In an unprecedented demonstration of transparency, the Ministry of Higher Education (MOHE) went on a roadshow in August to explain changes it proposes to make to the Private Higher Educational Institutions Act 1996 and to elicit public opinion on the proposed changes before they are implemented. The ministry even created a special website to facilitate public response to the changes.
This article examines the proposed changes to the definition of ‘branch campus’ the introduction of a new term, ‘foreign branch campus’ and other related changes. The other changes that are to be introduced will be examined in a number of future articles that will be published here.
For those new to private higher education in this country, the Private Higher Educational Institutions Act 1996 (the Act) is a comprehensive piece of legislation that deals with the establishment, registration and regulation of private higher educational institutions in the country. The term private higher educational institution as defined in the Act, embraces all types of higher education institutions, from colleges to universities, whatever their mode of delivery, traditional, online or by distance education. The Act also covers universities that are branches of foreign universities. These institutions are ‘private’ because by definition they are not established or maintained by the government.
Foreign Branch Campuses under the Act
The statutory procedures for establishing a branch campus of a foreign university in Malaysia are the same that apply to the establishment and registration of other private higher educational institutions. The company establishing the branch campus is subject to the same statutory provisions as companies establishing other types of institutions under the Act with respect to, for example, the composition of the board of directors and equity participation in the shareholding of the company. Similarly, once formed, the branch campus is bound by the same set of statutory provisions relating to registration, management, the delivery of educational programmes and the regulation of students that apply to all other higher education institutions established under the Act.
If the legal status of the branch campus of a foreign university established under the Act is indistinguishable from other institutions formed under the Act and it is bound by all the same regulations, there seems to be hardly any reason to describe it as a branch campus except perhaps to mark its origins. The branch campus of a foreign university in this country may have a foreign university as the owner whose name it will invariably carry. The fact and the law however, is that such universities, despite their name and possibly ownership, belong to a single category of educational institutions that are under the Act, known as private higher educational institutions.
The Act as it now stands, defines a ‘branch campus’ to mean a branch of a private higher educational institution with the status of a University or a University College and includes a branch of a foreign University or a University College, that is established under this Act. The term ‘branch’, on the other hand, means a branch of a private higher educational institution that is not a university.
The proposed new definition excludes the foreign branch campus from the definition of a branch campus. The amended section will read as;
Branch campus means a branch of a private higher educational institution with the status of a University or a University College excluding a foreign branch campus that is established under this Act.
A further amendment that is proposed, adds a new term, ‘foreign branch campus’, which reads as follows;
Foreign branch campus means a branch of a foreign University or University College that is established under this Act.
To incorporate the new definition of a foreign branch campus into the definition of private higher educational institution, an amendment is proposed to the latter term that reads;
“private higher educational institution” means an organization or educational institution, including a University or a University College or a foreign branch campus or a College . . .
The notes accompanying the proposed changes explain that the changes are intended to ‘clarify the definitions (of branch campus and foreign branch campus) in line with the amendments of section 18’ of the Act.
Section 18 as it is now framed requires the prior approval of the Minister before a private higher educational institution establishes a branch or affiliates, associates or collaborates with other higher educational institutions, whether private or public.
The amended section 18 retains the same prohibitions but is rephrased to read as follows;
18. (1) The prior approval of the Minister shall be obtained before;
(a) a University or University College or a college establishes a branch;
(b) a private higher educational institution or a branch affiliates, associates or collaborates with other higher educational institutions, whether public or private
The ministry’s explanation as stated in the circular is to ‘clarify that the approval for the establishment of branch (sic) is only for a University or University College established under this Act.’ The explanation itself is ambiguous, but if the aim of the amendment is to exclude foreign branch campuses from the restrictions of s.18, the proposed rephrasing of the section is unlikely to achieve the desired result. This is because any provision directed at a university will apply to all institutions falling within the definition of a university in the Act. The revised definition of a university in the proposals for change defines a ‘”University” or “University College” as a private higher educational institution conferred with the status of a University or University College under s.21.’ The foreign branch campus clearly satisfies that definition as its existence clearly falls under the provisions of s.21 of the Act.
It appears that the real purpose of the changes is to deny foreign branch campuses the right to establish branches in the country. However, even if that is the real intention, the amendments are unlikely to produce that effect.
The ministry’s notes do not explain the policy behind the intention to disallow foreign branch campuses establishing branches. As noted earlier, under the Act, a foreign branch campus is for all legal purposes, categorized as a private higher educational institution with the status of university; it should be treated in the same manner that the law treats all other universities formed under the Act.
 The related changes include amendments to the definition of private higher educational institution and a rephrasing of s.18 of the Act.
 Private Higher Educational Institutions Act 1996 s.2
 Private Higher Educational Institutions Act 1996 s. 21
 Only a registered company may apply to establish a private higher educational institution under the Act.
 The section has been criticised in the past because it is thought to be unnecessarily restrictive of the ordinary powers of higher educations. Whilst a case can be made for the establishment of branches, such control over affiliations, associations or collaborations has no real merit in it nor is there any evident danger from an institution that affiliates, associates or collaborates with other similar institutions. It is in the nature of universities and higher education institutions to affiliate, associate or collaborate with other institutions as part of their daily operations.