingredients related statements may change. The EU, as probably all countries in the World may try to adopt an import policy for product that also warrants the safety of its inhabitants. Therefore it is important to them that the product does exactly function as stated and not deceiving promises are made on the product labeling.

A simple statement on a label, for instance “heals cancer” may or may not actually result in such cure as claimed in the marketing materials and/or the labels of the product. And so the regulatory affairs department of a country makes its laws based on knowledge and information as it becomes available and forbids this kind of claim. Of course these kind of regulations or limitations of certain product labeling are also dependent on the pharmaceutical industry and the medical communities involved in law making. Pharmaceutical companies might see nutritional supplements or liquid dietary supplements as competing product.

As consumer products evolve and imports of new products adapt to new market demands, the learning and adapting of the regulatory affairs officials and law makers in a country may make changes to their regulations of what can or must not be stated in marketing materials and on labels of product. And these changes and requirements of these state import regulations induced changes, modifications, and standardization of the labels, marketing materials, order forms, and application forms of the subject organization. And because the organization was involved in multiple countries with different languages, different laws, acceptable marketing rules and methods, and cultural aspects, localization of product, its labels, and the associated marketing materials was a bit complex.