Education Goes International – An Indispensable guide to online education programs: United Kingdom

Statutory and Regulatory Framework

1.What laws regulate the provision of online education programs?

Pursuant to the Higher Education and Research Act 2017 (HERA), English higher education providers of foundation, bachelor’s and master’s degrees, and research degrees (such as PhDs) must be approved by the Office for Students (OfS). This requirement, however, only applies to higher education providers whose activities are carried on, or principally carried on (i.e., more than 50%), in England. A U.S. institution offering online programs in the UK would not fall within the purview of HERA, but the corollary is that the U.S. institution is not able to award UK-recognized degrees.

The provision of online education programs by U.S. institutions will, however, be subject to general consumer law, including the:

• Consumer Rights Act 2015;
• Consumer Protection from Unfair Trading Regulations 2008;
• Provision of Services Regulations 2009; and
• Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. A summary of these regulations is provided below.

Additionally, the UK Competition and Markets Authority has provided guidance on consumer protection law for higher education providers. Although this is aimed at providers based in the UK, the general principles under consumer law will also apply to online education programs aimed at students in the UK.

Please also see below regarding accreditation bodies and requirements for educational programs that lead to particular professions such as medicine and law.

Consumer Rights Act 2015 (CRA)

The CRA governs the supply of goods, services, and digital content to consumers in the UK. Online education programs are governed by the requirements that apply to digital content, which must be of satisfactory quality, fit for purpose, and as described. The CRA also governs remedies for non­compliance with the CRA and the use of unfair terms in consumer contracts.

Consumer Protection from Unfair Trading Regulations 2008 (CPR)

The CPR (as amended) prohibits certain types of unfair commercial practices (such as misleading and aggressive sales practices).

Provision of Services Regulations 2009 (PSR)

The PSR applies in part to businesses offering or providing services in the UK, such as U.S. institutions offering education services or programs remotely to students in the UK. In particular students must be provided with certain information (further described below).

Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the CCRs)

The CCRs regulate most contracts made between “traders” and “consumers” and govern the information to be provided by traders to consumers, as well as the key cancellation rights consumers are to benefit from. The information to be provided by the trader, and the cancellation rights the consumer is to benefit from, will depend on whether the contract is an “on-premises contract”, an “off-premises contract”, or a “distant contract”. If students enroll in courses or otherwise enter into a contract with a U.S. institution “at a distance” (e.g., online or by telephone) (under a “distant contract”), the U.S. institution will be obliged to provide certain information to the students, and the students will benefit from certain cancellation rights.

For distant contracts that are service contracts or a contract for the supply of digital content that is not supplied on a tangible medium, the normal cancellation period ends 14 days after the day on which the contract is entered into. Students would be able to cancel the contract within this cancellation period without giving any reason and without incurring any liability, except in limited circumstances.

For more detail on the information to be provided by the U.S. institution to students with respect to a distant contract, see below.

2.What agencies or entities regulate the provision of online education programs?

The OfS would regulate programs provided by UK institutions that are registered with the OfS. However, as discussed above, this requirement would not apply to U.S. institutions. There are no specific agencies or entities that regulate the provision of online programs by non-UK institutions to students in the UK.

If a U.S. institution providing online programs in the UK voluntarily seeks to be accredited by a UK accreditation body, however, it will need to meet certain standards to gain and maintain accreditation and will effectively be regulated by that particular accreditation body (see #4 below).

Please also see #11 below regarding regulatory bodies for courses that lead to certain professions (e.g., the SRA, GMC).

3.Is approval (e.g., authorization, registration, licensure) required for an institution to offer online education programs?

Other than voluntary accreditation (discussed below), we are not aware of any authorizations or approvals required for a non-UK institution to offer online programs in the UK.  These are likely to be regulated by applicable laws in the non-UK institution’s home country.

4.Is other action (e.g., in-country accreditation or reporting) required for an institution to offer and maintain online education programs?

QAA membership programme

The Quality Assurance Agency for Higher Education (QAA) is an independent body that monitors and safeguards the standards and quality of UK higher education. Universities, colleges and other education providers can choose to become a QAA member if they wish to do so. There is no requirement to become a QAA member but, one of the benefits of membership is that QAA members are provided with support to improve the quality and the standards of their services. QAA membership is, however, only available for higher education providers who are registered or established in the UK. A non-UK institution would therefore not be able to apply for QAA Membership (but see #6 below for information regarding partnerships with UK institutions).

