Headlines 09/10/2023 14:58 CH

The field of investment in establishing a foreign-invested Preschool education in Viet Nam

In order to help international investors understand and comprehend the conditions, procedures, and investment procedures for establishing a foreign-invested Preschool education in Vietnam. I - Lawyer Nguyen Trinh Duc - Director of IPIC Law Company Limited advise specifically as follows:

1. The field of investment in establishing a foreign-invested Preschool education in Viet Nam

Preschool education services with foreign investment are not committed in Vietnam’s service commitment schedule when participating in the World Trade Organization (WTO).  

However, the fact that Preschool is one of the types of educational institutions allowed to have foreign investment according to the regulations in Article 28 of Decree 86/2018 / ND-CP: Foreign investors are allowed to establish preschool with foreign investment without being restricted on the capital contribution ratio:

Article 28. The types of educational institutions with foreign investment

2.Preschool educational institution.”.

Thus, investors are allowed to establish kindergartens with foreign investment in Vietnam according to the regulations of Decree 86/2018 / ND-CP on foreign investment cooperation in the field of education.

2. The detail conditions for establishing a Preschool according to the laws in Vietnam

According to Decree 86/2018/ND-CP, Preschool with foreign investment are a conditional activity for foreign investors. Investors need to meet investment conditions as well as ensure the quality of education of educational institutions with foreign investment in Vietnam.

For the establishment of a preschool with foreign investment, foreign investors need to meet the following conditions:

  1. Name of preschool

- For schools, the name must include the constituent elements arranged in the order: “School”, “Grade or training level” and a unique name;

  1. Investment

- The investment project must have an investment rate of at least 30 million VND/child (excluding land use costs). The minimum total investment is calculated based on the time when the highest expected training scale is expected. The investment capital plan must be suitable for the expected scale of each stage.

- For foreign-invested educational institutions that do not build new facilities but only lease or have Vietnamese parties contribute with available physical facilities to implement activities, the minimum investment level must reach 70% of the above-mentioned level. That means the minimum investment is VND 21,000,000 / child.

  1. Investment location capital

- Schools and Kindergarten must be located in residential areas; ensuring regulations on safety and environmental sanitation

- The distance children have to travel to school is as follows: For cities, towns, industrial zones, resettlement areas, suburban areas, and rural areas, it should not exceed 1 km; for areas with particularly difficult socio-economic conditions, it should not exceed 2 km.

- The land area for school construction includes: construction area; playground area; greenery area, walkways..

  1. Infrastructure, facilities, and equipment

- The land area for school construction includes: construction area; playground area; greenery area, walkways. The average minimum land area for construction is 12 m2 per child for the plain and midland areas (excluding cities and towns); 8 m2 per child for city, town, high mountain and island areas.

- There should be classrooms, children’s bedrooms, and functional rooms that are suitable in terms of area, lighting, furniture, equipment, and utensils for child care and education;

- The school should have an office, a principal’s office, an administrative management room, a medical room, a security room, and a staff room that are suitable in terms of area, equipment, and utensils for management, care, nurturing, and education of children;

- The school should have a clean water system, a drainage system, suitable sanitation facilities, and sanitary equipment to ensure safety and cleanliness, meeting all the school’s activities;

- The school should have a kitchen organized according to a one-way operation process with suitable equipment and utensils, ensuring food safety and hygiene if the school organizes cooking for children;

- The school should have a playground, walls surrounding the school area, and a school gate with a school sign clearly stating the school’s name as regulated;

- The school area should have green trees. All construction designs and equipment, utensils, and toys of the school must ensure absolute safety for children.

  1. Structure of the construction block

* General requirements:

- The constructions must ensure the correct specifications in terms of design standards and current regulations on school hygiene..

- The arrangement of the facility needs to ensure independence between the group of children, kindergarten class with the service block; Ensure safety and educational requirements for each age group; Ensure emergency exits in case of incidents and fire prevention and fighting system.

- Ensure conditions for children with disabilities to access and use.

* The block of children’s group rooms and kindergarten classes

- The number of rooms for children’s groups and kindergarten classes is built corresponding to the number of groups and classes according to the ages of the school, nursery, ensuring each group, class has a separate room for nurturing, caring for, and educating children. The room for nurturing, caring for, and educating children includes:

+ Common activity room;

+ Bedroom;

+ Restroom;

+ Play veranda;

* The block of study service rooms

- Physical education room, art education room, or multi-purpose room.

