CIRCULAR

PROVIDING FOR CONTENT, ORDER OF, AND PROCEDURES FOR THE TRANSFORMATION OF PEOPLE-FOUNDED UNIVERSITIES INTO PRIVATE ONES 

Pursuant to the Government’s Decree No. 178/2007/ND-CP dated December 03, 2007, defining the functions, tasks, powers and organizational structure of Ministries, Ministerial-level agencies; 

Pursuant to the Government’s Decree No. 32/2008/ND-CP dated March 19, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Education and Training;

Pursuant to the Government’s Decree No. 75/2006/ND-CP dated August 02, 2006, detailing and guiding implementation of a number of Articles of Law on Education;

Pursuant to the Government’s Decree No. 69/2008/ND-CP dated May 30, 2008, on incentive policies for the socialization of educational, vocational, healthcare, cultural, sports and environmental activities;

Pursuant to Decision No. 122/2006/QD-TTg dated May 29, 2006, of the Prime Minister, on the transformation of people-founded universities into private ones;

Pursuant to Decision No. 86/2000/QD-TTg dated July 18, 2000, of the Prime Minister, on issuing the regulation on people-founded universities;

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At the proposal of Director of Organization and Personnel Department;

The Minister of Education and Training provides contents, orders of, and procedures for the transformation of people-founded universities into private ones as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation and subjects of application

1. This Circular provides contents, orders of, procedures for and responsibility of organizations and individuals in the transformation of people-founded universities into private ones (hereinafter abbreviated to the transformation).

2. This Circular applies to people-founded universities defined in Article 1 of Decision No. 122/2006/QD-TTg dated May 29, 2006, of the Prime Minister, on the transformation of people-founded universities into private ones.

Article 2. Requirements of transformation

The transformation must comply with the principle defined in Article 3 of Decision No. 122/2006/QD-TTg of the Prime Minister, provisions on contents, dossier, orders, and procedures specified in this Circular and relevant legal normative documents.

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Article 3. Responsibilities of private universities after transformation

After transformation, private universities shall further perform legal commitments of people-founded universities with organizations, units and individuals involving debts, finance, assets, labor contracts, rights and obligations with respect to learners and construction and development of universities as already been committed in schemes for establishment of universities.

From time of transformation, private universities shall keep levels of tuition similar to ones provided by people-founded universities until ending a semester or ending a school-year. In next semester or school-year, universities shall provide for levels of tuition as prescribed by law and notify publicly in advance for learners.

Chapter II

CONTENT OF TRANSFORMATION

Article 4. Financial audit, inventory, classification, evaluation of assets and classification of capital sources

1. Time of financial audit, inventory, classification, evaluation of assets, and classification of capital sources shall be time of making last quarter or annual financial statements, be decided by Board of Directors of people-founded university, but not exceeding 01 year as from this Circular takes effect.

2. The financial audit, inventory, classification, evaluation of assets shall be performed in Vietnam dong, as prescribed by law, by an independent audit and evaluation company which has legal status.

3. People-founded universities shall compare the principal, value of available assets with accounting books at time of financial audit; make inventory, classify, evaluate assets and classify capital sources. To clarify reason of differences.

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a) The principal of initial contributions and contributions in the operation course of university from organizations and individuals;

b) The principal gained from donations or allocation from lawful financial sources;

c) The principal formed during operation of university;

d) The principal from loans, hired assets of domestic or foreign organizations and individuals.  

5. Compare the liabilities to determine total available capital and obligations for debts.

Article 5. Handling of the principal of people-founded universities when transforming into private ones

1. The principal part which is contributed by organizations and individuals and preserved value at time of contribution shall be converted into Vietnam dong at time of transformation on the basis of unified agreement between Board of Directors and members contributing capital and be turned into shares. An owner of shares (called as a shareholder) shall have right to draw his capital part or transfer it to other persons according to the following provisions:

a) Shareholder who wishes to transfer partly or entirely his contributed capital must transfer such capital part for the remaining shareholder firstly and at an agreement price at time of transfer.

b) He may transfer his contributed capital to persons other than shareholders of university only in case where shareholders of university fail to purchase or fail to purchase entirely.

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3. The principal from loans, hired assets of organizations, individuals shall comply with commitments and contracts of loaning, credit provision.

4. People-founded university shall hand over all area of land and assets on land which are being used enclosed with dossier to private one. Private university shall use land, assets on land in accordance with purpose and take responsibilities for use of land and assets on land. The course of transformation must be performed in accordance with current regulations on land management and use applied to educational facilities as prescribed by law on land.

Article 6. Rights of organizations sponsoring establishment of universities, individuals with merit in establishment and construction of people-founded universities and incumbent members of Board of Directors

1. Organization which has named on papers to act as sponsor for establishment of people-founded university shall have right to contribute capital with capital source not in the State budget to become shareholder of private university. If organization which has named on papers to act as sponsor for establishment of people-founded university fails to contribute capital, it shall have no longer right and obligation respect to private university.