This structure replaces the previous subscription model whereby publicly funded higher education institutions, non-publicly funded bodies holding degree awarding powers, and some further education colleges were required to subscribe to QAA.

Accreditation

A non-UK educational institution providing online education programs in the UK may also consider obtaining accreditation from recognized UK/EU bodies in order to demonstrate that the online programs they offer have undergone third-party assessment as to their quality and have, subsequently, had their quality verified in the UK. Such accreditation is voluntary and not mandatory under UK law, and would not entitle the non-UK institution to claim that it offers UK courses or degrees.

The bodies that provide accreditation to providers of higher education and/or online and distance education include (but are not limited to) the following:

British Accreditation Council (BAC) http://www.the-bac.org/

• BAC provides accreditation of private institutions offering further and higher education courses.
• BAC provides two international accreditation schemes for educational institutions based outside of the UK.
• Applicants will undergo a first-level scrutiny by BAC staff during the application review stage. Once this is complete, the applicant will receive an inspection. The report of the inspection will be considered by the Accreditation Committee, which will then decide whether to award, defer, or refuse accreditation.
• If the application form is completed in full and all relevant supporting documentation submitted at the time of application, it may be possible for the accreditation to be awarded in about 3-6 months.
• Applicants will have to pay an application fee of £2,450-3,050 and inspection fees, which vary depending on the particular accreditation scheme. Applicants may also have to pay further BAC fees depending on the circumstances (e.g. supplementary inspections and spot checks).
• If the application is successful, the organization will have to continue to pay an annual accreditation fee, which varies depending on the particular accreditation scheme and the number of students the organization has.

The Accreditation Service for International Schools, Colleges and Universities (ASIC) https://www.asicuk.com/

• ASIC provides accreditation of schools, colleges, universities, training organizations, and online and distance education providers, both in the UK and overseas.
• The application process for accreditation of international schools, colleges, and universities comprises a review of the application, an initial visit to the organization, and a final visit to the organization. Following the initial visit, the Accreditation Committee will consider the inspection report and either grant a 12-month interim accreditation, defer a decision, or refuse accreditation. Following the final visit, the Committee will grant full accreditation, defer a decision or refuse accreditation.
• The application fees for international institutions start at £5,000.
• If the application is successful, the organization will have to pay an annual fee, dependent on the size of the institution, of between £1,000 and £3,000.

EQUIS Accreditation from the European Foundation for Management Development (EFMD) https://www.efmdglobal.org/accreditations/business-schools/equis/

• EFMD provides accreditation of business schools and corporate universities internationally.
• The accreditation process typically takes 2–3 years and, in the most favorable circumstances, can be achieved in 15 months.
• The outcome of the accreditation process will be 5-year accreditation, 3-year accreditation or non-accreditation. If the organization wishes to continue to be accredited following the relevant 3- or 5-year period, it must apply for re-accreditation before the expiration of its accreditation period. The re-accreditation process does not take as long as the initial accreditation process.
• The total application fee for initial accreditation is €56,000 for 5-year accreditation, €49,000 for 3-year accreditation, and €38,500 for non-accreditation.

5.Are there other known criteria that an institution must meet to offer online education programs?

No.

6.Is the process different if an institution partners with an institution located in the foreign country to provide the online education programs?

A non-UK institution may enter into a partnership/franchise agreement to provide all or part of a degree program (foundation, bachelor’s, master’s, or doctorate) or other courses online to students in the UK on behalf of a lead provider that is authorized to award UK degrees to students in the UK, or whose degree programs are validated by an approved degree-awarding body. The UK partner would retain overall control of the program’s content, delivery, assessment, and quality assurance arrangements.

UK institutions with degree-awarding powers or offering degrees awarded by an authorized body must be registered with the OfS and can choose to subscribe to the QAA. The conditions of the partnership/franchise agreement would therefore need to comply with the QAA code with regard to ensuring that the services provided by a third party comply with QAA standards. The partnering UK institution may also have its own accreditation/registration requirements.

It is possible that, if a non-UK institution partners with a UK institution, the non-UK institution will be more likely to receive accreditation from the UK accreditation bodies it applies to. For example, BAC notes that many of the overseas institutions it has accredited had a link with a UK institution through a partnership, validation, or franchise agreement. We are, however, not aware of any formal link between partnering with a UK institution and receiving accreditation.

7.Does the law apply differently to an institution if the student is a resident of the foreign country, but not a citizen of the foreign country?

