Chapter I

General Provisions

Article 1 These provisions are formulated for the purpose of strengthening control of Chinese-foreign cooperation in running schools and promoting education in China and cooperation in the field of education with foreign countries.

Article 2 Chinese-foreign cooperation in running schools mentioned in these provisions refers to educational undertakings enrolling Chinese citizens as the main objectives and run by educational institutions (hereinafter referred to as cooperative educational institutions) established in cooperation by foreign bodies corporate, individuals and relevant international organizations and Chinese educational institutions and other social organizations with the status of legal person.

Article 3 Chinese-foreign cooperation in running schools is an important form of Chinese education in its international exchanges and cooperation, and serves as a complement to Chinese education.

Article 4 Chinese and foreign parties may run educational institutions of various forms at varying levels, excluding China’s compulsory education and those forms of education and training under special provisions by the state.

The state encourages Chinese-foreign cooperation in running schools in the field of vocational education.

Article 5 Chinese-foreign cooperation in education shall abide by the Chinese law and decrees, implement China’s guideline for education, conform with China’s need for educational development and requirement for the training of talents and ensure teaching quality, and shall not seek profits as the objective and/or damage the state and public interests.

Article 6 Chinese-foreign cooperation in running schools in China in pursuance of these provisions is under the jurisdiction and protection of Chinese law.

Article 7 The educational administration of the State Council shall be in charge of Chinese-foreign cooperation in running schools. The educational administration of the local people’s governments at the county level and higher shall be in charge of the control and supervision over cooperative educational institutions in their respective localities.

Chapter II

Establishment

Article 8 Application for cooperation in education shall meet the following requirements:

(1) A correct purpose of running education;

(2) A sound educational organization and a professionally efficient managerial staff;

(3) A qualified faculty;

(4) A campus, library, teaching instruments and equipment and living facilities that are up to requirements for running a school;

(5) A fund needed for starting the educational undertaking and a steady source of fund.

Article 9 An applicant applying for running a cooperative educational institution shall submit the following documents:

(1) A written application for running cooperative education;

(2) The articles of association of the cooperative educational institution;

(3) A feasibility report;

(4) Comments of the professional department in charge of the Chinese party to the cooperative undertaking upon examination of the project in question;

(5) A letter of intent or an agreement on the cooperation signed by both parties;

(6) A notarized or authorized credit certificate of the foreign party.

Article 10 The norms for the establishment of cooperative educational institutions offering formal schooling shall pattern after the norms for the establishment of Chinese educational institutions of the same categories.

Article 11 An application for a cooperative educational institution with an independent program offering formal higher education shall be first examined by the people’s government of the province, autonomous region, municipality or the department in charge under the State Council in accordance with the affiliation of the Chinese party to the cooperative project and then submit to the educational administration of the State Council for approval.

In the event of applying for a cooperative educational institution with a non-independent program offering formal higher education, the Chinese party to the cooperation shall be an institution of higher learning offering formal higher education, and the application shall be examined and approved by the peoples’ government of the province, autonomous region, municipality or the department in charge under the State Council in accordance with the affiliation of the Chinese party to the cooperative project and then reported to the educational administration of the State Council for the record.

Article 12 An application for a cooperative educational institution with an independent program offering formal secondary education shall be first examined by the educational department in charge in the province, autonomous region or municipality in accordance with the affiliation of the Chinese party to the cooperative project and then submitted to the people’s government of the provincial level or the department in charge under the State Council for approval and reported to the educational administration of the State Council for the record.

Article 13 An application for a cooperative educational institution offering various types of informal education and training shall be examined and approved by the educational department of the province, autonomous region or municipality or the department in charge under the State Council in accordance with the affiliation of the Chinese party to the cooperative project and reported to the educational department of the provincial government or of the State Council for the record.

An application for running a cooperative kindergarten shall be approved by the educational administration in the peoples’ government of a province, autonomous region or municipality.

Article 14 An application for cooperative education shall be denied of approval if one of the following occurs:

(1) It violates the Chinese law or decrees or regulations;

(2) It is not in keeping with China’s strategic plan for educational development;

(3) It is not appropriate for approval in other respects.

Article 15 The authorities in charge of the examination and approval shall determine whether to approve the application for running a cooperative educational institution or not within three months upon receiving the application, unless it is otherwise stipulated by other laws, decrees or regulations. The applicant which is approved for running a cooperative educational institution shall be issued a letter of approval.

