Bhutan Education City Act
TABLE OF CONTENTS
Chapter 1 Preliminary 2
Chapter 2 Education City Board 3
Chapter 3 Functions and Powers of the Board 8
Chapter 4 Development of the City 17
Chapter 5 Knowledge Centres and Service Providers 22
Chapter 6 Finance, Accounts and Audit 26
Chapter 7 Dispute Resolution 27
Chapter 8 Miscellaneous 28
Bhutan Education City Act 2012 1
Bearing in mind the Government’s vision to establish Bhutan as
a well-known hub for education with a strong presence of high
quality Educational Institutions;
Acknowledging the importance of an attractive environment on
economic, social and educational grounds for high quality
Educational Institutions to be present in Bhutan;
Convinced that the presence of high quality Educational
Institutions in Bhutan would contribute to the improvement of
the overall quality of the Bhutanese education system; and
Recognizing that the establishment of the City would spur the
economic development of Bhutan through direct and indirect
Parliament of the Kingdom of Bhutan do hereby enact the
Bhutan Education City Act 2012 on the 9
Day of 5
the Water Male Dragon Year of the Bhutanese Calendar
corresponding to the 28
Day of June 2012 at its 9
Bhutan Education City Act 2012 2
Title, commencement and extent
1. This Act shall:
(1) Be called the BHUTAN EDUCATION CITY
(2) Come into force on the 18th day of 7th Month of
the Water Male Dragon Year of the Bhutanese
Calendar corresponding to the 3
September 2012; and
(3) Extend to the whole of Bhutan.
2. This Act shall apply to the establishment, development,
promotion, operation, management and maintenance of
the City and such other persons associated with the City
in whatever capacity as provided for in this Act and the
Bhutan Education City Act 2012 3
3. This Act shall not apply to:
(1) The Royal University of Bhutan except to its
Knowledge Centres it may establish in the City;
(2) Other universities, schools, colleges or institutes
whether public or private except to their
Knowledge Centres which they may establish in
EDUCATION CITY BOARD
Establishment of the Board
4. There shall be an Education City Board established
under this Act.
5. The Board is a body corporate with perpetual succession
and a common seal.
6. In exercising the powers vested in it by this Act the
Board is an autonomous body.
Bhutan Education City Act 2012 4
7. The Board may:
(1) Enter into contracts;
(2) Acquire, hold and dispose of property, whether
movable or immovable and to pledge and
mortgage the same in keeping with the laws of
(3) Exercise all powers specifically granted by this
Act to it, and such incidental powers, as may be
necessary to carry out the powers so granted; and
(4) Sue and be sued in its own name.
8. The head office of the Board shall be at Thimphu or at
such other place as the Board may determine from time
Constitution of the Board
9. The ex-officio members of the Board shall comprise of
(1) Minister, Ministry of Works and Human
Bhutan Education City Act 2012 5
(2) Vice-chancellor, Royal University of Bhutan;
(3) Secretary, Ministry of Home and Cultural
(4) Secretary, Ministry of Economic Affairs;
(5) Secretary, Ministry of Finance;
(6) Secretary, Ministry of Education;
(7) Secretary, Ministry of Labour and Human
(8) Secretary, GNH Commission;
(9) Dzongdag of Thimphu Dzongkhag;
(10) Gup’s of the relevant Gewog’s;
(11) Chief Executive Officer, DHI Infra Ltd;
(12) One private sector representative appointed by
the Bhutan Chamber of Commerce and Industry;
(13) Chief Executive Officer of the Secretariat.
Bhutan Education City Act 2012 6
10. The Board may invite special invitees to the board
meeting from time to time as it may deem fit.
Service of notice and other documents
11. Any notice or other document may be served on the
Board by delivery or by prepaid registered post to the
12. The presence of two third of the members constitutes a
quorum for a meeting of the Board.
13. There shall be a secretariat of the Board to assist the
Board in discharging its functions, to provide analysis
and recommendations to the Board as and when required
and to perform such other functions, and exercise such
powers as may, from time to time be delegated by the
Bhutan Education City Act 2012 7
14. The Board shall supervise the Secretariat and shall issue
directions in relation to the duties, functions and powers
of the Secretariat.
