Education Sector
Nazanin Maghsoudlou Senior Associate, Corporate Structuring
Darya Ghasemzadeh Trainee Solicitor, Corporate Structuring
Online learning, e-learning, and distance learning are terms often used to describe learning conducted via electronic media, typically the internet, which has gained increasing relevance in the post pandemic world. The Covid-19 pandemic, which globally forced 1.2 billion children out of the classroom , dramatically accelerated the adoption of online learning and blended learning globally.
This shift will not be reversed. Therefore, a key question is: what legal ramifications, if any, does e-learning pose for businesses seeking to enter this market?
It is important to remember that the education sector has traditionally lagged behind other sectors - and by a significant margin – in digitalisation . However, the extent of digitalisation continues to vary significantly between educational institutions. The terms e-learning, distance learning and online learning, are broad enough to encompass a variety of software and solutions.
E-learning software and solutions used by educators, range from interactive software specifically developed for educational institutes, such as “Blackboard” and “Google Classroom” which facilitate a virtual learning environment, to general e-conferencing tools like Skype and Zoom (which are multifaceted tools not specifically tailored to educators).
Within the multi-billion dollar market for fully online courses and Massive Online Open Courses “MOOC degrees”, organisations use highly innovative emerging technologies such as cloud computing, artificial-intelligence and machine-learning. They seek to leverage data from tens of millions of learners around the world to offer tailored content and automatically grade assignments.
Conversely, many schools and universities fail to take advantage of all the new technology. Instead they rely largely on simple video conferencing tools like Zoom.
Other technologies that are transforming the e-learning industry include augmented reality, virtual reality and gamification. Virtual reality can enable teachers and students to interact in a met averse, and to explain concepts with the help of 3-D objects.
Recognising the opportunities provided by e-learning, the UAE government has invested heavily in educational technology, and has launched numerous e-learning initiatives over the years.
For example, the UAE’s Ministry of Education (MOE) and the UAE's Telecommunications and Digital Government Regulatory Authority (TDRA), in cooperation with the UAE Prime Minister's office, together launched a AED 1bn initiative named the Mohammed Bin Rashid Smart Learning project. This venture looked to equip more than 400 campuses with the latest 4G networks, eBoards and smart tablets. The project also delivered electronic content, including textbooks on iPhones, iPads and Android platforms.
Another UAE government initiative, the Digital School, aims to provide a certified online education to students in refugee camps and marginalised communities. E-learning has also been given a significant boost through the bachelor’s and master's courses from Hamdan Bin Mohammed Smart University (HBMSU) which are fully accredited in the UAE.
The e-learning market, can broadly be separated into two categories: fully online learning and blended learning (i.e. where some of the tuition takes place in a traditional classroom). In the case of the former, the tuition may be offered to the world at large; in the case of the latter, the tuition will likely be offered to people in the UAE. These differences have significant legal, business and licensing implications.
Organisations that are providing fully online offerings from within the UAE (i.e. the mainland or a Free Zone) will be subject to article 11 (1) of the Federal Law No. 2 of 2015 (the Companies Law). The article requires all companies to secure the necessary approvals and licenses that are needed to operate in the country.
In contrast, foreign organisations that are established outside the UAE, but who are providing online education services to students in the UAE, are in general subject to Article 328 (1) of the Companies Law. This article states that foreign companies may “not conduct any activity” inside the UAE without a license issued by the competent authority and without the consent of the Ministry of Economy (MOE).
There is no clear explanation in the Companies law of when an e-learning platform will be deemed to be conducting business activities in the UAE.
The mere fact that an online learning platform, which is operated from outside the UAE provides educational content to students around the world, including students within the UAE will not, in and of itself, require a business license and company registration in the UAE.
However, the organisation will likely be required to be licensed if: any activities are physically taking place in the territory of the UAE: the educational offering is clearly and specifically targeted at people in the UAE; or, there is some other obvious link to the country.
This means that, for instance, a blended learning business model tailored to students in the UAE, which involves in person teaching sessions in the UAE as well as online lessons will have to secure all approvals and licenses, required for exercising its activities in the UAE.
Similarly, a fully online university which specifically targets and tailors its courses to students in the UAE (e.g. by using a country specific URL, adopting a UAE specific server, or including the local Arabic language or local currency for tuition fees) will likely also require approvals and licenses. In addition to obtaining a commercial license form the Department of Economic Development (DED) for mainland businesses (or where applicable, obtaining a license from the relevant Free-Zone authority), the e-learning organisation will also need to obtain the requisite educational permits and licenses from the relevant regulatory bodies in each of the relevant emirates.
The main regulatory authorities for education provided in the UAE are: the Ministry of Education (”MOE”); the Knowledge and Human Development Authority (”KHDA”) of Dubai; the Abu Dhabi Department of Education and Knowledge (”ADEK”) and the Abu Dhabi Centre for Technical and Vocational Education and Training (“ACTVET”). For more details on what operating as an education provider in the UAE entails, please see this article.
There are also other legal considerations to bear in mind. For example, there are data protection considerations to be wary of. Specifically, the UAE’s Federal Data Protection Law has extraterritorial impact. Not only does it capture e-learning businesses within the UAE, but it may, possibly also capture online learning websites which are accessible to data subjects within the territorial scope of the UAE.
Moreover, many e-learning platforms are data intensive and use machine learning: this can lead to further data protection implications concerning “profiling”.
Protection of intellectual property is also an issue, given that content that is used for teaching may or may not originate with the e-learning organisation.
For further information, please contact Nazanin Maghsoudlou or Omer Khan.
Published in August 2022
Illustration of Marie Curie
