Order No. 372 by State Council
Chapter 1 General Provisions
These Rules have been formulated in accordance with the PRC Education Law, the PRC Vocational Education Law, the PRC Law on Promotion of Non-government-run Education in order to regulate the activities of Sino-foreign jointly run education, enhance educational exchange and cooperation overseas and advance the education cause.
These Rules shall apply to the joint running of an educational institution by Chinese and foreign education institutions (hereinafter referred as "SFJRS Operator") within the PRC territory that mainly recruits Chinese citizen students.
Sino-foreign Jointly Run Schools (SFJRS) are of the nature of non-for-profit cause and form an integral part of Chinese education system.
In regulating and administration of SFJRS, the PRC adopts the principles of expanding the opening to the outside world, running schools up to standards, administering by law and encouraging its development.
The PRC encourages the SFJRS that introduces advanced foreign education resources. The PRC encourages SFJRS in higher education and vocational education, especially SFJRS by Chinese higher education institutions and renowned foreign higher education institutions.
The lawful rights and interests of SFJRS and SFJRS Operators are protected under Chinese law.
SFJRS is entitled to preferential tax treatments and independently undertake education activities in accordance with law.
SFJRS must abide by Chinese law, follow Chinese education guidelines, and observe public morals and must not impair the sovereignty, security and public policy of the PRC.
SFJRS should be in line with the actual demand of Chinese education development, ensure quality education and be dedicated to incubating various talents needed by the cause of socialism with Chinese characteristics.
SFJRS Operators may run various education institutions at various levels except for those providing compulsory education and special education such as military, police and politics.
Foreign religious organization, institution, academy or personnel must not carry out SFJRS within the territory of China.
SFJRS must not provide religious education or carry out other religious activities.
The education authority under State Council shall be responsible for nation wide administration of SFJRS planning, synthesizing and macro control. The education authority, labor authority and other competent authorities shall be responsible for specific administration of SFJRS respectively within their respective power provided by the state Council.
The education authority under the provincial government shall be responsible for province wide administration of SFJRS planning, synthesizing and macro control. The education authority, labor authority and other competent authorities under the province level shall be responsible for specific administration of SFJRS in the provincial region respectively.
Chapter 2 Establishment
The education institution applying for the establishment of SFJRS shall have legal person status.
SFJRS Operators may contribute to SFJRS fund in the form of cash, in-kind asset, land use right, intellectual property right and other property/asset.
Contributions made by each SFJRS Operator in the form of intellectual property right must not exceed one third of the total amount of contribution made by such Operator. Notwithstanding the previous provision, if a foreign education institution is invited by the education authority or labor authority under the State Council, or by provincial education authorities or labor authorities, to operate SFJRS, such foreign institution may contribute in the form of intellectual property right more than one third of the total amount of contribution made by such Operator.
SFJRS shall meet the basic conditions set forth in the PRC Law of Education, the PRC Vocational Education Law, and the PRC Law of Higher Education and shall possess legal person status. Notwithstanding the previous provision, SFJRS, which provides higher education and is established by foreign education institution and Chinese higher education institution (that also provides degree-awarding), does not have to possess legal person status.
The establishment of SFJRS shall be in line with the relevant establishment standards set forth for similar government-run education institutions at similar level.
Application for establishment of SFJRS that provides bachelor or above degree higher education shall be subject to examination and approval by the education authority under State Council; application for establishment of SFJRS that provides diploma (two-year college) higher education or non-degree-awarding higher education shall be subject to examination and approval by the government of the province/central municipality/ autonomous region where the SFJRS locates. Application for SFJRS providing middle degree-awarding education, self-taught education study guide, academic remediation, and pre-school education, shall be subject to examination and approval by provincial level education authorities of the province/central municipality/ autonomous region where the SFJRS locates. Application for establishment of SFJRS providing vocational skills training shall be subject to examination and approval by provincial level labor authorities of the province/central municipality/ autonomous region where the SFJRS locates.
Establishment of SFJRS shall take two steps: preparatory establishment and formal establishment. However, a SFJRS that meets all required conditions and establishment standards may apply for formal establishment directly.
Application for preparatory establishment of SFJRS shall include the following documents:
14.1 written report of establishment, covering identities of SFJRS Operators, name of the SFJRS to be established, goals of education, scale of the school, level of education, form of SFJRS, qualifications, internal management system, fund raising and disbursement;
14.2 cooperation agreement, including among other things term of cooperation, dispute resolution etc.;
14.3 source of assets, amount of funds and verification documents stating titles of such;
14.4 donation letter/agreement, stating name of donators, their respective amount of donations, use and rules of control of such donations, and the related verification documents;
14.5 evidence of payment of initial funds no less than 15% of the total funds.
The examination and approval authorities shall decide to approve or disapprove the application within 45 working days after receipt of such application for preparatory establishment. In case of approval, approval certificate shall be issued; in case of disapproval, written explanation of the decision shall be provided.
SFJRS approved of preparatory establishment shall submit application for formal establishment within 3 years after the date of approval; if such application is made late, SFJRS Operators must submit an entirely new application.
No recruitment of students can be done during the preparatory establishment.
Application for formal establishment upon preparatory establishment shall include the following documents:
17.1 written application for formal establishment;
17.2 approval certificate for preparatory establishment;
17.3 report of preparatory establishment;
17.4 articles of association of SFJRS, name list of members of first council, board of directors or joint management committee;
17.5 verification documents of the assets of SFJRS;
17.6 qualification documents of the principal and other senior executives of SFJRS;
Application for direct formal establishment shall include documents mentioned in 17.1, 17.4, 17.5, 17.6, 14.2, 14.3, and 14.4.
The examination and approval authorities shall decide to approve or disapprove the application for formal establishment of non-degree-awarding SFJRS within three months after receipt of such application. In case of degree-awarding SFJRS, the examination and approval authorities shall decide to approve or disapprove the application for formal establishment within six months after receipt of such application. SFJRS license, which is uniformly formatted and numbered, will be issued upon approval. If the application is disapproved, written explanation of disapproval decision shall be provided to applicants.
SFJRS license will be formatted and patterned by the education authority under State Council and printed under the instruction of education authority and labor authority under the State Council according to their respective responsibilities. SFJRS licenses will be uniformly numbered in accordance with detailed rules to be promulgated by the State Council education authority in consultation with the State Council labor authority.
After receipt of application for formal establishment of SFJRS that provides degree-awarding education, the examination and approval authorities shall organize experts committee to evaluate such application and provide expert opinions.
After being issued SFJRS license, the SFJRS shall apply for registration procedure in accordance with relevant laws and regulations. Registration authority shall receive and go through the registration procedure promptly in accordance with relevant regulations.
Chapter 3 Organization and Management
SFJRS that has a legal person status shall set up councilors board or board of directors. SFJRS that does not have a legal person status shall set up joint management committee. At least 1/2 of the members of the councilors board, board of directors or joint management committee shall represent the Chinese party of SFJRS.
The councilors board, board of directors or joint management committee shall have at least 5 members with one chairman and one vice chairman. If one party of SFJRS appoints chairman, the other party shall appoint vice chairman. The candidate of legal representative of SFJRS that has legal person status shall be determined by all parties through consultation and be chosen from chairman, vice chairman or principal.
SFJRS's council, board or joint management committee shall consist of representatives of SFJRS Operators, principal or main executives, and representatives of teaching and supporting personnel. At least 1/3 of the members of such shall have more than five years of experience in education management and/or teaching. A name list of members consisting the council, board or joint management committee shall be filed with the examination and approval authority.
The council, board or joint management committee is entitled to exertion of the following rights:
23.1 to reelect or by-elect members of the council, board or joint management committee;
23.2 to appoint, dismiss principal or other senior executives;
23.3 to revise articles of association and formulate rules and regulations;
23.4 to institute long-term plan, approve annual work plan;
23.5 to raise school fund, review and approve budgeting and final accounting;
23.6 to determine faculty and supporting staff quota and remunerations;
23.7 to decide separation, merger or termination of SFJRS;
23.8 to exercise other rights stipulated by the articles of association.
