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The Multi-level marketing (also known as Network Marketing) has evolved as an alternative marketing strategy, modeled on the basic idea of the classical direct selling-the door-to-door selling. The MLM design compensates the door-to-door sellers not just for the sales they personally generate but for the sales generated by the people they recruit. This compensation scheme in MLM brought it close to pyramid scheme in design; makes it prone to abuse in the form of pyramid scheme. Indeed, it has been abusively used for operating pyramidal schemes; Regulators have been plagued with the problem of distinguishing MLM from pyramid scheme and sanctioning the misuses. No careful legal drafting is likely to provide a simple solution but reduces the perplexity in the factual analysis and enforcement decision making. The author in this article examined, using the doctrinal research method, the position of Ethiopian law regarding network marketing and how it deals with potential manipulation of network marketing for operating pyramid scheme. Ethiopian law on pyramidal scheme is drafted so generically and briefly, and without even mention of network marketing – the very mask in which pyramidal schemes operate. The researcher found out that such a design of Ethiopian law has resulted in legal uncertainty about the implication of operating MLM. Essential parametrizations of what is within the legal limit and when it is out there in the pyramid scheme are either vague or omitted. The author recommended the need for further elaborate rules on pyramid schemes and inclusion of some guiding standards on network marketing.