Regulations of the People's Republic of China on Sino-foreign Cooperative Education (Revised in 2013)

Order of the State Council of the People's Republic of China No.638

July 18, 2013

(Promulgated in accordance with the Order of the State Council No.372 on March 1, 2003, and revised according to the Decision of the State Council on Abolishing and Revising Some Administrative Laws and Regulations under the Order of the State Council No.638 on July 18, 2013)

Chapter I General Provisions

Article 1 In order to regulate Sino-foreign cooperative educational activities, strengthen foreign exchanges and cooperation in the education field, and promote the development of educational facilities, these Regulations have been enacted in accordance with the Education Law of the People's Republic of China, the Vocational Education Law of the People's Republic of China and the Non-State Education Promotion Law of the People's Republic of China.

Article 2 These regulations shall govern the establishment of education institutions in China by foreign education institutions together with Chinese education institutions (hereinafter referred to as Sino-foreign education institutions) that aim to enrol mainly Chinese citizens (hereinafter referred to as Sino-foreign cooperative education institutions).

Article 3 Sino-foreign cooperative education is a public undertaking, and is part of the Chinese education system.
The state aims to promote and develop Sino-foreign cooperative education and open this field up to the outside world. Educational activities shall be standardized and administered in accordance with the law.
The state encourages Sino-foreign cooperative educational undertakings that result in the introduction of high-quality foreign educational resources. The state encourages Sino-foreign cooperative educational undertakings in the areas of higher education and occupational education, and encourages Chinese institutions of higher education to cooperate with reputed foreign institutions of higher education in running schools.

Article 4 The legitimate rights and interests of Sino-foreign education institutions and Sino-foreign cooperative education institutions shall be protected by Chinese law.
Sino-foreign cooperative education institutions shall, in accordance with relevant state preferential policies, be entitled to preferential treatment in accordance with the law, and shall carry out educational and teaching activities independently in accordance with the law.

Article 5 Sino-foreign cooperative educational undertakings must comply with Chinese laws, implement Chinese education policies, be operated in accordance with Chinese public ethical standards, and may not impair the sovereignty or security of the state or the public interest.
Sino-foreign cooperative education shall meet the developmental needs of Chinese education undertakings, guarantee the quality of education, and commit to foster a variety of talents for the socialist construction cause of China.

Article 6 Sino-foreign cooperative education institutions may enter into cooperative arrangements to launch education institutions of various types at various levels, but may not launch any institution responsible for delivering compulsory education or delivering education of a special nature, such as military or police training or political education.

Article 7 No foreign religious organization, institution, university, college or instructor shall engage in cooperative educational activities within China.
Sino-foreign cooperative education institutions shall not provide religious education or carry on religious activities.

Article 8 The administrative department of education under the State Council shall be responsible for the overall planning, general coordination and day-to-day administration of all Sino-foreign cooperative educational activities in China. The administrative departments of education and labor and other administrative departments under the State Council shall be responsible for relevant Sino-foreign cooperative educational activities within the scope of their respective responsibilities as provided for by the State Council.
The administrative departments of education of the people's governments of the provinces, autonomous regions, and municipalities directly under the Central Government shall be responsible for the overall planning, general coordination and day-to-day administration of Sino-foreign cooperative educational activities within their respective areas of administrative responsibility. The administrative departments of education and labor and other administrative departments of the people's governments of the provinces, autonomous regions, and municipalities directly under the Central Government shall be responsible for relevant Sino-foreign cooperative education activities within the scope of their respective duties and within their respective areas of administrative responsibility.

Chapter II Establishment

Article 9 Parties that apply to establish Sino-foreign cooperative education institutions shall have legal person status.

Article 10 Sino-foreign cooperative education institutions may be established using cash funds, physical property, land use rights, intellectual property rights and other forms of property as investment capital.
Intellectual property rights shall account for no more than one-third of the total value of assets invested in a Sino-foreign cooperative education institution. However, for any foreign education institution invited to engage in cooperative educational activities in China by the administrative department of education or labor under the State Council or by the people's government of any province, autonomous region, or municipality directly under the Central Government, intellectual property rights may account for more than one-third of the total investment made.