Consumer regulations as set out in #1 above will apply to both residents and citizens of the UK.

Curriculum

8.Will the foreign country recognize a certificate or degree earned by a student taking online education programs from a U.S. institution?

Only UK higher education providers can award foundation degrees, bachelor- and master-level degrees, and research awards (such as PhDs) that are recognized as UK degree qualifications. These institutions must first register with OfS and then apply for degree-awarding powers for specific subjects or all taught awards (known as recognized bodies). It is an offense punishable by fine for any organization to grant, or offer to grant, a degree qualification which may reasonably be taken to be that of a UK institution, unless authorized to do so.

Providers of full degree courses in the UK that do not have the power to award their own degrees can have their courses “validated” by a body that is authorized to award degrees, but these again must be based in the UK. Alternatively, a non-UK institution can act as a service provider for a UK higher education provider (pursuant to which the UK higher education provider has the relationship with students and is responsible for ensuring course content meets academic standards, but outsources certain elements of the course provision to the non-UK institution).

U.S. or other non-UK institutions may, however, offer their own degrees or certificates if they make it clear that they are not granting, or offering to grant, a degree qualification from a UK institution (i.e., these will be recognized as degrees/certificates granted by a U.S. university (or other non-UK university)).

Whether a non-UK degree/certificate will be recognized in the UK is largely left to individual higher education institutions (with respect to entry requirements) and employers, and is likely to depend on the institution’s reputation in the UK. Partnering with a university or other reputable UK higher education provider may provide an opportunity to build a presence in the UK.

Certain regulated professions may also have particular requirements for the recognition of programs provided by foreign higher education providers (see #11 below).

9.Are there any online education programs that (i) may NOT be offered by an institution; or (ii) require additional oversight from an appropriate foreign entity?

Education regulations do not impose any restrictions on the type of online programs that may be offered by a non-UK institution, nor does it require additional oversight from an appropriate entity in the UK (provided that the course is not being offered as a UK-recognized course).

10.Must the online education program’s curriculum be approved by an appropriate foreign entity?

If the non-UK institution delivers programs on behalf of a UK institution with powers to award UK degrees or whose degrees are validated by an authorized institution, the course program will need to be approved by the UK institution.

If the non-UK institution delivers non-UK credentials, the curriculum will not require approval by any entity or authority in the UK, although approval from a non-UK entity/authority may be required under the home-country laws of the non-UK institution.

11.Are there additional requirements for online education programs that lead to work in a professional field (e.g., nursing, teaching, law)?

Requirements for non-UK degrees or certificates delivered online that lead to work in professional fields will generally be regulated by the relevant regulatory body for the particular profession in the UK, and they will set out any additional requirements that must be met for the student to practice in that professional field.

For example, the recognition of foreign degrees or qualifications in Medicine, Teaching, and Law is regulated by the following regulatory bodies

Medicine

• The General Medical Council (the GMC) sets out the criteria a student with a foreign medical qualification must meet in order for them to be able to apply for full registration in the UK with a license to practice medicine.
• Courses delivered by a U.S. institution are likely to be considered to be foreign medical qualifications, unless the institution has partnered with an institution in the UK with powers to award degrees or whose degrees are validated by an authorized body.
• To be eligible for full registration, a student with a foreign medical qualification must: be a national of a country outside the UK, the EEA, or Switzerland who has graduated from medical school outside the UK; or a UK national who has graduated from a medical school outside the UK, the EEA, or Switzerland;
  • have passed both parts of the Professional and Linguistic Assessments Board (PLAB) test; and
  • have completed an internship or have practiced for two years continuously after graduation.
• Furthermore, for the foreign medical qualification to be an acceptable medical qualification, it must be in allopathic medicine and must satisfy the following criteria:
  • Be awarded after a program of study comprising at least 5,500 hours over a minimum period of years (which depends on the particular circumstances);
  • Be awarded by an institution listed on the World Directory of Medical Schools, except in limited circumstances; and
  • Have included clinical rotations that were of acceptable duration, included exposure to medicine and surgery, were overseen or approved by the institution attended, and formed part of the overall program of study.
• Courses provided as part of a medical degree awarded by a UK institution and other non-degree qualifications (such as Continuing Professional Development or “CPD”) must comply with the GMC’s standards for medical education in the UK.
• Additionally, CPD courses may be accredited on a voluntary basis by regulatory bodies for particular areas of medicine, such as the Royal College of General Practitioners.

Teaching

• Under the Education (Specified Work) (England) Regulations 2012/762 (the Education Regulations), persons are generally prohibited from carrying out specified work (i.e., teaching students) in a school (except private / independent schools, academies and free schools) unless they have Qualified Teacher Status (QTS).
• Only providers of initial teacher training (ITT) that have been accredited by the Department for Education (DfE) can provide courses that lead to a recommendation for QTS.
• In order for an ITT provider to become accredited, it will have to demonstrate in a proposal to DfE how its provision of ITT is likely to be ranked at least as “good” by Ofsted, the UK Government department responsible for inspecting educational institutions, and how it will meet the Secretary of State’s ITT criteria, which include entry, training, management and quality assurance, and employment based criteria.
• We could not find any clear guidance on whether a foreign institution providing teacher training courses in the UK could become accredited by the DfE. If a U.S. institution could become accredited as a provider of ITT, students that successfully completed its courses would be automatically recommended for QTS.
• If the U.S. institution is unable to become DfE-accredited, students will be treated as having been trained outside the UK.
• Under the Education Regulations, where a person has completed a professional training program for teachers in a country outside of the EEA and Switzerland (but not in Australia, Canada, New Zealand, or the U.S.) that is recognized by the competent authority in that country, that person is allowed to teach students in a school (other than under a pupil referral unit) for a period of up to four years. Following this, the person will need to apply for QTS to continue teaching.
• Since April 1, 2012, persons that have completed recognized professional training programs in Australia, Canada, New Zealand, or the U.S. can, however, apply for QTS without undertaking further training or assessment in England and are exempt from the four-year rule.
• Therefore, if the U.S. institution provides teacher training programs to students that are recognized in the U.S. by the relevant competent body, such students will then be able to apply for QTS to work in all schools in England without undertaking further training or assessment.
• The Teaching Regulation Agency oversees the process of foreign-qualified teachers applying for QTS to be able to teach in all schools in England.

Law

• Up until September 2021, in order to become a solicitor, students will need to undertake the Legal Practice Course (the LPC)..
• In order to become a barrister, students will need to undertake the Bar Professional Training Course (the BPTC).
• To be eligible to apply for the LPC or BPTC, a student must have either:
  • a qualifying law degree (QLD); or
  • a degree in any other subject, supplemented by:
    • the Common Professional Examination (the CPE); or
    • an approved Graduate Diploma in Law (GDL).
• In order for a law degree to be a QLD, it will need to meet certain criteria, including covering the seven foundation subjects specified by the Solicitor’s Regulation Authority (the SRA).
• Degrees from foreign institutions are not recognized as QLDs by the SRA. Students with law degrees from foreign institutions may, however, apply to the SRA for a Certificate of Academic Standing in order to avoid having to take the GDL and to be eligible for direct entry to the LPC or BPTC. If a student is not able to secure such a Certificate, they will have to apply for the GDL instead.
• Students with law degrees or non-law degrees from foreign institutions will only be eligible to apply for the GDL if the SRA assesses their degree to be equivalent to a degree awarded by a UK institution.
• It may be possible for a foreign institution to deliver the GDL, LPC, and/or BPTC through an online course.
• There does not appear to be any clear guidance from the SRA on how an institution applies to provide the GDL. Note, however, that the current list of authorized providers includes only one non-UK based institutions (the University of Law, Hong Kong).
• In order for an institution to provide a LPC, it must be authorized by the SRA to do so. Institutions seeking authorization must apply to the SRA and demonstrate that they meet specified criteria. The guidance on applying to be an SRA-authorized LPC provider does not explicitly preclude foreign institutions from providing LPCs through an online course. Note, however, that the current list of authorized providers only includes UK institutions.
• From September 2021 onwards, in order to become a solicitor, students will need to:
  • hold a degree or equivalent qualification (such as a degree apprenticeship) in any subject; and
  • pass stages 1 and 2 of the Solicitor’s Qualifying Exam (SQE), namely SQE1 and SQE2;
    • SQE1 will involve sitting exams in six foundation subjects, it must be passed in its entirely before SQE2 can be commenced;
    • SQE2 is made up of five practical legal skills assessments, which must be completed across two different practice contexts, making ten examinations overall.
• It is expected that some institutions will incorporate SQE1 preparation into their law programmes or provide separate SQE1 preparatory courses for non-law graduates.
• In order for an institution to provide a BPTC, it must apply for accreditation to do so by the Bar Standards Board (BSB) and demonstrate that it meets specified criteria. The applicant will have to put forward a proposal. If the proposal is considered to be satisfactory, the accreditation panel will arrange a visit and then in their panel report recommend a decision to the BSB. The guidance on applying for accreditation does not preclude foreign institutions providing BPTCs through online courses. Note, however, the current list of authorized providers only includes UK institutions.