2. Individuals with merit in establishment and construction of university and incumbent members of Board of Directors of people-founded university who have not yet contributed capital shall be entitled to contribute capital and become shareholder of private one.

3. Organizations sponsoring establishment of university, individuals with merit in establishment and construction of university and incumbent members of Board of Directors of people-founded university which have contributed capital but transferred their capital parts for other organizations and individuals shall be not enjoyed priority right to contribute capital, unless university has demand to call more capital when transforming to type of private one.

Article 7. Determining charter capital and mobilizing the initial share capital for private universities

1. Board of Directors of people-founded university shall decide scale and structure of charter capital of private university. Charter capital shall be not less than 50 billion VND.

2. If the principal which is contributed at the initial time and during the operational process of university from organizations and individuals is not enough for charter capital as prescribed at clause 1 of this Article, Board of Directors of people-founded university shall mobilize capital according to the priority order as follows: 

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b) Persons contributed capital;

c) Contractual lecturers, cadres of university.

3. If the principal which is contributed at the initial time and contributions during the operational process of university from organizations and individuals are equal to or more than charter capital as prescribed at clause 1 this Article and university has no demand to mobilize more capital, Board of Directors of people-founded university shall settle right to contribute capital of organizations sponsoring establishment of university, individuals with merit in establishment and construction of people-founded university and incumbent members of Board of Directors as prescribed in Article 6.

4. Board of Directors of people-founded university shall specify quantity and rate of contributed capital for subjects.

Article 8. Determination of Shareholders' Meeting

After determining capital sources of organizations and individuals contributing capital, Board of Directors of people-founded universities shall determine members of Shareholders' Meeting of private university as prescribed in Article 9 of Regulation on organization and operation of private universities promulgated together with Decision No. 61/2009/QD-TTg dated April 17, 2009, of the Prime Minister.

Chapter III

DOSSIERS, ORDERS OF, AND PROCEDURES FOR TRANSFORMATION  

Article 9. Dossier of transformation

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1. Report on transformation of people-founded university into private one signed by chairperson of Board of Directors of people-founded university.

2. Resolution of Board of Directors of people-founded university on transformation of people-founded university into private one.

3. Resolution of Board of Directors of people-founded university, regarding recognition of list of organizations and individuals contributing capital, determining charter capital, value of each share, quantity of shares.

4. List of shareholders that have right to vote and list of ordinary shareholders.

5. Scheme on transformation of people-founded university into private one with contents specified in Article s 4, 5, 6, 7 of this Circular.

6. Draft Regulation on organization and operation of private university which has been approved by the Shareholders' Meeting.

7. Minutes and result of electing Board of Directors and Control Board of private university made by the Shareholders' Meeting.

8. Report of financial audit, inventory of assets and dossiers involving land use right.

Article 10. Orders of and procedures for transformation

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2. Within 30 working days after receiving full and valid dossier, the Ministry of Education and Training shall consider the transformation scheme and submit it to the Prime Minister for issuing decision on transformation of university.

3. Based on result of electing Board of Directors of private university of the Shareholders’ Meeting, competent authorities shall consider and issue decision on recognition of Board of Directors of private university.

4. Board of Directors of private university shall conduct election of chairperson of Board of Directors, principal under regulations; submit to competent authorities for consideration and issuing decision on recognition.

5. Board of Directors, principal of private university shall receive handing from Board of Directors, principal of people-founded university and leaders of university according to Regulation on organization and operation of private university promulgated by the Prime Minister.  

a) Dossier of handing over includes:

- Dossier of transformation of people-founded university into private one.

- Financial statements at time of official transformation of people-founded university into private one.

- Decision on determining value of mutual owned capital part, not divided at time of official operation according to regulation of private university of competent agencies.

- Minutes on handing over assets, principal at time of handing enclosed with detailed report of debts handed to private university to continue inheriting and financial shortcomings which need to be handled further.

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- Board of Directors, chairperson of Board of Directors, principal, chief accountant and representatives of trade union organization of people-founded university shall be representatives of the deliverer.  

- Board of Directors, chairperson of Board of Directors, principal, chief accountant and representatives of trade union organization of private university shall be representatives of the receiver.  

c) Minutes of handing must have full signatures of members of handing and must clearly state:

- Status of available assets, principal, laborers at time of handing.

- Rights and obligations of private university in further inheritance.

- Shortcomings which private university is responsible for settlement.

Chapter IV

ORGANIZATION OF IMPLEMENTATION

Article 11. Supervision of transformation

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In the course of transformation, if there are problems, universities shall timely report to the Ministry of Education and Training for guide and handling.

Article 12. Effect and responsibility for implementation of Circular

This Circular takes effect on September 01, 2010.

The Chief of office, Director of Planning – Finance Department, Director of Organization and Personnel Department, heads of relevant units of the Ministry of Education and Training, chairpersons of the provincial/municipal People’s Committees where people-founded universities locate, chairpersons of Board of Directors and principals of people-founded universities, chairpersons of Board of Directors and principals of private universities shall implement this Circular.

THE MINISTER OF EDUCATION AND TRAINING




Pham Vu Luan