VET

SECTOR
The Official Magazine from
COMPLIANCE AND QUALITY ASSURANCE (CAQA)

29th Edition
THE VET SECTOR | CAQA - Compliance & Quality Assurance

Change of Registered Training Organisation Ownership

What is required?

I n this ever changing world, we are seeing many RTO’s change ownership for a
variety of reasons. So, what is involved? How do you know you are ready and prepared?
What evidence do you need?

Anyone involved in the transfer of ownership

of registered training organisations (RTOs)
and Commonwealth Register of Institutions
and Courses for Overseas Students (CRICOS)
is subject to a number of requirements.

It is not permitted for RTOs and CRICOS

providers to move their registration from
one legal entity to another. That being said, if
there is a change in company shareholdings
but no change in the ABN/ACN of the
organisation registered with ASQA, the
provider can continue as long as they inform ASQA of the change in ownership. This is
referred to as a change of ownership by ASQA.

Change of ownership is considered high risk and can lead to a full-fledged audit
on the RTO’s registration to ensure the RTO is transferred to fit and proper persons.
The individuals thinking about buying a training provider must be aware of their
responsibilities under the Vocational Education and Training (VET) Quality Framework
and to ASQA, the national regulator.

Changes in company shareholding of 50% or more are considered significant. ASQA

aims to ensure that buying into a training provider does not enable a buyer to avoid the
scrutiny that is applied to initial applications.

2
 29TH EDITION

Registration requirements include:

a. Demonstrating compliance with Standards for Registered Training Organisations
(SRTOs) 2015 (the Standards)
b. Demonstrating compliance with Fit and Proper Person Requirements 2011
c. Demonstrating compliance with Financial Viability Risk Assessment Requirements
2011
d. Demonstrating compliance with Data Provision Requirements 2012
e. Demonstrating compliance with Australian Qualifications Framework

Along with meeting your legislative requirements under the VET Quality Framework,
you must also:
• cooperate with ASQA’s General Directions and compliance monitoring activities
• pay all required fees and charges associated with your registration
• comply with any additional licensing requirements imposed on particular VET courses.

In addition, if providing training to overseas students, you

will also be subject to the requirements of the Education
Services for Overseas Students (ESOS) Quality Framework.

The ESOS Framework is comprised of the:

• Education Services for Overseas Students Act 2000 (ESOS Act)
• National Code of Practice for Providers of Education and Training to Overseas
Students 2018 (the National Code)
• Education Services for Overseas Students Regulations 2019
• English Language Intensive Courses for Overseas Students (ELICOS) Standards 2018
(if applicable)

3
THE VET SECTOR | CAQA - Compliance & Quality Assurance

EVIDENCE REQUIRED FROM NEW OWNERS

The following evidence is

required from the new owners
of the training organisation:

FIT AND PROPER

PERSON REQUIREMENTS
DECLARATION:
Click here;
FINANCIAL VIABILITY RISK
ASSESSMENT TOOL:
Click here;

4
 29TH EDITION

THE FINANCIAL VIABILITY RISK

ASSESSMENT TOOL GUIDES
Through the process of considering the
key expenses faced by an RTO/CRICOS
provider and revenue forecasts. It assesses
financial viability risk by evaluating the
likelihood of business continuity, and
capacity to achieve quality outcomes.

The assessment informs a judgement about whether the organisation has the financial
resources necessary to:
• acquire and maintain the requisite assets and physical resources to deliver all
qualifications on its scope of registration
• employ sufficient appropriately qualified staff to cover the courses for which it takes
enrolments
• provide appropriate levels of student services to students
• remain in business to ensure that each student can achieve completion
• meet the above requirements, even in an unsure environment.

The Financial Viability Risk Assessment tool should be completed by the new owners of
the legal entity once the change is/will be completed. A registered accountant who is
external and independent to the training provider is required to certify the tool.

Other records, such as previous financial statements and a business plan, must also be
included with the tool. You must confirm that your financial statements are in order
and up to date, and that you have considered the future of your RTO.

5
THE VET SECTOR | CAQA - Compliance & Quality Assurance

SELF-ASSESSMENT TOOL FOR CHANGE OF OWNERSHIP

https://www.asqa.gov.au/resources/guides/self-assessment-tool-change-ownership

The self-assessment tool is a document that covers the standards and clauses as a
brand-new RTO registration.

The tools are separated into Section A and Section B

• Section A is to be completed
• Section B of these tools is only to be completed if 100% of shareholdings have changed
over 12 months and the provider has:
→ no ongoing students, or
→ has not had more than 10 students complete the training product in which they
were enrolled within the previous 12 months.

