Education has been identified as one of the services sectors for further growth and development in the 10th Malaysia Plan (10MP - 2011 to 2015)
The plan to develop education as a significant component of the services industry and to internationalise education as well as develop it as an export industry is reflected in the various liberalisation initiatives that have resulted in the proliferation of Private Higher Education Institutes (PHEIs).
The WTO classification for this sector covers :
- Primary education services
- Secondary education services
- Higher education services
- Adult education
- Other education services
The higher education services is driving the growth in this sector to position Malaysia as a leading destination for education.
What a service provider needs to know
As a service provider of this sector, you may be interested in the following :
- The relevant Acts that govern these services;
- The Regulatory agency/agencies;
- The liberalisation initiatives and specific service sector commitments that Malaysia has entered into.
- The Education Act 1996
- The Private Higher Educational Institutions Act 1996
- Universities and University Colleges Act 1971;
- The National Council on Higher Education Act 1996
- Educational Institutes Act (Discipline ) 1976
- The National Accreditation Board Act 1996 (LAN)
- The National Higher Education Fund Board Act 1997
These Acts provide the legal framework for
- the establishment of twinning programmes between foreign and local institutions;
- the establishment of private universities, branch campuses of foreign universities; and
- the upgrading of existing colleges to universities.
The Regulatory Bodies/Agencies
The following regulatory bodies are responsible for approvals as well as for monitoring curricula and overseeing the quality of each educational institute.
- The Ministry of Education (MOE);
- The Ministry of Higher Education (MOHE);
- The National Accreditation Board (LAN);
- The Malaysian Qualifying Agency (MQA);
Related associations are :
- The National Association of Private Education Institutions (NAPEI)
- The Malaysian Association of Private Colleges and Universities (MAPCU)
In 2012, foreign equity for international schools, technical and vocational schools (including for special needs) and private Universities is allowed up to 100 per cent, subject to approval from the Ministry of Education and/or the Ministry of Higher Education (MOHE).
Specific Service Commitments
Under GATS, commitments have been made for educational services other than for higher educational institutions allowing foreign equity not exceeding 49 per cent.
Under the 8th package of AFAS:
- in terms of market access, Mode Supply 3 (commercial presence) is allowed only through a joint venture with foreign equity not exceeding 51 per cent; and
- for Mode 4 (Presence of Natural Persons ), up to 10 lecturers are allowed for each privately funded higher education institution.
Under bilateral FTAs, Malaysia has made the commitments with Japan ( MJEPA ), Pakistan ( MPCEPA ), New Zealand (MNZFTA) and India (MICECA) for Other Higher Education Services privately funded. In this sub – sector, foreign equity is up to 49 per cent. The same applies for the regional FTAs with China ( ACFTA ), Australia – New Zealand ( AANZFTA ) and Korea ( AKFTA ).
There is an additional commitment under MNZFTA in the following sub – sectors:
- Primary education / General secondary education
- Technical and vocational secondary education
Currently, foreign equity not exceeding 51% is allowed but from December 2015, foreign equity not exceeding 70% will be allowed.
All commitments are subject to an economic needs test.
For further information, please contact: