Commonwealth and Queensland legal reform of ESOS laws

17 August 2017

The Queensland State Government and the Federal Government have introduced Bills to their respective parliaments which, if passed, will affect schools that provide educational services to international students.

International education is a key contributor to the Australian economy with enrolments exceeding 700,000 in 2016, so legislative reform in this space is a reflection of the importance of protecting students by having a sufficiently regulated industry. In Queensland, the Education (Overseas Students) Bill 2017 (Qld) (EOS Bill) has been introduced to amend the Education (Overseas Students) Act 1996 (Qld) (EOS Act). While the Education Legislation Amendment (Provider Integrity and Other Measures) Bill 2017 (Cth) (the Bill), amending the Education Services for Overseas Students Act 2000 (Cth) (ESOS Act), was introduced to Federal Parliament.  This article discusses both Bills.

The National Code and the Qld position

Firstly, it is important to understand how the EOS Act and ESOS Act integrate together, and with the National Code of Practice for Providers of Education and Training to Overseas Students 2007 (National Code).  Basically, the EOS Act provides further regulation for Queensland schools, in addition to the compliance framework established by the Federal ESOS Act and National Code. However, the status of the National Code is unclear.    For more information refer to our previous School Governance Article.

Despite this uncertainty, the EOS Bill references the Interim National Code as part of the Federal legislative framework. This decision, while limited to Queensland, endorses that schools may regard the Interim National Code as the version of the Code to follow until the new National Code is released.

Overseas student changes in Queensland

As explained by the EOS Bill Explanatory Notes, there are currently 106 providers in Queensland (105 non-government schools and 1 for the government sector which covers 145 government schools) who are registered with the ESOS Agency to provide educational services to international students.  The Department of Education and Training (DET) in Queensland is the Agency responsible for approving the registration status of these schools.

The EOS Bill changes include:

  • a new regulatory regime to better reflect the role of the Director-General of the DET, better align the National framework (the ESOS Act and the National Code) and shared responsibility for compliance;
  • similar to Victoria and Tasmania, a statutory regime to regulate international secondary student exchange organisations that reflects the National Guidelines for the Operation of International Secondary Exchange Programs in Australia (National Guidelines); and
  • general updates to align with recent Queensland reform including the introduction of the new SATE system.

Administrative practices will be improved by introducing internal review rights within the DET and enhancing information sharing arrangements between registered providers and the DET.

The EOS Bill ensures better alignment with the Federal ESOS framework by:

  • aligning the criteria to be considered when deciding whether to approve a provider with the ESOS Act and National Code;
  • allowing the grant of provider approval for up to seven years as permitted under the ESOS Act;
  • removing the separate registration of courses; and
  • expanding the grounds for taking compliance action to align with the ESOS Act and national compliance regime.

The EOS Bill also removes the current requirement under the Queensland EOS Act for Queensland school providers of courses to overseas students to be registered on the Queensland register. Therefore, reducing red tape.

If the Bill is passed, the current EOS Act will be repealed and the new legislation will be called the Education (Overseas Students) Act 2017.

Changes to the Federal ESOS Act

The Federal Parliament has introduced changes to the ESOS Act through the Bill.  According to the Explanatory Memorandum the four major changes proposed that affect schools are:

  • strengthening the fit and proper person requirements for registered providers;
  • expanding notifiable disclosure events;
  • information sharing; and
  • amending late payment arrangements.

Interesting wording from the Explanatory Memorandum is the statement that the proposed changes to the ESOS Act are designed to protect students from "unscrupulous providers".

Strengthening the fit and proper person requirements

Additional measures have been put forward to determine whether a registered provider meets, or no longer meets, the fit and proper person for registration requirements under section 7A of the ESOS Act. The purpose of this is to ensure that “governing individuals” within education providers are fit to deliver educational services. Unfortunately, there is no clarification as to what “governing individuals” means.

These additional fit and proper person arrangements have been proposed to help preserve the integrity of the international education sector, protect international students’ interests and prevent unscrupulous behaviour from registered providers.

Expanding notifiable disclosure events

Notifiable disclosure events under section 17 of the ESOS Act are being expanded upon.  These additional disclosure events provide an extra level of reporting (as well as protection) against unprofessional behaviour occurring.  New paragraphs 17(1)(aa), (ba) and (da) will be added so registered providers must inform the Federal Department of Education and Training once they become aware that an associate or agent of the provider:

  • has been convicted of an offence against other laws of the Commonwealth, or against a law of a State, punishable by imprisonment for 2 years or longer, or a fine of 120 penalty units or more at any time during the last 5 years (paragraph 17(1)(aa));
  • has ever been approved to provide a program, service or activity on behalf of or with funding from the commonwealth or a state and has ever had their approval cancelled or suspended other than at the request of the associate or agent (paragraph 17(1)(ba)); or
  • if the associate or agent has ever been approved has ever had disciplinary, remedial or other compliance action taken in relation to the approval (paragraph 17(1)(da)).

The Bill also adds another layer of reporting by proposing to insert section 17A into the ESOS Act requiring providers to notify the Department of Education and Training of certain other events. Registered providers must report:

  • of the occurrence of any event that would significantly affect the provider’s ability to comply with the ESOS Act, within 10 business days after the event;
  • any prospective changes to ownership of the registered provider as soon as practicable before changes take effect; and
  • any prospective actual change in relation to a related person of the provider:
    • if the change cannot be determined until it takes effect – within 10 business days of the change taking effect; or
    • otherwise – as soon as practicable before the change takes effect.

Information sharing

This Bill will introduce a legal discretionary requirement for information sharing between registered providers and the ESOS agency.  This is so that accurate information in the international education sector is being provided to ensure registered providers remain compliant with their legislative requirements.  The insertion of section 175(1)(1A) allows the ESOS agency for a provider or registered provider, to give information obtained or received for the purposes of the ESOS Act to an enforcement body (within the meaning of the Privacy Act 1988 (Cth): such as the AFP, State or Territory Authority), if satisfied it is reasonably necessary for enforcement related activities.  Sharing information is still discretionary on the provider to demonstrate how they exercise the functions of their agents or providers.

What do schools need to know?

Every school around Australia who provides education services to international students would be familiar with the current federal and state or territory legislative framework.  Schools should have policies and procedures in place to ensure compliance with their legal obligations.  Although the Bill and EOS Bill are not yet law, it is important to understand how these pieces of legislation may affect how they provide services to international students. The finalisation of a new National Code later this year would also assist schools to comply with any reform coming their way.


William Kelly

William is a Legal Research Coordinator at CompliSpace. He assists with drafting and reviewing policies and procedures, as directed, for CompliSpace clients as well as writing regular articles for the School Governance blog. William is a lawyer and an officer of the Supreme Court of Victoria.