Article 11 All Sino-foreign cooperative education institutions shall meet the basic conditions set forth in the Education Law of the People's Republic of China, the Vocational Education Law of the People's Republic of China and the Higher Education Law of the People's Republic of China, and shall have legal person status. However, no Sino-foreign cooperative institute of higher education established by a foreign education institution and a Chinese institute of higher education shall be required to have legal person status.
Sino-foreign cooperative education institutions shall be established in accordance with state standards applicable to the establishment of other education institutions of the same level and type.

Article 12 Applications to establish Sino-foreign cooperative education institutions that will provide educational services at undergraduate level or above shall be subject to examination and approval by the State Council; applications to establish Sino-foreign cooperative education institutions that will provide high-level training and non-academic educational services shall be subject to examination and approval by the people's government of the province, autonomous region, or municipality directly under the Central Government where the institution is to be located.
Applications to establish Sino-foreign cooperative education institutions that will provide mid-level diploma education, distance learning courses, continuing education services or preschool education shall be subject to examination and approval by the administrative department of education under the people's government of the province, autonomous region, or municipality directly under the Central Government where the institution is to be located.
Applications to establish Sino-foreign cooperative education institutions that will provide occupational training shall be subject to examination and approval by the administrative department of labor under the people's government of the province, autonomous region, or municipality directly under the Central Government where the institution is to be located.

Article 13 The process for establishing a Sino-foreign cooperative education institution shall be divided into two steps, i.e., preparatory establishment and formal establishment, although any applicant that meets the criteria applicable to operating an education institution and the standards for establishment may apply directly for formal establishment.

Article 14 The following documents shall be submitted for any application to establish a Sino-foreign cooperative education institution:
1. An application form, the contents of which shall include: the names of the Sino -foreign education institutions and the Sino-foreign cooperative education institution to be established, its educational goals, the scale, level and type of education services to be provided, educational criteria, the internal management system to be established, the funding of the institution and the management and use of funds, etc.;
2. A cooperation agreement, the contents of which shall include the cooperation period and methods for the settlement of disputes, etc.;
3. The institution's source(s) of assets and total amount of funds available, and valid documentation demonstrating ownership thereof;
4. Where any assets have been donated, the relevant deed of gift shall be submitted, indicating the name of the donor, the amount of the gift, the purpose for which the gift is to be used and any applicable administrative arrangements, as well as valid, documentation demonstrating ownership thereof; and
5. Evidence demonstrating that initial funds of no less than 15% of the total investment to be made in the Sino-foreign cooperative education institution concerned have been paid in.

Article 15 With respect to any application for the preparatory establishment of a Sino-foreign cooperative education institution, the department responsible for examination and approval shall, within 45 business days of the date on which it receives the application, make a decision on whether or not to approve the application. Where approval is granted, a letter of approval for preparatory establishment shall be issued to the applicant; if not, the reasons shall be explained in writing.

Article 16 Any applicant that obtains approval for the preparatory establishment of a Sino-foreign cooperative education institution shall file an application for formal establishment within 3 years of the date of approval; where the 3-year period has expired, the Sino-foreign cooperative education institution shall be required to file a new application.
No students may be enrolled during the preparatory establishment period.

Article 17 The following documents shall be submitted for any application for formal establishment filed upon completion of the preparatory establishment tasks:
1. An application form for formal establishment;
2. A letter of approval for the preparatory establishment of the institution concerned;
3. A preparatory establishment report;
4. The articles of association for the Sino-foreign cooperative education institution and a list of the initial members of its council, board of directors or joint administrative committee, as appropriate;
5. Valid documentation demonstrating ownership of the Sino-foreign cooperative education institution's assets; and
6. The qualification certificates of the president or chief executive, teachers and finance personnel.
For any direct application for the formal establishment of a Sino-foreign cooperative education institution, the documents specified in Items 1, 4, 5, and 6 of the preceding paragraph, and in Items 2, 3 and 4 of Article 14, shall be submitted.

