[Archive] Sudden close-down of private schools

Asked by : Hon YEUNG Yiu-chung

Replied by : SEM

Question :

Concerning the sudden closure of private schools, will the Government inform this Council of:

1. the avenues through which parents of the students of the Canadian Overseas International College, which closed down suddenly in October this year, can recover the tuition paid in advance; and whether it has investigated if financial difficulties were the genuine cause of the closure of the College; and
   
2. the measures it will take to avoid the recurrence of private schools closing down in the middle of an academic year because of financial difficulties, for instance, whether it will require the sponsoring bodies of the schools concerned to provide reliable financial guarantees such as bank guarantees, so as to protect the interests of students?
   

Reply:

Madam President,

1. To assist parents of students of former Canadian Overseas International College (COIC) to recover prepaid tuition fees, the Education Department (ED), upon receipt of the notification of the closure of the school, wrote to the supervisor of COIC immediately requesting refund of school fees. In addition, referral forms to the Consumer Council were distributed to parents concerned so that the Council could help them recover prepaid tuition fees. (ED passed 247 completed referral forms earlier to the Council for follow-up). If necessary, the Consumer Council would assist parents to recover prepaid tuition fees through the Small Claims Tribunal.
   
   The Police is investigating the case of the closure of COIC. The Police will, among other things, examine whether the closure of the school was due to financial difficulties.

2. Under the Education Regulations, schools (including private schools) are required to collect school fees by monthly instalments. This requirement considerably reduces the possible loss of tuition fees paid. We are now reviewing whether existing measures are sufficient to protect the interests of parents and students. The suggestion of bank guarantees will be considered in the review.