Circular No. 45/2014/TT-BGDĐT on the conversion of private universities to private universities.

CIRCULAR

Article 24regulating the conversion of private universities to private non-profit universities

from private universities to private non-profit universities

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Pursuant to the Education Law on June 14, 2005; the Law Amending and Supplementing Certain Articles of the Education Law on November 25, 2009;

Pursuant to the Higher Education Law on June 18, 2012;

Pursuant to Decree No. 75/2006/NĐ-CP dated August 2, 2006 of the Government detailing and guiding the implementation of certain provisions of the Education Law; Decree No. 31/2011/NĐ-CP dated May 11, 2011 of the Government amending and supplementing certain provisions of Decree No. 75/2006/NĐ-CP dated August 2, 2006 and Decree No. 07/2013/NĐ-CP dated January 9, 2013 of the Government on amending Point b Clause 13 Article 1 of Decree No. 31/2011/NĐ-CP dated May 11, 2011 amending and supplementing certain provisions of Decree No. 75/2006/NĐ-CP dated August 2, 2006 of the Government detailing and guiding the implementation of certain provisions of the Education Law;

Pursuant to the Government Decree No. 141/2013/NĐ-CP dated October 24, 2013 detailing and guiding the implementation of certain articles of the Higher Education Law;

Pursuant to Decree No. 69/2008/NĐ-CP dated May 30, 2008 of the Government on policies encouraging socialization for activities in the fields of education, vocational training, health care, culture, sports, and environment;

Pursuant to Decision No. 122/2006/QĐ-TTg dated May 29, 2006 of the Prime Minister on the conversion of private universities to private non-profit universities;

Pursuant to Decision No. 70/2014/QĐ-TTg dated December 10, 2014 of the Prime Minister on promulgating the Charter of Universities;

At the proposal of the Director of the Department of Planning and Finance, the Minister of Education and Training issues this Circular regulating the conversion of private universities (hereinafter referred to as private universities) to private non-profit universities (hereinafter referred to as non-profit universities), including: contents, procedures, formalities, and responsibilities of organizations and individuals in the conversion of private universities to non-profit universities.

PART I
GENERAL PROVISIONS

Article 1. Scope of Regulation and Applicability

1. This Circular regulates the conversion of private universities (hereinafter referred to as private universities) to private non-profit universities (hereinafter referred to as non-profit universities), including: contents, procedures, formalities, and responsibilities of organizations and individuals in the conversion of private universities to non-profit universities.

2. This Circular applies to private universities and related organizations and individuals.

Article 2. Requirements for Conversion

The conversion process shall not affect the normal operation of the university, shall not cause difficulties for students, and shall ensure the rights and legitimate interests of the university's employees, individuals, and organizations involved.

Article 3. Full-time Lecturers

A full-time lecturer is an employee who signs a labor contract with a term of three years or an indefinite-term labor contract according to the Labor Code, is not a civil servant or state official, and is not working under a labor contract with another employer for a term of three months or more; the university pays their salary and covers benefits according to current regulations.

Chapter II
CONTENTS OF CONVERSION

Article 4. Financial Audit and Asset Valuation

1. The audit date is the latest quarter or year-end financial report date decided by the University Board of Directors, but not later than twelve months from the date of submitting the conversion application to the Ministry of Education and Training.

2. The financial audit and asset valuation shall be conducted in Vietnamese Dong, in accordance with the law, by an independent auditing company and an independent valuation company with legal personality.

3. The audit report must classify capital according to its source of formation:

a) Initial capital contributions and capital contributions during the operation of the university from organizations and individuals;

b) Capital received as gifts, donations, or grants from lawful sources;

c) Capital formed during the operation of the university;

d) Capital borrowed or leased from domestic or foreign organizations and individuals.

4. The audit report must determine the actual total capital, liabilities for debts, and the reasons for discrepancies between actual figures and book records at the audit date (if any).

5. The audit report must be publicly posted to ensure that shareholders, full-time lecturers, and employees of the university can conveniently monitor and supervise.

Article 5. Handling of capital, assets, and land of private schools when transitioning to private schools

1. The initial capital contributed by organizations and individuals and the capital contributed during the operation of private schools shall be converted into Vietnamese dong at the time of contribution, maintained in value at the time of transition based on agreement between the Board of Directors and contributing organizations and individuals, and converted into shares upon transitioning to private schools.