Article 18 With respect to any application for the formal establishment of a Sino-foreign cooperative education institution that will provide non-academic education services, the department responsible for examination and approval shall make a decision on whether or not to approve the application within 3 months of the date on which it receives the application; with respect to any application for the formal establishment of a Sino-foreign cooperative education institution that will provide undergraduate level or above education services, the department responsible for examination and approval shall make a decision on whether or not to approve the application within 6 months of the date on which it receives the application. Where approval is granted, a uniformly formatted and numbered Sino-foreign cooperative education license shall be issued to the applicant; if not, the reasons shall be explained in writing.
The format of a Sino-foreign cooperative education license shall be designed by the administrative department of education under the State Council, and the printing of licenses shall be organized by the administrative departments of education and labor under the State Council, according to their respective functions. Sino-foreign cooperative education licenses shall be uniformly numbered by the administrative department of education under the State Council, the specific measures for which shall be issued by the administrative department of education under the State Council in conjunction with the administrative department of labor under the State Council.

Article 19 With respect to any application for the formal establishment of a Sino-foreign cooperative education institution that will provide undergraduate level or above education services, the department responsible for examination and approval shall, after receiving the application, organize an expert committee to make enquiries, give its opinions and review the application.

Article 20 Any Sino-foreign cooperative education institution that obtains a Sino-foreign cooperative education license shall go through the appropriate registration procedure in accordance with relevant laws and administrative regulations, and the registration department shall handle the registration procedure in a timely manner in accordance with the relevant provisions.

Chapter III Organization and Administration

Article 21 Any Sino-foreign cooperative education institution with legal person status shall establish a council or board of directors; any Sino-foreign cooperative education institution without legal person status shall establish a joint administrative committee. Chinese members of the council, board or joint administrative committee shall make up no less than half of the total number of members.
The council, board or joint administrative committee shall be composed of no less than 5 individuals, and shall have 1 council chairperson and 1 deputy council chairperson, 1 board chairperson and 1 deputy board chairperson, or 1 director and 1 deputy director. Where one party to the Sino-foreign cooperative education assumes the council chairpersonship, board chairpersonship or directorship, the other party to the Sino-foreign cooperative education shall assume the deputy council chairpersonship, deputy board chairpersonship or deputy directorship.
The legal representative of any Sino-foreign cooperative education institution with legal person status shall be negotiated by the Sino-foreign education institutions concerned, and shall be either the council chairperson, the board chairperson or the president.

Article 22 The council, board or joint administrative committee of a Sino-foreign cooperative education institution shall be composed of the representatives of the Sino-foreign education institutions concerned, the president or chief executive, and teaching staff representatives, of whom no less than one-third of the members shall have 5 or more years' experience in education or teaching . A list of the names of the members of the council, board or joint administrative committee of a Sino-foreign cooperative education institution shall be submitted to the department responsible for examination and approval for its records.

Article 23 The council, board or joint administrative committee of a Sino-foreign cooperative education institution shall exercise the following powers:
1 The reelection or by-election of members of the council, board or joint administrative committee;
2. The retention or dismissal of the president or chief executive;
3. The modification of the articles of association and the formulation of systems and rules;
4. The drawing up of development plans and the approval of annual work plans;
5. The raising of education funds and the auditing of budgets and final accounts;
6. The determination of teaching staff numbers and salary levels;
7. Making decisions on any proposed dissolution, merger or termination of the Sino-foreign cooperative education institution; and
8. Any other powers provided in the articles of association.

Article 24 The council, board or joint administrative committee of a Sino-foreign cooperative education institution shall hold no less than one meeting each year. Interim meetings of the council, board or joint administrative committee may be held at the request of more than one-third of its members.
Any resolution on the following matters of major significance discussed by the council, board or joint administrative committee of a Sino-foreign cooperative education institution shall be adopted only with the consent of more than two-thirds of its members:
1. The retention or dismissal of the president or chief executive;
2. Any modification to the articles of association;
3. The formulation of development plans;
4. Any decision on a proposed dissolution, merger or termination of the Sino-foreign cooperative education institution; or
5. Any other matter of major significance specified in the articles of association.