15. The Secretariat shall be headed by a chief executive
officer appointed by the Board who shall be the ex
officio member secretary to the Board and the
Secretariat shall comprise of such number of staff as the
Board may deem fit.
16. The salary, tenure, discipline and other conditions of
service of the Chief Executive Officer shall be as
determined by the Government.
17. The salary, tenure, discipline and other conditions of
service of the staff of the Secretariat shall be as
determined by the Board.
18. The operating expenses of the Secretariat, including
equipment, shall be drawn from the appropriate fund and
the surplus fund, if any, shall be deposited into the
revenue account of the Ministry of Finance.
Bhutan Education City Act 2012 8
FUNCTIONS AND POWERS OF THE BOARD
General functions of the Board
19. The Board shall:
(1) Be the apex Government body in Bhutan for
establishment, development, operation,
promotion, maintenance and management of the
City through a public-private partnership (PPP)
or other models including Government
undertaking, joint venture or a full private
(2) Recommend to the Government to ensure that
the Policies and Laws applicable to the City are
suited to efficiently meet the goals of the City;
(3) Assume all rights and duties under the
Agreement on behalf of the Government
including provision of ancillary infrastructure to
Bhutan Education City Act 2012 9
(4) Liaise with the Government, the Concessionaire,
the Knowledge Centres, the Service Providers,
the Students and any other Person associated
with the City on issues relating to the City; and
(5) Perform all other functions as may be required or
deemed fit by the Board in the letter and spirit of
this Act or which may be entrusted to it by the
Cabinet from time to time.
20. In discharging its functions and exercising its powers to
meet the goals of the City, the Board shall:
(1) Recommend to the Cabinet or to any
Government agencies any new Laws or Policies,
any amendments thereto or any limits of the
scope of any applicable Laws or Policies needed
or desirable to achieve the goals of the City;
Bhutan Education City Act 2012 10
(2) Ensure that the City is built and operated in
accordance with the Policies of the Government
especially that the City shall provide both quality
education and economic development in Bhutan;
(3) Ensure that activities pertaining to the City are
fair and transparent;
(4) Promote the City consistent with the Laws,
Policies, environmental issues, national heritage
and gross national happiness;
(5) Take steps to ensure that Bhutanese nationals
benefit from the City, including by securing
scholarships or favourable financing terms for
(6) Ensure employment for Bhutanese in accordance
with national laws and policies;
Bhutan Education City Act 2012 11
(7) Have due regard to the national security and
(8) Strive to promote conditions that will enable
sustainable operations and business for the
(9) Endeavour to provide reasonable security for
loans given in connection with the City; and
(10) Encourage competition in the City.
21. The Board is empowered to:
(1) Act as a nodal agency;
(2) Supervise and monitor that the operations of
the Concessionaire, Educational Institutions,
Knowledge Centres, Service Providers or any
other Person associated with the City are in
accordance with this Act, the Agreement and all
applicable Laws and Policies;
Bhutan Education City Act 2012 12
(3) Approve plans, contracts, timelines and other
matters according to the Agreement;
(4) Provide Support to the Concessionaire,
Educational Institutions, Knowledge Centres,
Service Providers, Students and any other Person
associated with the City;
(5) To discharge the municipal functions in the City
directly or at its discretion through the
Concessionaire in accordance with the
Agreement or later amendments thereto;
(6) Collect the Concession Fee; and
(7) Create and administer such funds and spend and
allocate such sums as it deems fit for the
purposes set forth in this Act subject to approval
by the Government.
22. The Board shall act as the nodal agency for all
Permissions that may be required by the Concessionaire,
Bhutan Education City Act 2012 13
Educational Institutions, Knowledge Centres, Service
Providers and any other Person associated with the City.
23. The Secretariat shall assist the applicants in completing
applications, acknowledge completed applications and by
sending such applications to the Competent Authority for
processing and disposal within the prescribed time frame
and monitor the status of the applications.