12.Are there additional requirements if – in addition to primarily online sessions – some supplemental instruction takes place at a physical location in the foreign country?

As discussed above, HERA seeks to regulate “English higher education providers,” which are defined as institutions that provide higher education and whose activities are carried on, or principally carried on, in England. Provided that the supplemental instruction in England does not form all or principally all of the activities the non-UK institution carries on, the non-UK institution will still not fall within the purview of HERA.

The CRA governs the supply of goods, services, and digital content to consumers in the UK. If the contract between the non-UK institution and a student also provides for supplemental instruction to take place at a physical location in the UK, the contract will be governed by the requirements of the CRA that apply to services as well as those that apply to digital content.

These requirements provide that:

• the service must be performed with reasonable care and skill;
• the contract for the supply of the service will be treated as including as a term of the contract all information said or written to the consumer by the trader, provided it is taken into account by the consumer when entering into the contract or when making a decision about the service after entering into the contract;
• where the contract does not expressly fix the time for the service to be performed or state how it will be fixed, and the time is not fixed in any other way, the contract will be treated as including a term that the trader must perform the service within a reasonable time.

The CRA also governs remedies for consumers for breach of these requirements.

13.Are there additional requirements if a student participates in an on-the-ground internship, externship, practicum, or clinical in the foreign country to fulfill part of the online education program?

Similar to #12 above, if the contract between the non-UK institution and a student also provides for an internship, externship, practicum or clinical to take place in the UK, the contract will be governed by the requirements of the CRA that apply to services as well as those that apply to digital content.

14.Are there additional requirements if students take tests/assessments at testing centers or locations in the foreign country?

We are not aware of any general additional requirements that might arise where the student takes tests or assessments at locations in the UK.

Note, however, that in the UK, the standards for assessments and tests for courses that lead to work in professional fields will generally be regulated by the relevant regulatory body for the particular profession in the UK. For example:

• Medicine – The GMC is responsible for setting the standard of expertise that undergraduate medical students need to demonstrate at qualifying examinations or assessments. The GMC monitors that this standard is being complied with by appointing inspectors to review qualifying examinations and assessments and to report back to the GMC.
• Law – The SRA sets minimum standards for the assessment of students on LPCs, and each authorized LPC provider must have an assessment strategy that complies with these standards. In relation to the SQE, an institution (Kaplan) has already been confirmed as the assessment provider and it will pair up with Pearson VUE to utilise the latter’s network of test centres across England and Wales.

Marketing

15.Must an institution meet certain requirements before advertising its online education programs to students in the foreign country?

Advertising is regulated in the UK by a combination of legislation and self-regulatory codes of practice. The CPR requires that all claims and descriptions be accurate and not misleading. A claim will be deemed misleading if it causes or is likely to cause an “average” consumer to buy a product or service he/she would not have otherwise bought had accurate information been provided about that product/service. This can include a misleading omission of information, or information that is presented in an unclear or ambiguous way. The legislation also sets out a list of banned advertising practices that are considered unfair in all circumstances (i.e., without the requirement to consider the likely effect on the average consumer).

In addition, the institution is likely to be contractually bound by the marketing materials that it publishes. Any attempt to deviate from the advertised course details could either be unenforceable (e.g., if the institution attempts to impose fees that were not advertised) or constitute a breach of the contract with the student (e.g., if the course content does not meet the advertised description).

In the UK, advertising and marketing for consumer products and services is also self-regulated by two main industry codes of practice, both of which are enforced by the Advertising Standards Authority (ASA):

• the British Code of Advertising, Sales Promotion and Direct Marketing (the CAP Code), which applies to advertisements online and in other non-broadcast media (e.g., newspapers, magazines, posters, leaflets and brochures); and
• the Code on Broadcast Advertising (the BCAP Code), which applies to advertisements in broadcast media.

