New regulations are likely to ban international agencies from providing education-exchange services in China, according to the Ministry of Education.
A recently published draft regulation allows provincial-level educational authorities to approve or reject qualifications of intermediary agencies, bans foreign agencies entering the market and strengthens supervision of the agencies.
The draft also requires agencies to build an emergency fund, supervised by educational authorities, so that clients can be refunded when the intermediary agencies cannot provide services.
The ministry has published the draft regulation on its website and is soliciting opinion at [email protected] until Nov 5.
According to Xinhua News Agency, the ministry said some unqualified agencies provide advisory services to people wishing to study abroad, and some help clients forge materials required for applications or cheat clients out of money.
In July, New Zealand immigration officials found 279 applications submitted by Chinese students contained some forms of fraud, and intermediary agencies were to blame for the fake materials.
"I think the ministry simply cut foreign agencies out without good reason. If foreign agencies can forge materials or cheat clients of money, domestic agencies can do that too," said Chen Naibo, who works for an intermediary agency based in the United States. Chen declined to give the name of his company.
Chen's company mainly provides consultant services to Chinese students who plan to attend high schools in the US.
"Since the students are too young to take care of themselves, most prefer living in a homestay, and we can find reliable homestays for them, which is much more difficult for agencies based in China," Chen said.
"Intermediary agencies win the trust of clients from good word of mouth. An agency, either domestic or foreign, can't survive a long time by cheating clients or forging materials," said a staff member of a Canadian agency, who refused to give her name because of the interview provisions of the company.
"I think the administrative intervention will not work effectively in the consulting market for overseas study," she said.
Zhao Kun, 20, a student from Beijing, was shocked when she found out about the new draft regulation.
"The draft regulation did not specify the extent, though. If Hong Kong-based companies are involved, I will be totally lost. It is so urgent that I don't have time to look for a new agent," she said.
Being busy preparing for the IELTS test, Zhao, who is planning to enter college in the United Kingdom in the spring of 2013, handed her application process to an education agent, Amber Education, a Hong Kong-based education-counseling firm.
"I hope it will not pass this term," she said.
However, domestic agencies gave the new regulation the thumbs up.
"It makes the industry more transparent and reliable, and reduces the risk," said a staff member of an education agent based in Beijing, who declined to give her name.
"If the companies are located on the Chinese mainland, students and parents can easily visit the companies to see the qualifications and environment, getting a feel for the company. However, if the companies are located overseas, it is not easy to judge their qualifications by looking at their websites and other non-face-to-face means of communication."
She explained that some unqualified agents on the Chinese mainland usually have overseas partners that help them run overseas businesses. However, the cost increases.
"Agents with qualification usually have connections with overseas schools, which may not need help from overseas partners," she added.