Article 25 The president or chief executive of a Sino-foreign cooperative education institution shall be of Chinese nationality, reside within China, love this nation, conduct himself soundly and ethically, be well-educated, have teaching experience, and meet the required standards of professionalism.

Article 26 The president or chief executive appointed by a Sino-foreign cooperative education institution shall exercise the following powers:
1. The execution of decisions made by the council, board or joint administrative committee;
2. The implementation of development plans and the drafting of annual work plans, financial budgets, and systems and rules;
3. The retention or dismissal of staff members, and responsibility for rewards and disciplinary measures;
4. The organization of educational, teaching and scientific research activities, and guaranteeing the quality of education and teaching;
5. Dealing with day-to-day administrative work; and
6. Any other powers specified in the articles of association.

Article 27 Sino-foreign cooperative education institutions shall manage their teachers and students in accordance with the law.
Foreign national teachers and managers appointed by any Sino-foreign cooperative education institution shall hold a bachelor's degree or higher and corresponding professional qualifications, and shall have no less than 2 years' experience in education and teaching.
Foreign education institutions shall select a certain number of their teachers to teach in Sino-foreign cooperative education institutions.

Article 28 Sino-foreign cooperative education institutions shall safeguard the legitimate rights and interests of their teachers and students, guarantee the salaries and welfare benefits of their teaching staff, and meet the cost of social insurance for their teaching staff in accordance with the law.
The teaching faculties of Sino-foreign cooperative education institutions may form trade unions or other bodies in accordance with the law, and participate in the democratic administration of their respective institutions through teaching staff representative assemblies or otherwise.

Article 29 The foreign personnel of Sino-foreign cooperative education institutions shall observe the relevant provisions on the employment of foreigners in China.

Chapter IV Education and Teaching

Article 30 Sino-foreign cooperative education institutions shall offer courses such as constitutional studies, law, civic ethics and national studies, etc., in accordance with state requirements applicable to education institutions of the same level and type.
The state encourages Sino-foreign cooperative education institutions to introduce courses and use teaching materials that are currently lacking in China and are at an advanced level in other parts of the world.
Sino-foreign cooperative education institutions shall notify their respective examination and approval departments of the courses they offer and the teaching materials used for their records.

Article 31 Sino-foreign cooperative education institutions may, as and when required, use foreign languages when teaching; however, Mandarin and standard Chinese characters shall be used as the basic teaching language.

Article 32 Sino-foreign cooperative education institutions that offer courses at undergraduate level or above shall enroll students in accordance with the enrollment plan for state institutions of higher education. Sino-foreign cooperative education institutions that offer other academic courses shall enroll students in accordance with the provisions of the administrative department of education of the people's government of the relevant province, autonomous region, or municipality directly under the Central Government. The enrollment of overseas students by Sino-foreign cooperative institutions shall be carried out in accordance with relevant state provisions.

Article 33 Admission brochures and advertisements issued by Sino-foreign cooperative education institutions shall be provided to their respective examination and approval departments for their records.
Sino-foreign cooperative education institutions shall regularly publish the type and level of education courses they provide, the majors available, course contents, the number of students enrolled, and other relevant information.

Article 34 Sino-foreign cooperative education institutions that provide undergraduate-level courses shall issue diploma certificates or other educational certificates pursuant to the relevant provisions of the state; Sino-foreign cooperative education institutions that provide non-academic courses shall issue training certificates or course completion certificates pursuant to the relevant provisions of the state. Students who have received occupational training and have been appraised as qualified by occupational appraisal agencies approved by the government may be issued with the corresponding state occupational qualification certificates.
Sino-foreign cooperative education institutions that offer higher degree courses may issue corresponding Chinese degree certificates pursuant to the relevant provisions of the state.
Diploma and degree certificates of a foreign education institution issued by a Sino-foreign cooperative education institution shall be the same as those issued in the country in which the foreign institution is based, and shall be recognized by that country.
China's recognition of diploma and degree certificates of a foreign education institution issued by a Sino-foreign cooperative education institution shall be in line with international treaties concluded or entered into by the People's Republic of China, or be in line with the relevant provisions of the state.