The ASA does not regulate marketing communications that originate from outside the UK or advertisements and promotions on non-UK websites (i.e., websites that do not have a “.co.uk” address), even if they are targeted at UK consumers. Instead, such advertisements and marketing communications will be subject to the rules of the relevant authority in the country from which they originated. Therefore, if a U.S. institution only advertises its online programs on U.S. websites and sends marketing communications from the U.S. rather than within the UK, it will not need to meet the requirements of the ASA Codes.

If the U.S. institution, however, engages in advertising and marketing activities for its online programs from the UK, such activities will need to comply with the Codes. The Codes reflect the requirements imposed by law (in particular the CPR) and provide additional rules and guidance in specific areas. The Code relating to non-broadcasting media does not contain specific rules with respect to advertisements for education and, as such, only the general rules will be applicable. In particular, marketing communications should be legal, decent, honest, and truthful. The BCAP Code does, however, contain some limited specific rules with respect to advertisements for education. In essence, these require that advertisements for training or educational opportunities must neither mislead the audience nor exploit the susceptibilities or credulity of those seeking work. For instance, such advertisements must not “exaggerate the resulting opportunities for work or remuneration”.

Furthermore, it should be noted that, under the Codes, a “child” is considered to be anybody under the age of 16. Therefore, if advertisements are targeted at individuals less than 16 years old, the U.S. institution will also need to comply with the child-specific rules.

As indicated above, a foreign institution must not market a course as being UK recognized unless it has been validated by an appropriate UK institution.

16.Does the foreign country require an institution’s website or online portal to contain certain information?

Under Part 2 of the PSR, service providers (including providers of online education programs) are required to supply certain information to the recipients of their services, including:

• the business name, legal status, and legal form of the service provider;
• contact details (including the telephone number, postal address, fax number, or email address);
• geographic address where service provider is established;
• contact details for the purposes of rapid and direct communication;
• name and registered number of any trade association it is a member of;
• particulars of any relevant regulatory authority or professional body;
• VAT number (if available);
• general terms and conditions, including governing jurisdiction or law clauses, and after-sale guarantees (if applicable);
• the price and main features of the service;
• details of any professional indemnity insurance or guarantee (including name and contact details of insurer or guarantor and the territorial coverage of the insurance or guarantee); and
• details of any applicable non-judicial dispute resolution procedure that the service provider is subject to.

In addition, under Part 2 and Schedule 2 of the CCR, if students enroll in the courses or otherwise enter into a contract with the non-UK institution “at a distance” (e.g., online or by telephone), the institution must make available certain additional information prior to conclusion of the contract, including (but not limited to) the following:

• the total price of the services, inclusive of taxes or means or calculation of the price;
• the cost of using the means of distance communication for the conclusion of the contract where that cost is calculated other than at the basic rate;
• the arrangements for payment, performance, and time of performance of the services;
• the supplier’s complaint-handling policy;
• information on rights to cancel;
• in a clear and prominent manner and directly before the student places an order, the fact that the student must pay for the services (as well as certain other information).

As a result of the ongoing pandemic, the director of regulation at the OfS wrote to institutions at the beginning of this year asking them to undertake a review of their compliance with consumer law. As part of their review, institutions were advised to “re-test” whether they were “sufficiently clear with new and continuing students about how teaching and assessment would be delivered in 2020-21, the circumstances in which changes might be made, and what those changes might entail”. The letter requests that such reviews be carried out “during the first half of the spring term”. In the event that a review “identifies potential compliance risks”, institutions are requested to inform the OfS of such risks.

17.What are the requirements, if any, for marketing that is solely online (e.g., through websites or apps)?

There are no specific requirements for marketing conducted solely online.

As discussed above, if the non-UK institution engages in marketing activities that originate outside the UK only (e.g., in the non-UK institution’s home country), ASA will not regulate these activities. Requirements under the CPR relating to misleading and aggressive sales practices, however, will apply.

If the non-UK institution engages in marketing activities that originate from within the UK, ASA will regulate these activities, and ASA will be obliged to comply with the Codes as set out above.

18.If an institution wants to market through other means – like direct mailing, or email, or telephone calls – what requirements apply?

As discussed above, if the non-UK institution engages in marketing activities that originate outside the UK only, the ASA will not regulate these activities. Requirements under the CPR relating to misleading and aggressive sales practices, however, will apply.

If the non-UK institution engages in marketing activities that originate from within the UK, ASA will regulate these activities, and ASA will be obliged to comply with the Codes as set out above.