Article 16 Having obtained a letter of approval for running a cooperative educational institution as having met the qualifications for establishing a school and starting enrollment, the applicant for establishing a cooperative educational institution shall register with an educational administrative department of the provincial level and obtain a permit there from. A cooperative educational institution with a cooperative education permit may start formally enrolling students in accordance with the state stipulations.

An independently established cooperative educational institution shall have the status of a legal person after official approval for registration and having been granted a permit for running a school.

Article 17 An applicant applying for official registration shall submit the documents listed below:

(1) An application for registration and a letter of approval for cooperative education;

(2) An inventory of the school site, documents on proprietary rights to the school property and school facilities;

(3) Documents confirming fund contribution and fund from the relevant authorities;

(4) Certificates of the qualifications of the chairman of the council of trustees and president of the school;

(5) Lists of the leading body and trustees of the school and the payroll of the teaching and administrative staff;

(6) The name, scale, length of schooling, composition of departments and majors and courses and the size of enrollment.

Article 18 An applicant applying for establishing a cooperative school offering formal education which has not been entirely qualified with conditions for establishing a school for formal enrollment shall be approved by the examining and approving authorities to make preparations for the establishment of a cooperative school and given a letter of approval to the effect.

An applicant having been granted approval for making preparations for establishing a cooperative school shall, within two years from the date of the approval, formally apply for establishing a cooperative school and register with the relevant authorities after official approval. In the event an applicant having failed to apply for formal establishment of a cooperative school and enrollment, the original authorities granting the approval for making preparations for establishing a cooperative school shall cancel the approval.

Enrollment is prohibited during the preparatory period.

Chapter III

Operation

Article 19 A cooperative educational institution with the status of a legal person shall assume the responsibility of running education independently.

A cooperative educational institution without the status of a legal person shall have the responsibility of running education borne by both parties to the cooperation.

Article 20 A cooperative educational institution with the status of a legal person shall establish a council of trustees; a cooperative educational institution without the status of a legal person shall set up a joint administrative organ. The leading member of the council or joint administrative organ shall be elected by the council or joint administrative organ.

Chinese members in the council or joint administrative organ shall not be less than half of the total number thereof.

Article 21 A council or joint administrative organ shall exercise the following functions:

(1) Electing, appointing and dismissing the members of the council or joint administrative organ;

(2) Appointing and dismissing the president (dean) or leading member of the school;

(3) Formulating the development plan for the cooperative educational institution;

(4) Deciding plans for raising the educational fund;

(5) Examining and approving the budget and final account of the cooperative educational institution;

(6) Administering the fund and property of the cooperative educational institution;

(7) Deciding on other major issues.

Article 22 The president (dean) or leading member of the cooperative educational institution shall be a Chinese citizen of permanent residence within China and be approved by the authorities.

The president (dean) or leading member of the cooperative educational institution which has the status of a legal person shall be the legal representative of the institution. The president (dean) or leading member shall implement the resolutions of the council and take charge of the all-round work of the cooperative educational institution.

Article 23 A cooperative educational institution may employ full-time and part-time teachers whose qualifications shall refer to those for Chinese public schools of the same categories at the same levels.

Employment of foreign teachers and administrative personnel shall refer to relevant Chinese state provisions regarding employment of foreign cultural and educational experts and foreign teachers.

The employment, firing, remuneration, welfare and working conditions in a cooperative educational institution shall be defined in contracts signed between the institution authority and the employee in accordance with law.

Article 24 The activities of the basic organizations of the Chinese Communist Party, labor union and other social organizations in a cooperative educational institution shall refer to the relevant Chinese law and the articles of association of the relevant organizations.

Article 25 The enrollment of a cooperative educational institution offering formal education shall be conducted in pursuance of relevant Chinese regulations and under the unified control of the state enrollment plan.

A cooperative educational institution enrolling students outside China shall refer to the stipulations by the educational administrative department of the State Council regarding enrollment of foreign students.

Article 26 A cooperative educational institution conducts its teaching with full autonomy provided it adheres to the state educational guideline and the goals and basic specifications for training useful personnel for society determined by the state.

The basic language used in a cooperative educational institution is Chinese, but certain courses may be taught in foreign languages.

Article 27 A cooperative educational institution offering formal education shall grant diplomas in accordance with relevant Chinese regulations. A cooperative educational institution offering informal education shall issue to its graduates certificates of practical learning or appropriate certificates of qualifications authorized by the state.

With the approval by the academic degree authorities under the State Council, a cooperative educational institution may grant certificates of Chinese academic degrees.

A cooperative educational institution granting foreign diplomas or certificates of academic degrees shall need the approval by the Chinese state organs in charge of diplomas and academic degrees. The recognition of such diplomas and academic degrees should be conducted in accordance with relevant state regulations.

