BEIJING, October 25 (TMTPOST) —Chinese education giant New Oriental Group’s online learning arm Koolearn Technology (01797.HK) will suspend tutoring services involving subjects on China’s compulsory education curriculum by late November 2021, the company said in an announcement filed with HKEX.
Source: Visual China
Considering the latest regulatory changes in mainland China, Koolearn Technology’s board has decided to stop providing tutoring services relating to school subjects for K-9 students or students receiving the country’s compulsory education. This means that the company will no longer provide online learning services for students in kindergartens, primary and secondary schools.
Founded in 2005, Koolearn Technology is an online education arm of New Oriental Education & Technology Group (NYSE: EDU) and one of the earliest online education platforms in China. The company went public at HKD$10.2 per share in Hong Kong in March 2019. According to the company’s 2020 fiscal report, the company’s revenues hit RMB1.081 billion, jumping by 17.6% year-on-year. The company had around 2.8 million paying students in 2020, registering a year-on-year increase of 30.9%.
China announced its "double reduction" policy earlier in July this year, restricting private education service providers’ business operations and forcing private tutoring companies to go non-profit as a way to improve education equality and reduce pressure on students. The "double reduction" policy imposes heavy restrictions on the provision of tutoring services on school subjects and online education, which has had a devastating impact on tutoring centers that focus on the school curriculum. According to the Ministry of Education on Monday, Beijing has reduced the number of tutoring centers focusing on school subjects without relevant licenses and qualifications by 98% in the city. The number of tutoring and training centers has decreased by 60% in total, the ministry said. It is reported that the Beijing government has provided guidance for training and tutoring centers to transition and provided around 220,000 job opportunities for professional talents working in the tutoring industry.