Additionally, if the non-UK institution has an establishment in the UK, the Privacy and Electronic Communications (EC Directive) Regulations 2003 (the PECR) will apply. PECR imposes specific requirements with respect to electronic communications such as marketing calls, emails, and texts.

In particular, under the PECR, unsolicited emails may not be sent to individual subscribers for the purposes of direct marketing except where the recipient of the emails has provided consent to the sender sending such emails or where:

• the sender has obtained the contact details of the recipient of the email in the course of the sale or negotiations for the sale of a product or service to that recipient;
• the direct marketing is with respect to that person’s similar products and services only; and
• the recipient has been given a simple and free means of refusing the use of their contact details for the purposes of such direct marketing, at the time that the details were initially collected and at the time of each subsequent communication.

Furthermore, the PECR prohibits the sending of emails for the purposes of direct marketing where:

• the identity of the person on whose behalf the communication has been sent has been disguised or concealed; or
• where a valid address to which the recipient of the communication may send a request that such communications cease has not been provided.

Please also refer to the data privacy requirements with respect to processing of personal data for marketing purposes and requirements for consent under the UK GDPR. See #22-23 for a general overview of the UK GDPR.

19.Can an institution send representatives to the foreign country to speak with students about the institution and its online education program offerings?

All marketing activities carried out by non-UK institution representatives in person in the UK will be subject to the general requirements on marketing in the UK and the requirements of the CAP Code as described above. Other than general consumer protection rules, there are no specific restrictions on the marketing of the programs by non-UK institution representatives in person.

However, immigration rules will apply in relation to individuals’ ability to enter the UK and the duration of their stay. These requirements will depend upon the nationality of the individual.

Admission & enrollment

20.What minimum qualifications must a prospective student have in order to be eligible to apply to and take an online education program from an institution?

There are no mandatory minimum entry requirements that a student must fulfill to apply to a foreign institution and take an online program.

In the UK, higher education institutions such as universities and colleges set their own entry requirements for higher education courses. Most higher education providers will have entry requirements in terms of qualifications – which will usually be A-Levels or equivalent-level qualifications – and in terms of grades. Many UK universities also specify a minimum age requirement as well, which is commonly set at 18 years old.

21.Must an institution enter into a written enrollment agreement with a prospective student for online education programs?

As explained above, the institution must provide students with the general terms and conditions for the services provided, including governing jurisdiction or law provisions, and after-sale guarantees (if applicable), prior to students enrolling in the course and paying for any fees. The CPR also requires certain information to be provided (e.g., through the terms and conditions) prior to conclusion of the contract with the consumer.

The terms of enrollment will be subject to the CRA, which prohibits the use of unfair terms in consumer contracts. Terms will be considered ‘unfair’ if they are deemed contrary to good faith and cause a significant imbalance to the detriment of the consumer. Any terms considered unfair will not be binding on the consumer. The CRA also prohibits the use of specific terms in all circumstances including:

• any exclusion or restriction of liability for death or personal injury caused by negligence;
• any exclusion or limitation of liability for breach of implied terms for digital content (including that digital content is of satisfactory quality, fit for particular purpose, and as described); and
• any exclusion of statutory and common law remedies for breach of implied terms.

We are not aware of any specific requirements or restrictions that would apply to the terms of an agreement for enrollment in an online program.

Data privacy

22.What data privacy laws, if any, would apply to an institution that may hold academic records, personally identifiable information, and financial information of students or prospective students?

The primary source of legislation in this area in the UK is the UK General Data Protection Regulation (UK GDPR), which is supplemented by the Data Protection Act 2018 (DPA).

The UK GDPR applies if the U.S. institution processes personal data through an establishment in the UK, or if it does not have an establishment in the UK, if it offers educational services to individuals in the UK, or monitors the behavior of individuals in the UK.

For example, amongst a number of other compliance obligations, the U.S. institution processing personal data must implement appropriate technical and organizational measures to ensure a level of security appropriate to the risk. It also must provide data subjects with a privacy notice disclosing certain information required by Articles 13 and 14 of the UK GDPR, including information about the transfer of personal data to a third country, such as the U.S., which has not been deemed by the regulatory authorities to ensure an adequate level of protection. Some additional requirements include: putting in place GDPR-compliant data processing agreements with vendors engaged in the processing of UK personal data on behalf of the U.S. institution; maintaining records of data processing activities; and responding to data subject rights requests.

Noncompliance with UK GDPR can result in maximum penalties of 4% of global annual revenue or £17.5 million, whichever is higher.