A cooperative educational institution offering vocational training may issue certificates of qualifications of the country of the foreign cooperative partner or of international recognition.

Article 28 The starting fund of a cooperative educational institution, tuition fees collected from students and the fund (including facilities) raised in the name of the cooperative educational institution shall be used solely for the expenditure and development of the institution, and shall not be used for other purposes.

Article 29 A cooperative educational institution shall have a sound financial and accounting system complete with professional accountants and accounting books and subject to the audition by the department in charge and the auditing authorities.

Article 30 The property of a cooperative educational institution shall be managed and used by the institution under the protection of Chinese law when the institution exists. The assets and facilities directly used in education and teaching shall not be sold, transferred or mortgaged.

Article 31 A cooperative educational institution in importing goods for scientific research and education shall refer to the state “Procedures for Exemption of Customs Duties on Imports of Goods for Scientific Research and Education” and other relevant regulations.

Chapter IV

Supervision

Article 32 A cooperative educational institution should accept the guidance, control, supervision, appraisal and checks by the educational administrative department.

Article 33 In one of the following cases, a cooperative educational institution may apply to the approving authorities for dissolution:

(1) When a situation defined as fit for dissolution by the articles of association of the school arises;

(2) When it has failed to reach the set objectives;

(3) When there is a serious shortage of the resources (such as fund, student supply or teaching staff) for normal operation.

Article 34 After the dissolution of a cooperative educational institution, the educational administrative department or a professional department in charge under the State Council shall organize the relevant financial and auditing departments to conduct liquidation of the school property; part of the property of cooperative educational institution after liquidation shall be returned to or converted into money and repaid to the original contributors according to the original agreement, and after the aforesaid payment, the part of the school property including donations from various quarters of the society shall become state property and to be used to develop education.

Upon dissolution of a cooperative educational institution, the founders in charge shall make proper arrangements for the resettlement of the students at school.

Article 35 When the council of a cooperative educational institution is unable to convene because of major disputes or because of breaches of the law, the educational administrative department shall order it to make consolidation within a specified time, and if it has not been consolidated in time or to n avail, the educational administrative department in charge shall order it to be reorganized or to take necessary measures to make due consolidation in accordance with the articles of association of the council.

Article 36 If a cooperative educational institution violates these provisions in one of the following ways, the educational administration of the provincial level shall mete out an administrative penalty of a warning, a fine, confiscation of the illegal gains, ordering it to make consolidation within a specified time, or to suspend enrollment or suspend operation in the light of the gravity of the case:

(1) Starting preparations for establishment or starting enrollment without official approval;

(2) Winning approval for preparing for establishment or officially establishing a school and starting enrollment by means of lies, fraud and false certification;

(3) Taking tuition or granting diplomas or certificates in violation of relevant provisions;

(4) Poor management and inferior teaching quality;

(5) Other law breaking activities.

Article 37 The party concerned who does not agree to the administrative penalty may plead for a review of the case or bring up an administrative procedure. If the party does not request for review or bring up an administrative procedure within the legitimate time limit and refuses to accept the penalty, the educational administration may request the peoples’ court to coerce the party to accept the penalty.

Article 38 Disputes between the Chinese and foreign parties to cooperative education over a contract or articles of association may be settled through consultation or mediation. If the parties do not agree to settle the dispute through consultation or mediation, or if consultation or mediation fails, they may bring the case for a Chinese arbitral body for arbitration in accordance with the written clauses or agreement already reached. If there are no written clauses or agreement on arbitration, either party may bring the case to a Chinese court.

Chapter V

Auxiliary Provisions

Article 39 When organizations or individuals with the status of a legal person in Hong Kong and Macao and domestic organizations with the status of a legal person intend to run cooperative education, they shall refer to these provisions.

The state educational administration shall join other departments concerned to formulate separate provisions for educational institutions to be run on the mainland by Taiwan civil organizations or individuals with the status of legal person.

Article 40 Organizations or individuals outside China shall not run schools or other educational institutions on their own and enroll Chinese citizens within the Chinese territory.

Overseas organizations or individuals running schools in China which enroll the children of foreign nationals residing in China shall follow relevant Chinese provisions.

Article 41 Foreign bodies corporate and individuals and relevant international organizations mentioned in Article 2 of these provisions exclude religions organizations and clergyman.

Article 42 People’s governments of the provinces, autonomous regions and municipalities may formulate rules for implementation of these provisions in the light of the actual conditions of respective localities.

Article 43 These provisions shall come into effect as of the date of implementation.