Article 35 The administrative department of education under the State Council or the administrative departments of education and labor and other administrative departments of the people's governments of the provinces, autonomous regions, and municipalities directly under the Central Government shall strengthen the day-to-day supervision of Sino-foreign cooperative education institutions, organize or appoint social intermediary organizations to evaluate the operating standards of and quality of education offered by Sino-foreign cooperative education institutions, and publish the results of such evaluations.

Chapter V Assets and Finance

Article 36 Sino-foreign cooperative education institutions shall establish and develop financial and accounting systems and asset management systems in accordance with the law, and shall set up accounting books and records in accordance with the relevant provisions of the state.

Article 37 Throughout the period of time for which a Sino-foreign cooperative education institution exists, the legal person property rights to all of its assets shall be enjoyed by the Sino-foreign cooperative education institution in accordance with the law, and no other organization or individual may make any claim on those assets.

Article 38 Fees charged by a Sino-foreign cooperative education institution shall be fixed and publicized pursuant to the relevant government pricing provisions of the state; no additional fee may be charged and no fee increase may be implemented without first obtaining permission to do so. Sino-foreign cooperative education institutions shall calculate and collect tuition fees and other charges in CNYonly.

Article 39 Fees collected by Sino-foreign cooperative education institutions shall be used mainly for educational and teaching purposes and to improve educational facilities.

Article 40 Sino-foreign cooperative education institutions shall observe the foreign exchange control provisions of the state in receiving and paying out foreign currency and in the opening and use of foreign currency accounts.

Article 41 Sino-foreign cooperative education institutions shall publish their financial accounts at the end of each fiscal year, appoint social auditing agencies to audit their financial reports, publicize their audit results, and forward the relevant documents to the department responsible for examination and approval for its records.

Chapter VI Modification and Termination

Article 42 Any dissolution or merger of a Sino-foreign cooperative education institution shall, after the completion of liquidation procedures, be submitted by the council, board or joint administrative committee of the institution concerned to the relevant examination and approval department for approval.
With respect to an application for the dissolution or merger of a Sino-foreign cooperative education institution that offers non-academic education courses, the department responsible for examination and approval shall issue a written reply within 3 months of the date on which it receives the application; with respect to an application for the dissolution or merger of a Sino-foreign cooperative education institution that offers undergraduate-level courses, the department responsible for examination and approval shall issue a written reply within 6 months of the date on which it receives the application.

Article 43 Any proposed modification to an education institution that is a party to a Sino-foreign cooperative education institution shall be proposed by the education institution concerned, and shall, after liquidation procedures have been completed and the council, board or joint administrative committee has given its consent, be submitted to the department responsible for examination and approval for ratification, following which the relevant modification formalities shall be completed.
Any change of the premises or legal representatives of the Sino-foreign cooperative educational institutions shall be approved by the examination and approval authority and be subject to corresponding procedures. Change of the principals or major administrative officers of the Sino-foreign cooperative educational institutions shall be subject to procedures for changes in a timely manner.

Article 44 Any proposed change to the name, level or type of a Sino-foreign cooperative education institution shall be submitted by the council, board or joint administrative committee of the institution concerned to the examination and approval department for approval.
With respect to any application for the modification of a Sino-foreign cooperative education institution that offers non-academic education services, the department responsible for examination and approval shall issue a written reply within 3 months of the date on which it receives the application; with respect to any application for the modification of a Sino-foreign cooperative education institution that offers undergraduate-level or above education services, the department responsible for examination and approval shall issue a written reply within 6 months of the date on which it receives the application.

