(5) CURRENT
AND
MARKETABLE.—The term 
‘‘current and marketable’’, with respect to inven-
tory— 
(A) means inventory that— 
(i) in the case of consumable or dura-
ble goods, is unopened, unused, and within 
its commercially reasonable use or shelf-life 
period; and 
(ii) in the case services and intangible 
property, including Internet sites, rep-
resents the unexpired portion of any con-
tract or agreement; and 
(B) does not include inventory that has 
been clearly described to the participant prior 
to purchase as discounted, seasonal, special pro-
motion item, or not subject to the plan or oper-
ation’s inventory repurchase program. 
(6) INVENTORY.—The term ‘‘inventory’’ means 
both goods and services, including company pro-
duced promotional material, sales aids, and sales 
kits that the plan or operation requires participants 
to purchase. 
(7) INVENTORY
LOADING.—The term ‘‘inven-
tory loading’’ means that the plan or operation re-
quires or encourages its participants to purchase in-
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ventory in an amount that unreasonably exceeds 
that which the participant can expect to resell to ul-
timate users, or to use or consume, in a reasonable 
period of time. 
(8) PARTICIPANT.—The term ‘‘participant’’ 
means a person who joins the plan or operation. 
(9) PYRAMID
PROMOTIONAL
SCHEME.—The 
term ‘‘pyramid promotional scheme’’ means a plan 
or operation by which a person gives consideration 
to a participant for the right to receive compensation 
that is derived primarily from a participant’s intro-
duction of another person into the plan or operation 
rather than from the sale of products to ultimate 
users. 
(10) ULTIMATE
USER.—The term ‘‘ultimate 
user’’ means a non-participant in the plan or oper-
ation, or a participant who purchases reasonable 
amounts of products, goods, services, or intangible 
property for personal use and whose purchase is not 
made solely for purposes of qualifying for increased 
compensation. 
SEC. 4. LIMITATIONS. 
Nothing in this Act shall be construed to— 
(1) limit the authority of any Federal official 
from 
proceeding 
against 
pyramid 
promotional 
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schemes for other violations of Federal law, includ-
ing the Federal Trade Commission Act; 
(2) allow for a defense to an enforcement action 
under section 2 of this Act that the alleged pyramid 
promotional scheme involved both a franchise to sell 
a product and the authority to sell additional fran-
chises if the emphasis of the alleged pyramid pro-
motional scheme is on the sale of additional fran-
chises; or 
(3) allow for a defense to an enforcement action 
under section 2 of this Act that the alleged pyramid 
promotional scheme included repurchase agreement 
inventory loading programs if the emphasis of the 
alleged pyramid promotional scheme is on the sale of 
additional franchises. 
Æ 
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