Investing in higher education in Vietnam: Licensing and compliance

The higher education sector in Vietnam has attracted a significant focus in recent years for its potential growth and returns for investors. However, despite the opening up of the sector to foreign investors, the approval process is substantial, extremely technical and time-consuming. For many, it can make the decision commercially impractical. But, for the right investor, opportunities exist.

In the article below, we look at procedures, requirements and criteria regarding the establishment and licensing, compliance, employment and work permit requirements for higher education institutions in Vietnam, and we highlight critical issues and difficulties that may appear within the process and which investors should be aware of.

Key considerations regarding higher education institutions in Vietnam

The minimum required capital for a non-public higher education institution is substantial: 1,000 billion VND (equivalent to approx. 43,2 million USD)

Upon the application for Ministerial approval, which has specific requirements such as a minimum investment capital of 1,000 billion VND (in case of a non-public institution), People’s Committee approval procedures, minimum land space requirements, etc., The Ministry of Education and Training conducts a thorough evaluation of the submitted documentation, makes a report, and requests the Prime Minister to consider and approve the policy on establishment or permission for the establishment of the requesting institution.

The approval level for obtaining permission to establish the education institution is from one of the highest statutory positions in the country, the Prime Minister of Vietnam.

Within 3 years after the date of entry into force of the Prime Minister’s approval of the policy on establishment or permission for establishment of the requesting institution, if the project developer has not presented the application documentation to the Prime Minister for his decision on establishment or approval of establishment of the requesting institution, the Minister of Education and Training is responsible for reporting to the Prime Minister to request him to consider granting the decision on cancellation of the written document on approval of the policy on establishment or approval of establishment of the requesting institution.

Upon the issuance of the decision on approval of the establishment of the requesting institution, the application will be submitted to the Ministry of Education and Training, with competency of decision held by The Prime Minister of Vietnam.

The application process for establishing a higher education institution in Vietnam involves 5 Authorities: the Ministry of Education and Training, the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Home Affairs and the People’s Committee on the provincial level as well. Under these complicated regulatory conditions, the process proves to be extremely time-consuming and overpowering.

When the initial documents have been found conforming to regulations, within 60 business days, the Ministry of Education and Training shall take responsibility for undertaking or cooperating with the relevant regulatory authority in conducting evaluation of the submitted documentation and field evaluation in order to give accurate judgements on various conditions and subject matters specified in the project, preparing the complete documentation for submission to the Ministry of Planning and Investment, the Ministry of Finance and Ministry of Home Affairs to acquire their written opinions on the projects satisfying requirements set out by laws and send any notice to the project developer in case of failure to meet such requirements.

Within the permissible 30 business days of receipt of all written opinions from relevant authorities or entities, the Ministry of Education and Training consolidates all received opinions, completes the project-related documentation and submits such documentation to the Prime Minister.

The projected timeline to finalise the process of establishing the education institution is substantial and it may take years before the final stage of the approval is completed.

Upon the expiration of 4 years after the entry into force of the Prime Minister’s decision on approval of establishment of the requesting institution, unless the requesting institution meets licensing requirements for its educational operations, the Minister of Education and Training assumes responsibility for reporting to the Prime Minister to apply for his decision on cancellation of the decision on establishment or approval of establishment of the said institution, and the Ministry of Education and Training is to send the People’s Committee of the province where the requesting school is based a written notification of recovery of the right to use land for construction of the requesting institution within its jurisdiction.

Teachers, lecturers and insights on employment, labour and work permits

Pursuant to Decree 11/2016/ND-CP on guiding work permit process for teachers and lecturers, there are 2 cases regarding the procedures of the work permit application:

1. Where the employer is a Vietnam education institution, the required documents for WP applications are as following:
   • A Master’s Degree matched with a teaching major
   • Teaching experience in University or higher education of at least 3 years, suitable with the teaching major in Vietnam.
   • Criminal record clearance
   • 2 photos size 4×6
   • Notarised passport
   • Health check
   • Notarised education License of the University in Vietnam
2. Where the employer is foreign education institution based outside Vietnam and the foreign employee will work in Vietnam under an agreement on education (pursuant to Clause 1.c Article 2), the required documents for WP applications are as following:
   • A Master’s Degree matched with a teaching major
   • Teaching experience in a University or higher education of at least 3 years, suitable with the teaching major in Vietnam.
   • Criminal record clearance
   • 2 photos size 4×6
   • Notarised passport
   • Health check
   • Notarised education License of the University in Vietnam
   • The contracts or agreements signed by the Vietnamese partner and the foreign partner, including the agreements on sending foreign employee to work in Vietnam;

Criteria for lecturers in University Education Program of foreign invested educational institutions “Article 38.4”

1. The lecturers must hold at least a Master’s Degree or higher. The proportion of lecturers that hold Master’s Degrees cannot be lower than 50% of the total lecturers, except in some particular disciplines specified by the Minister of Education and Training.
2. The maximum ratio of students to lecturers is 10 students/1 lecturer, applicable to arts majors; 15/1 applicable to science and technology majors; 25 students/1 lecturer, applicable to social science, humanities and economics majors – business administration major.
3. The educational institution must have enough permanent lecturers to undertake at least 60% of the program of each discipline.
4. The foreign lecturers teaching at a foreign-invested educational institution must have experience in the discipline that they teach except the cases stipulated in point dd of this clause.
5. The foreign lecturers who teach foreign language skills at a higher educational institution must hold Bachelor’s Degrees or higher and qualifications for teaching foreign languages.

According to Decree 86/2018/ND- CP regarding foreign cooperation and investment in education, the Criteria of lecturers for education joint programme and lecturers’ qualifications are:

1. 1. As for the joint training program at a bachelor’s level, the lecturer must possess at least a Master’s Degree or higher in the discipline group being taught.
   2. As for the joint training program at a master’s level, the lecturer who teaches the subjects and modules, and guides master’s theses must possess at least a Doctorate Degree in the discipline group being taught; the lecturer who guides the practice and internship must possess at least a Master’s Degree in the major that they participate in to guide the practice and internship.
   3. As for the joint training program at doctorate level, the lecturer must process at least a doctorate degree in a discipline group suitable for the assigned subject in the doctorate course. The person who guides researchers must satisfy the requirements for guiding researchers who participate in a Vietnam’s doctorate training program.
2. The lecturer who teaches the subjects in joint training program must have experience in teaching higher education courses corresponding to his/her own majors, except the cases stipulated in clause 4 of this Article.
3. A lecturer who teaches subjects in the joint training program in a foreign language must satisfy the language proficiency requirements of the program, but his/her skills shall not be below level 5 of the Vietnam’s language proficiency framework or equivalent.
4. A native speaker who teaches language skills must possess a Bachelor’s Degree or higher and a suitable foreign language teaching certificate