* Dining organization block

- Kitchen area and warehouse

* Administrative management block

- School office;

- Principal’s office;

- Vice Principal’s office;

- Administrative management room;

- Medical room;

- Security room;

- Staff room;

- Sanitation area for teachers, staff, and employees;

- Parking area for teachers, staff, and employees;

* Garden block

- Playground for groups, classes; common playground; playground - green trees

  1. About the education program

- Preschool with foreign investment are organized for teaching:

+ The preschool education program in Vietnam is according to Vietnamese Law;

+ Preschool education programs of foreign countries;

- The education program implemented at kindergartens with foreign investment must reflect the educational objectives, not contain content that harms national defense, national security, community interests; does not propagate religion, distorts history; does not adversely affect Vietnamese culture, ethics, and customs, and must ensure the conditions for continuity between educational levels and training levels.

- In the case of Vietnamese children studying at kindergartens with foreign investment, the educational program at that kindergarten must include compulsory education and training content for learners who are Vietnamese citizens (The Minister of Education and Training stipulates compulsory education and training content for learners who are Vietnamese citizens studying in kindergartens with foreign investment).

  1. For receiving students

- Decree 86/2018/ND-CP, effective from August 1, 2018, opens up opportunities for kindergartens with foreign investment to enroll Vietnamese children under 5 years old. This is in line with the current wishes of Vietnamese parents who want their children to study in an international educational environment.

- Note: The number of Vietnamese children studying the foreign kindergarten program must be less than 50% of the total number of children studying the foreign education program at that kindergarten.

  1. About the staff

* Principal

- At a minimum, they must be trained to the standard level, which is having a college degree in preschool education or equivalent;

- They must have at least 5 years of continuous work in preschool education (In special cases due to job requirements, the person appointed or recognized as the Principal may have less working time in preschool education as prescribed).

- They must have completed a management training program;

- They must have credibility in terms of political qualities, ethics, lifestyle, expertise, and profession;

- They must have the ability to organize and manage the school, nursery, and be in good health;

* Vice Principal

- Having a college degree in preschool education or equivalent is a requirement;

- They must have at least 3 years of continuous work in preschool education. In special cases due to job requirements, the person appointed or recognized as the Vice Principal may have less working time in preschool education as prescribed.

- They must have credibility in terms of political qualities, ethics, lifestyle, expertise, and profession;

- They must have the ability to manage the school, nursery, and be in good health;

* Teacher and Staff

- Teachers must have at least a college degree or equivalent, with a field of study suitable for the subject they are assigned to teach;

- The standard training level for school health staff and accountants is having a college degree in the specialty they are assigned;

- For treasury staff, librarians, secretaries, cooks, and security guards, they must be trained in the profession they are assigned;

  1. About organizing classes

* Maximum number of children in one group/class

- Child of preschool

+ Children aged 03 - 12 months: 15 children/group;

+ Children aged 13 - 24 months: 20 children/group

+ Children aged 25 - 36 months: 25 children/group

- Kindergarten

+ Children aged 03 - 04 months: 25 children/group

+ Children aged 04 - 05 months: 30 children/group

+ Children aged 05 - 06 months: 35 children/group

* Number of teachers in one group/class

- For infants in the nursery: 5 children/teacher;

- For infants in the nursery: 10 - 12 children/teacher.

3. Procedure for implementing the procedure in Viet Nam

Step 1: Implementing the procedure for issuing an Investment Registration Certificate for an investment project;

Step 2: Implementing the procedure for issuing an Enterprise Registration Certificate.

Step 3: Implementing the procedure to apply for a Decision to allow the establishment of kindergartens with foreign investment;

Step 4: Implementing the procedure to apply for a Decision to allow the operation of kindergartens with foreign investment.

4. Documents and Dossiers for issuing an Investment Registration Certificate; an Enterprise Registration Certificate; a Decision to allow the establishment of kindergartens with foreign investment and a Decision to allow the operation of kindergartens with foreign investment according to Vietnamese Law

4.1 Documents and Dossiers for issuing an Investment Registration Certificate

  1. Documents that need to be written

- Application for project execution;

- Investment project proposal;

- Report on financial capability of investor;

- An explanation that meets the conditions for Foreign investment;

- Investor decision (for investment is organization);

- Power of attorney in case of authorization to a third party to perform the investment registration procedures.

  1. Documents provided by the investor

* General documents

- A certified copy of the Lease Contract or the Lease Agreement Principle for the project site. Attached to this document is a certified copy of the Investment Certificate/Business Registration Certificate of the leasing party, which is an organization (with real estate business); a certified copy of the Construction Permit; a certified copy of the Land Use Right Certificate (for leased houses);

* Specific documents for foreign organizations as investors

- Consular legalization of the Decision, Establishment License of foreign organizations and enterprises;

- Consular legalization of the audited financial statements for the last 2 years of the investor or confirmation of the bank account balance of the foreign investor to prove financial capability;

- Certified copy of the passport of the legal representative and the representative managing the contributed capital of the foreign investor.