Entity records required include:

• ASIC company certificate
• ASIC company historical extract
• ASIC business name registration
• ABN certificate
• ASIC company historical extract of parent entities (showing the change of ownership)

NOTIFICATION REQUIREMENTS
If your provider is a VET-only training provider, you may notify ASQA of the change after
it occurs. As the new owner, notification is your responsibility.
If your training provider is CRICOS registered, you will need to inform ASQA of the
change in shareholdings before it occurs. You must also make sure the current owner
has also notified ASQA of the impending change of ownership. This is a requirement
under s17A (3) of the Education Services for Overseas Students Act 2000.
In line with Standard 8.1 of the Standards for Registered Training Organisations (RTOs)
2015, ASQA must receive this notification as soon as practicable, with 90 days after the
event the latest it can be received.
Any of the above-mentioned changes should be reported to ASQA using the
Notification of Material Change form. This form is available on ASQA’s online site,
asqanet.

You must also make sure the current owner

has also notified ASQA of the impending
change of ownership. This is a requirement
under s17A (3) of the Education Services for
Overseas Students Act 2000.

6
 29TH EDITION

AUDITS FOR COMPLIANCE MONITORING

ASQA will perform a compliance audit to review factual information where substantial
changes in ownership are subject to additional evidentiary criteria. The performance
evaluation (audit) will look at the training provider’s compliance with:

the applicable regulatory framework (VET Quality

or ESOS legislative) the clauses and requirements in
the Change of Ownership Self-Assessment Tool

This performance evaluation would look at whether or not the training company has
enough resources to provide quality training and assessment, reliable information, and
appropriate support to students.
If non-compliance is discovered during a compliance audit, regulatory action will
be taken in a proportionate manner. For the next 12 months, there will be increased
scrutiny.
Training providers that have undergone a substantial change of ownership may face
increased scrutiny in the 12 months following the completion of the enforcement
exercise.
This scrutiny will be extended to any proposals for changes to the scope of registration
from training providers during this time, as well as during a provider review at the end
of the period. Both of these actions can result in regulatory action, which may require
further compliance audits.
New owners of a training provider are responsible for any existing and outstanding
non-compliances, as well as any necessary rectification measures. New owners are also
responsible for any potential disciplinary action taken by ASQA against the organisation
in case of any non-compliance issues.

7
THE VET SECTOR | CAQA - Compliance & Quality Assurance

CHARGES
Notification of material change is free of charge; however, a compliance audit
operation triggered by notification may result in compliance audit charges for any RTO
operated under the NVR Act.

Obligations for RTOs Obligations on CRICOS providers

• Annual declaration on compliance
• Submit Total VET activity AVETMISS
data
• Submit quality indicator data
• Annual registration charge
• Ensure compliance with the VET
quality
• framework at all times
• Submit a renewal application at least
90 days prior to expiry
• ASQA annual registration charge.
Separate charges apply for RTO and
CRICOS registration.
• If registered as a CRICOS provider,
you’ll also need to pay the Department
of Education:
→ an annual registration charge
→ an annual Tuition Protection Service
(TPS) Levy.
→ Ensure compliance with the ESOS
framework at all times
→ Submit a renewal application at
least 90 days prior to expiry

Note:
1. Once the application and supporting evidence are submitted, there is no other
opportunity to include new or revised evidence. This is the same as when you first
registered as a new training provider with ASQA.
2. If the audit shows noncompliance, the regulator can issue a written directive to
correct the problem, impose conditions on the registration, issue a notice of intent
to impose sanctions, or cancel the registration. In other words, the sale of the RTO
can trigger a complete regulatory audit, exposing the organisation to regulatory
risks. This means that the evidence provided in the self-assessment must be 100%
compliant. The same as when you first registered as a new training provider with
ASQA.
3. The regulator has also established that an RTO that has a change of ownership
will face greater scrutiny in the twelve months following the completion of the
compliance activity by the regulatory body.

8
 Talk To Our Experts Now !

1800 266 160

2/10 Lawn Court, Craigieburn, VIC 3064 Australia

info@caqa.com.au
www.caqa.com.au

© 2013 - 2021 CAQA Resources by Career Calling International. All Rights Reserved.

Disclaimer: The information in this newsletter is for general informational purposes only and it is generalist in its approach. The information
presented in this newsletter is not legal advice or legal opinion, and it is not intended to be tailored to the specific circumstances of any
particular case and should not be relied upon as such. Persons should seek professional legal and compliance advice before acting upon any
of the information in this newsletter.