The Board of Directors of private schools shall decide on the method for maintaining the value of contributed capital by organizations and individuals.

2. Assets donated, gifted, or provided and formed from the results of operations of private schools are collectively owned assets that are indivisible and shall be transferred as collectively owned indivisible assets of private schools.

3. After being recognized as transitioning from private schools, private schools shall inherit legitimate rights and interests, be responsible for unpaid debts and other property obligations of private schools.

4. Private schools shall hand over all land area and assets on land currently in use along with relevant documentation to private schools. Private schools shall be responsible for managing and using the handed-over land and assets on land for their intended purpose and bear responsibility related to the use of land and assets on land.

Article 6. Rights and benefits of organizations applying to establish schools, individuals who have made contributions during the establishment and development of private schools, and current members of the Board of Directors

1. Organizations applying to establish private schools shall be prioritized to contribute capital from non-governmental sources to become shareholders of private schools. Organizations applying to establish private schools that do not contribute capital shall no longer have rights and obligations towards private schools.

2. Individuals who have made contributions during the establishment and development of private schools, current members of the Board of Directors of private schools who have not contributed capital shall be prioritized to contribute capital to become shareholders of private schools.

3. Organizations applying to establish schools, individuals who have made contributions during the establishment and development of private schools, current members of the Board of Directors of private schools who previously contributed capital but have fully transferred their share of capital to other organizations or individuals shall not enjoy the priority right to contribute capital.

4. The Board of Directors of private schools, together with the Party Committee and Trade Union, shall resolve legitimate rights and benefits for individuals who have made contributions during the establishment and development of private schools.

Article 7. Determining the charter capital and raising additional charter capital for private universities

1. The charter capital of private schools when transitioning from private schools is the capital contributed initially and during the operation of private universities by organizations and individuals, after the Board of Directors of private schools decides on the method for maintaining the value of contributed capital as stipulated in Clause 1, Article 5 of this Circular.

2. The Board of Directors of private universities shall decide on recognizing the charter capital amount, the value of each share, and the number of shares of private schools when transitioning from private schools.

3. In cases where private schools need to increase capital contributions before determining the charter capital of private schools, the Board of Directors of private schools shall raise capital contributions in the following priority order:

a) The subjects specified in Article 6 of this Circular;

b) Those who have contributed capital;

c) Full-time faculty members of the school.

4. The specific value of capital contributions by the subjects specified in Clause 3 of this Article shall be determined by the Board of Directors of private schools.

Article 8. Determination of the Board of Directors for the first term of a private school

1. Members of the Board of Directors for the first term of a private school shall be determined in accordance with Clause 3 of Article 17 of the Higher Education Law and Articles 21 and 22 of the University Charter issued by Decision No. 70/2014/QĐ-TTg dated December 10, 2014 of the Prime Minister.

2. The Board of Directors of a public-founded school shall resolve to approve the number of members of the Board of Directors and the number of members representing the contributed capital of the private school.

Chapter III
PROCEDURES AND REQUIREMENTS FOR TRANSITION

Article 9. Documents for Transition

The documents for transition include:

1. A proposal for transitioning from a public-founded school to a private school signed by the Chairman of the Board of Directors of the public-founded school.

2. A resolution of the Board of Directors of the public-founded school on the matter of transitioning from a public-founded school to a private school.

3. A resolution of the Board of Directors of the public-founded school on:

a) Recognizing the list of organizations and individuals contributing capital, the method of preserving the value of contributed capital, determining the registered capital, the value of each share, and the number of shares;

b) Determining the number of members of the Board of Directors for the first term of the private school and the number of members representing the contributed capital;

c) The name of the private school after recognition of the transition (if necessary to change the school's name).

Resolutions of the Board of Directors of the public-founded school are adopted when more than 50% of the total number of members listed agree.

4. A draft charter for the organization and operation of the private school approved by the Board of Directors of the public-founded school.