Article 45 A Sino-foreign cooperative education institution shall be wound up in any of the following circumstances:
1. Where the institution is required to be wound up in accordance with its articles of association and the department responsible for examination and approval has approved the winding up;
2. Where the institution loses its Sino-foreign cooperative education license;
3. Where the institution is unable to continue operating due to insolvency and the department responsible for examination and approval has approved the winding up.
In the event of any winding up, the Sino-foreign cooperative education institution concerned shall give fee refunds to the students enrolled as appropriate; the Sino-foreign cooperative education institution shall present a proposal on appropriate fee refunds to enrolled students at the same time as it files its application to be wound up.

Article 46 Any Sino-foreign cooperative education institution that is wound up shall be liquidated in accordance with the law. Where the Sino-foreign cooperative education institution files its own application to be wound up, it shall organize its own liquidation; where the institution is wound up by the department responsible for examination and approval in accordance with the law, the department concerned shall organize the liquidation; where the institution is wound up because of its inability to continue operating due to insolvency, it shall petition the people's court to organize the liquidation in accordance with the law.

Article 47 In the event of the liquidation of a Sino-foreign cooperative education institution, its debts shall be paid in the following order of priority:
1. Tuition fees and other fees to be refunded to students;
2. Salaries payable to teaching staff and social insurance premiums that are due and payable; and
3. Other debts that are due and payable.
Any assets of a Sino-foreign cooperative education institution that remain after the aforementioned debts have been paid off shall be disposed of in accordance with relevant laws and administrative regulations.

Article 48 Any Sino-foreign cooperative education institution the winding up of which is approved or that loses its Sino-foreign cooperative education license shall return its Sino-foreign cooperative education license and seal to the department responsible for examination and approval, and cancel its registration in accordance with the law.

Chapter VII Legal Liability

Article 49 Where the department responsible for examination and approval of a Sino-foreign cooperative education institution or any of its functionaries takes advantage of its/his position to receive any item of value or other benefit from any other person, abuses its/his powers or neglects its/his duties, issues a Sino-foreign cooperative education license to any applicant that does not meet the criteria set out in these Regulations, or fails to investigate and punish any illegal conduct out of which it becomes aware, thus resulting in serious consequences and violation of the criminal law, the person in charge directly responsible and any other person directly responsible shall be criminally prosecuted in accordance with the provisions of the criminal law relating to accepting bribes, abuse of power, neglect of duty or any other crime, as appropriate; administrative sanctions shall be imposed on any person whose conduct does not warrant criminal prosecution.

Article 50 Where any department, in violation of these Regulations, examines and approves a Sino-foreign cooperative education institution beyond the limits of its powers, the approval documentation it issues shall be invalidated and it shall be ordered to take remedial action by its immediately superior department, and administrative sanctions shall be imposed on the person in charge directly responsible and any other person directly responsible; where such action results in a serious loss of or serious damage to public property, or to the interests of the state or the general public, the offending parties shall be liable to criminal prosecution in accordance with the provisions of the criminal law relating to abuse of power or any other crime.

Article 51 Any person who, in violation of these Regulations, establishes a Sino-foreign cooperative education institution without approval, or obtains a Sino-foreign cooperative education license by fraudulent means, shall be banned by the administrative departments of education and labor according to their respective functions or in conjunction with the public security department, ordered to refund any fees collected from students, and fined up to CNY100,000; where any criminal offence is committed, the individual(s) responsible shall be criminally prosecuted in accordance with the law.

Article 52 Where any Sino-foreign cooperative education institution, in violation of these Regulations, enrolls students during the preparatory establishment period, the administrative departments of education and labor shall, according to their respective functions, order the institution concerned to stop enrolling students and return any fees collected to students, and fine it up to CNY100,000; where the circumstances are serious and the institution refuses to stop enrolling students, the department responsible for examination and approval shall withdraw its letter approving preparatory establishment.

Article 53 Where any Sino-foreign education institution makes a fictitious investment in a Sino-foreign cooperative education institution or diverts any investment therein after the institution is established, the administrative departments of education and labor shall, according to their respective functions, order the education institution concerned to take remedial action within a prescribed period of time; where the education institution concerned fails to do so, the administrative departments of education and labor shall, according to their respective functions, fine the institution up to 2 times the value of the fictitious or diverted investment.

