Decree 86, officially known as Decree 86/2018/ND-CP, is a key piece of legislation in Vietnam that regulates foreign investment in the education sector. It is an appurtenance to the Law on Education. Issued on June 6, 2018, this decree provides detailed guidelines on the establishment and operation of foreign-invested educational institutions and cooperation projects in Vietnam. It plays a crucial role in Vietnam’s broader effort to internationalise its education system while ensuring compliance with national educational standards and policies.
Scope and Applicability
Decree 86 applies to various types of foreign involvement in education, including:
- Foreign-invested preschools, primary, secondary, and high schools.
- International higher education institutions.
- Educational cooperation projects between Vietnamese and foreign educational institutions.
- Short-term foreign education programs and training centers operating in Vietnam.
Foreign Ownership Limits
Preschools and General Education (K-12): Foreign investors can fully own international schools that serve primarily non-Vietnamese students. However, for schools admitting Vietnamese students, the decree imposes limits on foreign ownership. At least 50% of the curriculum must be based on Vietnam’s national education framework.
Higher Education: Foreign-invested universities and colleges can be 100% foreign-owned, with more flexibility in terms of curriculum design and admissions policies.
Admission of Vietnamese Students
International Schools: Decree 86 outlines a cap on the number of Vietnamese students allowed to enrol in foreign-invested international schools:
- Preschool level: Maximum of 50% of the student population.
- Primary and Secondary levels: Maximum of 20% of the student population.
- The decree aims to balance the preservation of Vietnamese cultural and educational values while allowing Vietnamese students access to global standards of education.
Higher Education: No cap exists on the number of Vietnamese students attending foreign-invested universities, but certain subjects like Vietnamese history, geography, and culture must be included in the curriculum.
Curriculum Regulations
Vietnamese Curriculum: Vietnamese students attending foreign-invested schools must take Vietnamese language and cultural subjects in accordance with the Ministry of Education and Training (MOET) regulations.
Foreign Curricula: Foreign-invested schools are permitted to use internationally recognized curricula (such as IB, British, American, or other national systems), as long as they meet the local regulatory requirements for Vietnamese students. The curriculum for Vietnamese students must be approved by MOET.
Establishment and Licensing Procedures
Licensing Requirements: Foreign investors must obtain licences from relevant authorities to establish and operate educational institutions. This involves submitting detailed project proposals, demonstrating compliance with Vietnam’s national standards, and ensuring that facilities, teacher qualifications, and financial capacity meet the government’s regulations.
Capital Requirements: For higher education institutions, the minimum investment capital is set at VND 1,000 billion (about USD 43 million). For K-12 schools, the capital requirement varies depending on the size and scope of the project.
Box 1: Opening an English language centre in Vietnam
Vietnam’s booming economy has seen huge numbers of foreign firms enter the market and foreign tourists visit the country. This has created huge demand for English language courses and the proliferation of English language learning centres around the country.
Starting an English language centre in Vietnam however, can be tricky. There can be a lot of red tape and requirements and working with local authorities can be challenging. That said, firms and entrepreneurs can ease the stress and tension that comes with establishing an English language centre in Vietnam by understanding the process and its nuances ahead of time.
See: How to Start an English Centre in Vietnam: Ultimate Guide 2024
Teacher and Staff Requirements
Qualifications: Foreign teachers and staff working at foreign-invested institutions must meet certain qualification standards set by Vietnamese law. For example, foreign teachers must have a degree appropriate to the subject they are teaching and a recognized teaching qualification.
Language Proficiency: Vietnamese language proficiency is not mandatory for foreign teachers at international schools, but there are specific requirements for teachers instructing Vietnamese language or cultural subjects.
Partnerships and Cooperation Programs
Decree 86 encourages partnerships between foreign and domestic institutions, particularly in higher education. These partnerships can involve joint degree programs, research collaborations, and student exchanges.
Foreign educational institutions can establish representative offices in Vietnam to manage and promote cooperation with local institutions, as long as they do not directly engage in educational activities.
Quality Assurance and Accreditation
All foreign-invested schools and programs are subject to periodic inspections and must adhere to Vietnam’s national education standards.
International schools and universities are required to undergo accreditation processes to ensure the quality of education and alignment with global and local standards.
Impact of Decree 86
Decree 86 has had a substantial impact on Vietnam’s education landscape, particularly by facilitating the growth of international schools and universities. Some of its key effects include:
Increased Foreign Investment: By providing clearer regulations and reducing bureaucratic barriers, Decree 86 has encouraged more foreign investors to enter Vietnam’s education sector. The growth of international schools, especially in urban centres like Ho Chi Minh City and Hanoi, is evidence of this.
Rising Enrollment in International Schools: The decree’s provisions on admitting Vietnamese students to international schools have enabled more local families to access international education, leading to increased demand for bilingual and international programs.
Improved Global Integration: Decree 86 has supported the broader strategy of aligning Vietnam’s education system with global standards, making it easier for Vietnamese students to transition to foreign universities and participate in international academic programs.
Challenges and Criticisms
Despite the positive impact, Decree 86 also presents some challenges:
Limited Enrollment of Vietnamese Students
The cap on the number of Vietnamese students in international schools (especially at the primary and secondary levels) has been a point of criticism from parents and investors alike. Many Vietnamese families seeking international education find it difficult to secure places due to these limits.
Regulatory Complexity
Foreign investors often face complex administrative procedures to obtain the necessary licences, particularly for higher education institutions, where the capital and facility requirements are stringent.
Conclusion
Decree 86 is a landmark regulation that has helped shape Vietnam’s education industry by promoting foreign investment and encouraging international cooperation. In 2024, the decree continues to play a key role in driving the expansion of private and international education in Vietnam, while balancing the need to preserve national educational values.
Vietnam’s regulatory environment, however, is dynamic and can change quickly. With this in mind, to keep abreast of changes to said regulations, foreign firms operating in Vietnam should make sure to subscribe to the-shiv.