The council, board or joint management committee shall hold at least one meeting per year. On a motion of not less than 1/3 of members, interim meetings can be convened. Decision with respect to the following matters shall require approval by more than 2/3 of members:
24.1 appointment or dismissal of principal or other senior executives;
24.2 revision and amendment of articles of association;
24.3 formulation of development plan;
24.4 decision with respect to separation, merger or termination of SFJRS;
24.5 other major matters stipulated in articles of association.
Principal or other senior executives of SFJRS shall have Chinese national status and reside in Mainland China. Such principal or senior executive shall be patriotic, have morals and integrity, be experienced in education management or teaching and equipped with relevant professional qualifications.
Candidates for principals or senior executives shall be approved by examination and approval authorities.
Principal or senior executive shall be entitled to exercise the following responsibilities and powers:
26.1 to implement decisions of council, board or joint management committee;
26.2 to implement development plan and propose annual planning, financial budgeting and rules and regulations;
26.3 to recruit or dismiss staff and faculty members, exercise awards or penalties;
26.4 to organize educational and research activities and ensure quality education;
26.5 to be responsible for daily management and operation;
26.6 other responsibilities stipulated in articles of association.
SFJRS shall administer faculty and students in accordance with law.
Foreign teachers or administrative staff that SFJRS employs shall have bachelor or above education degree and relevant vocational certificates, and have more than 2 years of experience in education or teaching. Foreign SJFRS Operator shall select and assign a certain number of faculty members of its own institution to teach in SFJRS.
SFJRS shall protect legitimate rights and interests of teachers and students, ensure salaries and other benefits of teachers and pay social insurance premiums thereof.
Faculty and supporting staff of SFJRS may organize unions and other organizations in accordance with law and participate in the democratic management of SFJRS through general assembly of teachers and supporting staff.
Foreign staff of SFJRS shall abide by relevant regulations pertaining to employment of foreign people in China.
Chapter 4 Education and Teaching
SFJRS shall open courses with respect to the Constitution, laws, citizen ethics, and situations of China, as required of similar domestic education institutions at the same level.
The government encourages introduction of internationally advanced courses and teaching materials that are in great demand in China
SFJRS shall file the courses to be opened and teaching materials introduced from abroad with examination and approval authority.
SFJRS may use foreign languages in teaching as needed. However the basic language shall be mandarin and standard Chinese characters.
The recruitment of students by SFJRS that operates higher degree-awarding education shall be included in the national higher education college/university recruitment plan. The recruitment by SFJRS that operates other degree-awarding education shall be conducted according to provisions and rules set forth by provincial level education authority. Recruitment of overseas students shall be carried out according to relevant rules and regulations of PRC.
Recruitment prospectus and advertisement must be filed with examination and approval authorities.
SFJRS should periodically publicize the particulars with respect to type and level of school, majors and specialties, curriculum and size of recruitment.
Degree-awarding SFJRS shall issue certificate of degree or other certificate of schoolwork according to relevant laws and regulations. Non-degree SFJRS shall issue certificate of training or certificate of completion of education. State certificate of vocational qualification may be awarded according to relevant laws and regulations if students that receive vocational training are verified as up-to-standards by vocational skills/qualification appraisal agencies licensed by the government.
SFJRS that provides higher degree education may issue equivalent Chinese degree certificate in accordance with Chinese laws and regulations.
Foreign education institution's certificate of degree or diploma issued by SFJRS shall be the same as those issued by such foreign institution in its original country and recognized by such country.
Recognition of foreign education institution's certificates of degree or diploma issued by SFJRS shall be conducted in accordance with relevant international treaty that the PRC joined or concluded or relevant PRC laws and regulations.