Article 54 Any person who forges, modifies, buys or sells a Sino-foreign cooperative education license shall be criminally liable in accordance with the provisions of the criminal law relating to the forgery, modification, buying or selling of state department certificates, or any other relevant crime.

Article 55 Where a Sino-foreign cooperative education institution introduces new fees or raises its existing fees without approval, the administrative departments of education and labor shall, according to their respective functions, order the institution concerned to refund any additional fees collected, and the price control authority shall penalize the institution in accordance with relevant laws and administrative regulations.

Article 56 Where a Sino-foreign cooperative education institution is poorly managed and offers low-quality education and teaching, and thus has a negative influence, the administrative departments of education and labor shall, according to their respective functions, order the institution concerned to take remedial action within a prescribed period of time and shall issue an announcement thereon; where the circumstances are serious, or the institution concerned fails to take the remedial action required of it or fails to meet the required standards after taking remedial action, the administrative departments of education and labor shall, according to their respective functions, order the institution to stop enrolling students and revoke its Sino-foreign cooperative education license.

Article 57 Where any Sino-foreign cooperative education institution, in violation of these Regulations, issues a fraudulent admission brochure and uses it to obtain money or property, the administrative departments of education and labor shall, according to their respective functions, order the institution concerned to take remedial action within a prescribed period of time and issue it with a warning. Where the institution concerned has made any illegal gains, such gains shall be confiscated after any fees collected have been refunded, and the institution may be fined up to CNY100,000; where the circumstances are serious, the institution shall be ordered to stop enrolling students and have its Sino-foreign cooperative education license revoked; where the circumstances constitute criminal activity, the offending parties shall be liable to be criminally prosecuted in accordance with the provisions of the criminal law relating to fraud or any other crime. Any Sino-foreign cooperative education institution that issues a fraudulent admission advertisement shall be investigated for legal liability in accordance with the relevant provisions of the Advertising Law of the People's Republic of China.

Article 58 Where a Sino-foreign cooperative education institution has its Sino-foreign cooperative education license revoked, neither its council chairperson or board chairperson, nor the president or chief executive, may assume any such role within a Sino-foreign cooperative education institution for a period of 10 years from the date on which the Sino-foreign cooperative education license is revoked.
No person who is criminally prosecuted for any violation of these Regulations or of the criminal law shall be permitted to engage in Sino-foreign cooperative education activities for a period of 10 years from the date on which any criminal penalty is completed.

Chapter VIII Supplementary Provisions

Article 59 These Regulations shall apply to cooperative education activities undertaken by education institutions from the Hong Kong and Macao Special Administrative Regions, the Taiwan region, and Mainland China.

Article 60 Measures for the administration of for-profit Sino-foreign cooperative training institutions registered with the administrative department of industry and commerce shall be separately formulated by the State Council.

Article 61 Specific measures for the examination, approval and administration of cooperative education projects launched within China by foreign education institutions together with Chinese education institutions and that aim to enroll mainly Chinese citizens and provide undergraduate-level or above education services, distance learning education courses, continuing education, preschool education, etc., shall be formulated by the administrative department of education under the State Council.
Specific measures for the examination, approval and administration of cooperative education projects launched in China by foreign education institutions together with Chinese education institutions and that aim to enroll mainly Chinese citizens and provide occupational training courses shall be formulated by the administrative department of labor under the State Council.

Article 62 No foreign education institution or other foreign organization or individual shall be permitted to establish independently any school or other education institution within China that aims to enroll mainly Chinese citizens.

Article 63 Sino-foreign cooperative training institutions established prior to the implementation of these Regulations shall take any additional steps required to obtain a Sino-foreign cooperative training license as described herein. Any such institution that does not meet all the criteria specified in these Regulations shall ensure that it meets the relevant criteria within 2 years of the date on which these Regulations come into force; any institution that fails to meet the requirements set out in these Regulations within the prescribed period of time shall be wound up by the department responsible for examination and approval.

Article 64 These Regulations shall come into force on September 1, 2003.