Provider default obligations

The following is a summary. For more information on provider default, view our Guide to provider default obligations under the ESOS Act.

Provider default occurs when a student has not withdrawn their enrolment and either:

  • the provider fails to start providing a course to an enrolled student on an agreed starting day, or
  • the provider stops providing a course to a student at a location any time after the course has begun, but before it has completed.

The most common causes of provider default are:

  • provider closure
  • failure to deliver a particular course.

The Education Services for Overseas Students 2000 (the ESOS Act) requires training providers to provide tuition assurance for overseas students for courses for which they have paid, and refunds where applicable.

Providers have certain obligations in situations where they default in relation to an overseas student, or intending overseas students. Registered providers also have obligations to report defaults, and the actions they take after defaulting, in relation to an overseas student.

Default exception notices

Sometimes a provider default may occur because of a change of legal entity.

In this situation, ASQA may issue a default exception notice under section 46A(4) of the ESOS Act. This default exception notice will allow you to continue providing your courses under the new legal entity title to overseas students who have already commenced.

Student obligations

If you default in respect of an overseas student or intending overseas student, within 14 days you must either:

  • place the student in an alternative course
  • refund the student.

For any overseas student who has paid tuition fees towards a course at a location, but has not yet commenced that course, you must refund 100 per cent of the tuition fees to the student.

For any overseas student who has paid tuition fees and has commenced the course at the location, you may retain the spent portion of the student’s fees, but must refund the unspent portion.

Reporting obligations

You have reporting obligations if you default in relation to a student.

You must lodge reports using the Provider Registration and International Student Management System (PRISMS), and provide:

  • detailed information about each overseas student affected by the default
  • evidence that you have provided students with tuition assurance or refunds.

You are also required to notify affected students of the default. This notification must be provided in writing and be in plain English.

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