Education authority under the State Council, education and labor authorities at provincial level, and other competent authorities shall ensure day-to-day monitoring of SFJRS, organize or entrust non-government agencies to evaluate the quality of education of SFJRS, and publicize results of such evaluation.
Chapter 5 Assets and Finance
SFJRS shall establish sound financial, accounting and asset management rules and set up accounting books as required by relevant rules and regulations.
During the continuation of SFJRS, all assets shall fall under SFJRS's legal person property right and be free from conversion or misappropriation by any organization or natural person.
SFJRS shall determine its fees and charges and rates thereof in accordance with relevant pricing regulations of the government and publicize such. No addition of new charge item or increase of rate is allowed without approval. SFJRS shall calculate and collect tuition and other charges in RMB and must not calculate and collect such in foreign currency.
The tuition and charges collected by SFJRS shall be used mainly in education and teaching activities and for the purpose of improving operation conditions of the school.
SFJRS shall abide by relevant foreign exchange regulations in foreign currency remittance and receipt, opening and utilization of foreign exchange accounts.
SFJRS shall prepare financial statements by the end of each accounting year and entrust independent auditor to review and audit the statements. Results of such auditing shall be publicized and reported to examination and approval authorities.
Chapter 6 Alternation and Termination
Application for separation and merger of SFJRS shall be submitted, upon completion of financial liquidation, by the council, board or joint management committee to examination and approval authorities for approval.
Examination and approval authorities shall decide to approve or disapprove application for separation or merger of SJFRS within 3 months if such SFJRS provides non-degree-awarding education, or within 6 months if it provides degree-awarding education.
Alternation with respect to SFJRS Operator shall be proposed by Operators. Upon completion of financial liquidation and approval by the council, board or joint management committee, such proposal shall be submitted to examination and approval authorities for review and approval. Relevant procedures required for alternation shall be conducted afterwards.
Alternation with respect to SFJRS's location, legal representative, principal or senior executive shall be reviewed and approved by examination and approval authorities and finalized after all necessary alternation procedures are completed.
Alternation with respect to SFJRS's name, level, and type shall be submitted by the council, board or joint management committee to examination and approval authorities for approval.
Examination and approval authorities shall respond in writing to application for alternation into non-degree-awarding SFJRS within 3 months after receipt of application, or within 6 months to application for alternation into degree-awarding SFJRS.
In any of the following circumstances, SFJRS should be terminated:
45.1 as stipulated in articles of association and approved by examination and approval authorities;
45.2 if SFJRS license is revoked;
45.3 insolvency so that it is not possible to continue operation and approved by examination and approval authorities.
In case of termination, SFJRS shall appropriately place its students. Placement plan of current students shall be submitted together with application for termination.
SFJRS shall conduct financial liquidation in case of termination. If the termination is voluntarily initiated by SFJRS, the liquidation process shall be organized by SFJRS itself. If SFJRS is cancelled by examination and approval authorities in accordance with law, the liquidation shall be organized by the authorities. In case of termination as a result of insolvency, application for liquidation shall be submitted to the People's Court of China in accordance with law.
In SFJRS liquidation, the following order shall be observed in discharging outstanding debts and obligations:
47.1 refund tuition and other charges to students;
47.2 payment of due salaries and social insurance premium;
47.3 other due debts and obligations.
Any remaining assets after discharging all the above debts and obligations shall be disposed in accordance with law and regulations.
In case of termination of SFJRS as approved by authorities or revocation of SFJRS license, SFJRS shall return such license and stamp to authorities and apply for cancellation procedures according to law.
Chapter 7 Penalties
Examination and approval authorities and employees thereof that take advantage of the post and gain proceeds or other benefits, abuses his/her power of office, neglect his/her duties so that SFJRS license is issued to unqualified applicants, or knowingly fails to investigate and penalize illegal activities, resulting in serious consequences and violating criminal law, the responsible person in such authorities or other directly responsible personnel will be charged of criminal offence in accordance with the stipulations under criminal law with respect to bribery, abuse of power of office, neglect of duty or other criminal offences. If the consequences are not so serious as to constitute criminal offence, administrative punishment will be imposed.