5. An audit report and valuation results as prescribed in Article 4 of this Circular.

6. Documents related to land use rights.

7. Decision on establishment of the public-founded school; Decision on changing the name of the public-founded school (if applicable); Decision recognizing the incumbent Board of Directors of the public-founded school; Decision recognizing changes in members of the Board of Directors of the public-founded school (if applicable); Decision recognizing the incumbent Principal of the public-founded school.

Article 10. Procedures and Requirements for Transition

1. The Board of Directors of the public-founded school is responsible for submitting five sets of documents as stipulated in Article 9 of this Circular to the Ministry of Education and Training.

2. Within thirty working days from the date of receipt of valid documents, the Ministry of Education and Training will examine the transition project and submit it to the Prime Minister for a decision on the type of school conversion.

3. After the Prime Minister issues a decision recognizing the private school:

a) The Chairman of the Board of Directors of the public-founded school shall chair a meeting of capital contributors to elect representatives of capital contributors to the Board of Directors of the private school according to the number resolved by the Board of Directors of the public-founded school. The election mechanism for these members follows the cumulative voting system;

b) The Principal of the public-founded school shall chair a meeting of full-time faculty members of the public-founded school to elect representatives of full-time faculty members to the Board of Directors of the private school. The election mechanism at this point follows the principle of collective decision-making and majority voting;

c) The Party organization and mass organizations of the public-founded school shall chair elections to select representatives of the Party and mass organizations to the Board of Directors of the private school. The election mechanism for these members follows the regulations of the Party and mass organizations;

d) The Chairman of the Board of Directors of the public-founded school shall issue a letter requesting the People's Committee of the province or centrally-administered city (hereinafter referred to as the Provincial People's Committee) where the school is located to appoint representatives to join the Board of Directors of the private school;

đ) The Chairman of the Board of Directors of the public-founded school shall convene a meeting of elected and appointed members as specified in points a, b, c, and d of this clause to elect the Chairman of the Board of Directors of the private school;

e) The Chairman of the Board of Directors of the public-founded school shall issue a letter to the Provincial People's Committee requesting recognition of the Board of Directors of the private school;

g) After receiving the recognition decision from the Provincial People's Committee, the Board of Directors of the private school shall elect the Principal and issue a letter requesting the Provincial People's Committee to recognize the Principal of the private school;

h) If the person recognized as Principal is not already a member of the Board of Directors, they shall be added to the Board of Directors of the private school after being recognized as Principal; the addition of Board of Directors members must ensure that the number of members is odd.

4. The Chairman of the Board of Directors, Principal, and Chief Accountant of the public-founded school shall hand over to the Chairman of the Board of Directors, Principal, and Chief Accountant of the private school:

a) The transition documents as stipulated in Article 9 of this Circular;

b) A handover record of assets and funds established at the time of handover, along with the rights and obligations that the private school continues to fulfill.

Chapter IV
IMPLEMENTATION

Article 11. Responsibilities of agencies, organizations, and individuals during the process of converting public-private schools to private schools

Clause 1. The People's Committee of the province where the public-private school is located shall be responsible for supervising the conversion process of the schools and appointing representatives to participate in the Board of Directors of the private school.

Clause 2. The Board of Directors of the public-private school shall take the lead in implementing all activities of the school during the conversion process and dissolve itself until the Board of Directors of the private school is recognized by the competent authority.

Clause 3. The Principal of the public-private school shall manage the operations of the school according to their duties and powers until the Principal of the private school is recognized by the competent authority.

Clause 4. During the conversion process, if there are any difficulties, the school shall promptly report to the Ministry of Education and Training to receive guidance on handling.

Article 12. Effectiveness and responsibility for implementation

Clause 1. This Circular takes effect from February 1, 2015.

Clause 2. This Circular replaces Circular No. 20/2010/TT-BGDĐT dated July 16, 2010 of the Minister of Education and Training regarding the provisions on the content, procedures, and formalities for converting public-private universities to private universities.

Article 13. Responsibility for Implementation

The Director of the Office, Heads of the Planning and Finance Department, the Cadres and Civil Servants Department, Heads of relevant units under the Ministry of Education and Training, Chairmen of the People's Committees of the provinces where public-private universities are located, Chairmen of the Boards of Directors, Principals of public-private universities are responsible for implementing this Circular./.