23.Specifically, are there any requirements related to student consent or breach notification?

Yes. Under the UK GDPR, the U.S. institution must inform the student of the purpose and legal basis for processing the personal data. While the U.S. institution may rely on one or more legal bases other than consent under the UK GDPR, the legal basis in some cases will be consent when processing certain sensitive categories of personal data.** 

The U.S. institution must notify the appropriate supervisory authority of a personal data breach within 72 hours of becoming aware of the breach, where feasible, unless the breach is unlikely to result in a risk to the rights and freedoms of natural persons. In some circumstances, the U.S. institution also must notify the affected data subjects of the breach. The UK GDPR defines a “personal data breach” broadly to include any breach of security that leads to the accidental or unlawful destruction, loss, alteration, unauthorized disclosure of, or access to, personal data. This definition is more expansive than U.S. breach notification laws, which typically focus on “access” or “acquisition” of a limited set of sensitive data elements in combination with an individual’s name.

**Article 9 of the UK GDPR defines these “special categories” includes personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs, or trade union membership, as well as genetic data, biometric data processed for the purpose of uniquely identifying a natural person, data concerning an individual’s health, and data concerning a natural person’s sex life or sexual orientation. Processing such data is subject to certain restrictions and may in some cases require the express consent of data subjects. In addition, Article 10 imposes strict restrictions on the processing of data relating to criminal convictions and offences; these restrictions vary across countries.

Taxes

24.Would the tuition revenue stream to the institution trigger any tax obligations in the foreign country, as it relates to the institution itself?

Corporation tax – The U.S. institution will only be subject to UK corporation tax in relation to its online education programs to the extent that the profits are attributable to a UK permanent establishment (PE). A UK PE broadly means:

• a fixed place of business in the UK through which the U.S. institution’s business is carried on (“business” excludes activities of a preparatory or auxiliary character, such as business development or marketing); or
• a dependent agent acting on behalf of the U.S. institution, which has and habitually exercises in the UK an authority to conclude contracts that are binding on the U.S. institution.

Based on the Program Assumptions, we would not expect the proposed services to result in the U.S. institution having a UK PE.

For discussion of VAT, see #25 below.

25.Are there any tax obligations related to the tuition paid by a student for online education programs?

The proposed services will only be subject to UK VAT if both: (i) their place of supply is in the UK; and (ii) the services are not exempt

Broadly, if the online courses (i) include content delivered by a teacher using a remote link (e.g., live individual or group tutoring, or other human involvement in teaching and marking); and (ii) are provided to UK non-business customers, then their place of supply will be outside the UK, and UK VAT will not apply.

However, if the online courses are either (i) solely automated (e.g., consisting only of pre-recorded videos and PDFs, with automated marking); or (ii) are supplied to UK business customers (e.g., providing access to their employees), their place of supply will be in the UK. Whether or not UK VAT is chargeable will then depend on whether the services in question are exempt.

Even if the services are supplied in the UK, UK VAT will not apply if the University is an “eligible body” which provides “education”. A U.S. institution will be an “eligible body” if it: (i) is precluded from distributing and does not distribute any profits it makes; and (ii) applies any profits made from supplies of education or the continuance or improvement of such supplies. There will be a supply of “education” if there is one-to-one tuition or similar. It is not sufficient to simply provide access to a website.

If the place of supply is the UK, and the U.S. institution is not an “eligible body” which provides “education”, UK VAT at 20% will be chargeable on the services. Where the supply is to a business customer, such VAT will be accounted for by the business customer under what is known as the reverse charge mechanism. However, where the supply is to a non-business customer, the U.S. institution will be liable to account for the VAT due.

• What if the U.S. institution is liable to account for UK VAT?

If the U.S. institution is liable to account for UK VAT, it will need to register for VAT with the UK tax authority, HM Revenue and Customs (HMRC). The U.S. institution would charge the customer VAT in addition to the price (which should be expressed to be VAT-exclusive), and then the U.S. institution would account for such VAT (less any UK VAT it has incurred on supplies it has received) to HMRC. The U.S. institution would also need to submit a quarterly VAT return. VAT compliance can be outsourced to a third party service provider.

Other

26.Is there any risk that in-country authorities could block access to the U.S. institution’s website?

Generally, the UK authorities do not restrict access to websites, except in very limited circumstances.

27.Is there anything else an institution should know about offering online education programs in the foreign country?

No.