Foreign Investment in Vietnam Education

1. Legal Legislation

- Decree No. 86/2018/ND-CP dated June 06, 2018;

- Decree No. 135/2018/ND-CP dated October, 2018

- Decree No. 46/2017/ND-CP dated April 21, 2017;

- Circular No. 04/2020/TT-BGDDT dated March 18,2020;

2. Forms in which Foreigners can invest:

According to Article 18 of Decree No. 86/2018/ND-CP dated June 06, 2018 (“Decree 86”), foreign can invest in educational institutions under the forms as follows:

-  Short-term training institutions

-  Pre-school educational institutions

- Compulsory educational institutions (elementary schools, middle schools, high schools, universal schools)

- Higher educational institutions

- Branch campuses of foreign-invested higher education institutions in Vietnam

The duration of the project is no longer than 50 years from the day in which the Investment Registration Certificate is issued, but shall not exceed the renting period of land use right(s).

3. License for setting up a school in Viet Nam

To set up an education institution in Viet Nam, the investor need to have the necessary certificates and licenses:

- The Investment Registration Certificate;

- The Business Registration Certificate;

- The Approval of the establishment (for Universities and Academics, pre-schools, and compulsory schools);

- License to provide education;

For the Investment Registration Certificate (“IRC”), besides the regulations of the Law on Investment, foreign investors are required to meet the requirements as prescribed in Article 33 of Decree 86. Specifically, the project has to conform to the education institution network approved by a competent agency and is not permitted to invest in national security and defense, politics, and religions.

In addition, the competent agency that issues the IRC has to ask the appraisal opinions from the Ministry of Education and Training or the Department of Education and Training before issuing the IRC. Specifically, for the projects of establishing higher educational institutions, the agency has to submit the application documents to the Ministry of Planning and Investment to receive the appraisal opinions from the Ministry of Education and Training and from other related agencies; shall summarize the aforesaid opinions and send a report to the Prime Minister for him to make a decision on investment policy. As for the projects aiming to establish the branch campuses of foreign-invested higher education institutions, the agency has to get the appraisal opinions from the Ministry of Education and Training and for the projects of investment in establishing short-term training institutions, pre-school educational institutions, and compulsory educational institutions, the agency has to get the appraisal documents from the Department of Education and Training.

After issuing the IRC, the foreign investors can submit the application for Enterprise Registration Certificate (“ERC”) and ERC shall be issued within 5 working days from the day in which the application is accepted according to the Law on Enterprise.

4. Conditions for establishing foreign-invested educational institutions

	Pre-School	Compulsory School	Short-term training institutions	Universities	A branch campus of foreign-invested higher education institution in Vietnam
Capital*	30 million VND per student	50 million VND per student	20 million VND per student	1.000 million VND	250 million VND
The minimum average area for teaching	8m2 per student (for urban areas) and 12 m2 per student (for rural areas)	2,5 m2 per student	2,5 m2 per student	6 m2 per student	6 m2 per student
The maximum ratio of students to teacher	- As for kindergarten: 05 students per teacher. - As for pre-school: 10 – 12 students per teacher.	1.5 teachers per class for elementary school; 1.95 teachers per class for middle school; 2.25 teachers per class for high school. The number of students shall not exceed: - 30 students per class for elementary school; - 35 students per class for middle school and high school.	25 students per teacher	10 students per teacher for art majors; 15 students per teacher for science and technology majors; 25 students per teacher for social science, humanities, and economics majors – business administration major.	10 students per teacher for art majors; 15 students per teacher for science and technology majors; 25 students per teacher for social science, humanities, and economics majors – business administration major
The authority to approve the establishment	The Presidents of the provincial  People’s Committees**	The Presidents of the provincial People’s Committees**		The Prime Minister	The Minister of Education and Training
The Authority to approve the providing education	Director of the Department of Education and Training	Director of the Department of Education and Training	Director of the Department of Education and Training	Minister of Education and Training	Minister of Education and Training

* The total capital is exclusive of expenses incurred from land tenancy.

** The Minister of Education and Training has the authority to approve the request of a foreign diplomatic mission and inter-government international organization for establishing preschool and compulsory educational institutions.

5. Conclusion

With more than 40% of the population aged 25 years old and lower and an increasing number of middle-class families, Viet Nam is seen as a potential education market because Vietnamese parents are willing to pay more to provide for their children with the best education standards. In order to set up a school in Viet Nam successfully, the foreign investor should be advised and guided by the Law Firm in Viet Nam step by step. 

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