Approval of SFJRS exceeding the power of office by authorities and in violation of these Regulations, the approval shall be void and null and be rectified as required by superior authorities. Responsible official of the default authority or other directly responsible personnel shall be imposed of administrative punishment. In case such illegal approval causes serious losses to public assets, interests of nation or people in general, such personnel will be run against for criminal offence under the category of abuse of power of office or other offences.
In case of establishment of SFJRS without approval or obtaining license through illegal means, education authorities and labor authorities, or jointly with public security authorities, will clamp down such illegal SFJRS in their respective responsibilities. The authorities may demand the illegal SFJRS to refund tuition fees and other charges to students and impose amercement in an amount of less than RMB100,000. In case such illegal SFJRS breaches criminal law, it will be run against under the category of chicane.
Recruitment of students during preparatory establishment which is in breach of the Regulations hereof will be subject to penalties charged by education and labor authorities including suspension of recruitment, refund of all tuition and charges, amercement in an amount of less than RMB 100,000. In serious cases where the illegal SFJRS resists to suspend recruitment, the examination and approval authority may cancel the approval certificate for preparatory establishment.
If SFJRS Operators make a false capital contribution or surreptitiously withdraw contributions after establishment, education and labor authorities may demand rectification within prescribed period; if no rectification is done within such period, the authorities impose an amercement in an amount of less than two times the contribution falsely made or surreptitiously withdrawn.
Forging, alternation and sales of SFJRS license will be investigated against according to criminal law's provisions with respect to crime of forging, alternation and sales of official document/certificate or other related crimes.
Unapproved addition of fee items or increase of fee rates will result in orders by authorities to refund the excessive fees and punishment by pricing authorities according to law.
If SFJRS has badly managed and poor quality of teaching and education, which causes serious consequences, education and labor authorities will demand to rectify within prescribed period. In serious cases where SFJRS refuses to rectify or the results of rectification are below requirements, the authorities may force suspension of recruitment and revocation of SFJRS license.
If SFJRS publicize false recruitment prospectus so as to default of lucre, education and labor authorities within their respective responsibilities can force rectification within prescribed period and impose an admonition. If any illegal lucre is gained, such lucre will be returned and an amercement in an amount of less than RMB100,000 will be imposed. In serious cases, authorities can force suspension of recruitment and revoke SFJRS license. If such act constitutes a crime, it will be investigated according to criminal law with respect to fraud. False advertisement by SFJRS will be investigated according to the PRC Advertisement Law.
If a SFJRS is revoked of SFJRS license, its chairman of the council or board or chief executive shall not hold the similar post within 10 years after the revocation of license.
If a breach of these Regulations constitutes a crime, such person shall not conduct Sino-foreign cooperative education activities within 10 years after the completion of his/her sentence.
Chapter 8 Additional Provisions
Cooperative school operation between Mainland institutions and institutions in Hong Kong SAR, Macao SAR and Taiwan shall be conducted by reference to these Regulations.
Administration of Sino-foreign for-profit cooperative training institutions that are registered at State Administration of Industry and Commerce will be separately formulated by the State Council.
The detailed examination, approval and administration rules of SFJRS that mainly recruits Chinese students and provides degree-awarding education, self-taught study guide and pre-school education shall be formulated by education authority under State Council.
The detailed examination, approval and administration rules of SFJRS that mainly recruits Chinese students and provides vocational skill training shall be formulated by labor authority under State Council.
Article 62 Foreign education institution, organization or individuals must not independently establish schools or other educational institutions in China that mainly recruits Chinese citizens. Article 63 SFJRS legitimately established prior to the issuance of these Regulations shall apply for SFJRS license as well. If any of such SFJRSs falls below the requirements stipulated herein, a grace period of two years will be granted for such SFJRSs to live up to the standards and requirements. If upon expiration of such period, any SFJRS still falls below the requirements, such SFJRS will cancelled by competent authorities. Article 64 These Regulations shall take effect since September 1, 2003.