City controls training organizations

Shanghai government has released a document on training organizations after several closed recently, to the fury of parents who had paid for classes for their children.

The city will launch an investigation to find out all training organizations and put them under supervision. It will work out specific standards on various organizations.

The educational authority will join with departments of human resources and social security, civil affairs, market supervision, culture and tourism, science and technology, and health to establish a comprehensive administration system. Blacklists and whitelists will be set up.

The document clearly defines responsibilities of different departments. Educational authorities should take the lead in administration and supervision on cultural and educational training organizations; human resources and social security departments should look over those providing vocational training; civil affairs departments are in charge of supervision on non-profit training organizations while market watchdogs should administrate those for profit.

It will also urge the organizations to set up capital management system or adopt third-party audit systems to regulate charging and refunding and secure safety of prepaid money. The educational and human resources and social security departments will work together with departments of market supervision, finance, tax and banking regulation to establish capital supervision schemes, exploring practices including performance guarantee insurance, third-party payment and single-use prepaid card to reduce risk of prepaid money.

It also urges training industrial associations to set up a third-party platform to handle students’ complaints and safeguard their rights.

To ensure stability of the training industry, the city will improve emergency mechanism for training organization to withdraw from the market and safeguard interests of all parties involved.