* Specific documents for foreign individuals as investors

- Certified copy of the investor’s passport;

- Notarized translation of the Bank Account Balance Confirmation of the Investor to prove financial capability.

4.2 Documents and Dossiers for issuing an Enterprise Registration Certificate in Viet Nam

  1. Documents that need to be written:

- Enterprise Registration Application Form;

- The company’s charter;

- List of members (for Limited liability company with 2 or more members); List of founding shareholder (for Joint stock company);

- Decision of investment (for investment is organization);

- List of authorized representatives (for investment is organization);

- Power of attorney in case of authorizing a third party to represent to perform the enterprise registration procedure.

  1. Documents provided by the investor

* General documents

- Certified copy of the Investment Registration Certificate (Step 4.1);

- Certified copy of the identity Card or Passport of the legal representative of company expected establish.

* Specific documents for investment is organization

- Consular Legalization Decision, Establishment license of the organization, foreign enterprise (section b, step 4.1)

- Certified copy of the passport of the legal representative and the representative managing the contributed capital of the foreign investor (similar to item b, Step 4.1);;

* Specific documents for foreign individuals as investors;

- Certified copy of the passport of a member/shareholder contributing capital to establish an enterprise being a foreign investor (similar to item b, Step 4.1);.

4.3 Documents and Dossiers for issuing a Decision to allow the establishment of kindergartens with foreign investment

  1. Documents that need to be written

- Application for permission to establish an educational institution;

- Project to establish an educational institution;

- Plan for the infrastructure of the educational institution or the investment project to build infrastructure, including the explanatory part and detailed design of the educational institution.

  1. Documents provided by the investor

- Certified copy of the Investment Registration Certificate (Step 4.1);

- Certified copy of the Enterprise Registration Certificate (Step 4.2);

- The document of land allocation or land lease approval from the Provincial People’s Committee in cases where it is necessary to construct infrastructure (which clearly defines the address, area, and boundary markers of the land plot) and an agreement on the principle of leasing existing infrastructure;

- A certified copy of the bank account confirmation proving that the investor has contributed enough capital to establish the kindergarten.

4.4 Documents and Dossiers for issuing a Decision to allow the operation of kindergartens with foreign investment

  1. Documents that need to be written

- Education activity registration form;

- Curriculum, teaching plan, learning materials, list of textbooks and main reference materials;

- Admission target, admission regulations, and admission time;

- Training regulations;

- Regulations on tuition and related fees (school development fee, etc.);

- Regulations on testing, evaluation, and recognition of completed training programs (if any);

- The template of the diploma or certificate that will be used.

  1. Documents provided by the investor

-  A certified copy of the Establishment Approval Decision (Step 4.3);

- A Certified copy of the Investment Registration Certificate (Step 4.1);

- A Certified copy of the Enterprise Registration Certificate (Step 4.2);

- The expected training scale when establishing the School (total number of children, number of children by age);

- The independent audited financial report for the two consecutive years prior to the project establishment year, and the decision on capital allocation for project implementation by the investor (for corporate investors);

- A certified copy of the bank account confirmation proving that the investor has contributed enough capital to establish the kindergarten.

* Dossiers of staff:

- The list of the Principal, Vice Principal, heads of departments, accounting chief, teachers, staff, and the labor contracts signed between the School and each individual. Please note to attach the personal profiles of these individuals, which include:

+ A valid certified curriculum vitae/judicial record card issued by the competent authority of Vietnam and/or a document confirming that they are not a criminal or being prosecuted for criminal liability according to the regulations of foreign law issued by the competent authority of a foreign country (for foreign workers);

+ A certified copy of the legal ID card/Passport;

+ A health certificate issued abroad or issued in Vietnam according to the regulations of the Vietnam Ministry of Health;

+ A certified copy of relevant degrees, certificates (If issued by a foreign country, they must be consular legalized; translated into Vietnamese, the translation and the copy must be notarized according to the regulations of Vietnamese law);

+ A work permit issued by the competent authority of Vietnam (for foreign workers);

** Relevant legal documents according to Vietnamese Law

(1) Working Party On The Accession Of Viet Nam;

(2) Law on investment 2020;

(3) Law on enterprise 2020;

(4) Education Law 2019;

(5) Circular No. 52/2020/TT-BGDDT promulgating the charter of preschools;

(6) Decree No. 31/2021/ND-CP on Elaboration of some articles of the law on investment;

(7) Decree No. 01/2021/ND-CP on Enterprise registration;

(9) Decree No. 86/2018/ND-CP dated June 06, 2018 on foreign cooperation and investment in education;

(10) Other relevant legal documents.

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