Article 53 The executive council or the board of directors of a privately-run school to be divided or merged into other schools shall, after financial settlement, apply to the examination and approval authority for approval.

Where a privately-run school applies for division or merging, the examination and approval authority shall, within three months form the date it receives the application, give a reply in writing; and where the application is made for the division or merging of a privately-run institution of higher education, the examination and approval authority may, within six months from the date it receives the application, likewise give a reply in writing.

Article 54 For alteration of the sponsor of a privately-run school, the matter shall be put forth by the sponsor and, after financial settlement and upon agreement by the executive council or the board of directors of the school, submitted to the examination and approval authority for verification and approval.

Article 55 For alteration of the name, level, or category of a privately-run school, the matter shall be submitted by the executive council or the board of directors of the school to the examination and approval authority for approval.

Where an application is made for the alteration of a privately-run school from one type to another, the examination and approval authority shall, within three months from the date it receives the application, give a reply in writing; and where the application is made for alteration to a privately-run institution of higher education, the examination and approval authority may, within six months from the date it receives the application, likewise give a reply in writing.

Article 56 Where a privately-run school is found in one of the following circumstances, it shall be terminated:

(1) it is required to be terminated according to the provisions of the articles of association of the school, and the termination is approved by the examination and approval authority;

(2) the license for running the school is revoked; or

(3) it cannot continue due to insolvency.

Article 57 When a privately-run school is to be terminated, it shall make proper arrangements for the students in school. When a privately-run school providing compulsory education is to be terminated, the examination and approval authority shall assist the school to make arrangements for the students to continue their studies.

Article 58 When a privately-run school is to be terminated, it shall make financial settlement according to law.

Where a privately-run school requests termination itself, it shall make arrangements for the settlement; where it is abolished by the examination and approval authority according to law, the settlement shall be arranged by the authority; and where it is terminated because it cannot continue due to insolvency, the settlement shall be arranged by the People’s Court.

Article 59 Property of a privately-run school shall be liquidated in the following order:

(1) tuition fees and extras and other expenses paid by educatees that should be returned;

(2) wages payable to the teachers and staff members and the social insurance premiums that should be paid; and

(3) other debts that should be cleared off.

The remaining property of a privately-run school after the debts mentioned above are cleared off shall be disposed of in accordance with the provisions of relevant laws and administrative regulations.