24. In case any Competent Authority fails to process or
dispose of any application within the prescribed time
frame set by the Competent Authority, the Board may
place the application before the Cabinet for consideration
and the Cabinet shall, after due consideration, reject the
application or may direct the Competent Authority to
grant or issue the Permission on such terms and condition
as the Cabinet may direct.
25. The Board shall supervise and monitor:
Bhutan Education City Act 2012 14
(1) The establishment, development, promotion,
operation, maintenance and management of the
(2) That the Concessionaire undertakes its business
in accordance with this Act and the Agreement;
(3) The creation, construction and operation of the
Project Infrastructure and the Project Facilities;
(4) The quality of services in the City; and
(5) That all applicable Laws and Policies are being
adhered to in the City.
26. The Board is empowered to call upon the
Concessionaire, Educational Institutions, Knowledge
Centres, Service Providers or any other Person
associated with the City to furnish information,
documents and particulars as may be required by the
27. If the operations of the Concessionaire, Educational
Institutions, Knowledge Centres, Service Providers or
any other Person associated with the City are not in
Bhutan Education City Act 2012 15
accordance with this Act, the Agreement or all
applicable Laws and Policies the Board shall:
(1) Take such corrective measures mandated in this
Act, in the Agreement or in such other
agreements to which the Board is a party as the
Board deems fit;
(2) Collect damages and the likes for breach of the
Agreement or for breach of such other
agreements to which the Board is a party; and
(3) Prevent with the help of law enforcement
agencies and other agencies of Government any
breach of applicable Laws and Policies
Functions of approval
28. The Board’s power to approve plans, contracts,
timelines and other matters according to the Agreement
(1) The master plan and the layout of the City on the
Site, architectural design and construction plans
of the Project Infrastructure and the Project
Bhutan Education City Act 2012 16
Facilities which is to be prepared by the
(2) The templates of all and any contracts including
for leasing of premises to the Educational
Institutions and Service Providers.
29. The Board may approve or reject the plans, contracts,
timelines and other matters with or without conditions.
30. The Board shall propose to the Government fiscal or any
regulatory incentives, exemptions, subsidies or other
supports to be provided by the Government in relation to
the City. Such Support may include:
(1) Provision of fiscal incentives;
(2) Allowing foreign direct investment up to 100%;
(3) Investment incentives including repatriation of
Bhutan Education City Act 2012 17
(4) Easy procedures for granting visas and work
permits to Students, faculties, staff of the City,
their families and any other Person associated
with the City;
(5) Part or full exemption from applicable Policies;
(6) Any other Support as may be deemed fit by the
DEVELOPMENT OF THE CITY
Establishment and development of the City
31. A city to be called the Bhutan Education City or any
other name as recommended by the Board from time to
time shall be set up in accordance with this Act to be the
centre in Bhutan mainly to impart quality education and
knowledge through a public private partnership (PPP) or
other models including government undertaking, joint
venture or a full private participation.
Bhutan Education City Act 2012 18
32. The Concessionaire shall establish, develop, promote,
operate, maintain and manage the City in accordance
with this Act and the Agreement.
33. The Project Work shall be carried out in accordance
with the applicable Laws and Policies and shall adhere
to the environmental concerns of the Government.
34. The Project Infrastructure and the Project Facilities shall
be developed, operated, maintained and managed in
accordance with Laws, Policies and the Agreement
except for those for which international norms and
standards are required to be followed for utility and
Designation of the Site
35. The title over the Site shall vest with the Government.
36. The Government shall be responsible for any acquisition
of land for the purposes of designation or expansion or
for any other purposes in relation to the City in
accordance with the Laws.
Bhutan Education City Act 2012 19
37. No injunction shall be granted by any court or other
authority in respect of any action taken or to be taken in
pursuance of any power conferred by or under this Act.
38. The Government may lease the Site to the
Concessionaire in accordance with the Land Act.
39. The Concessionaire shall be selected through a
transparent and fair process in accordance with Laws
40. The Concessionaire shall be incorporated under the
Laws, as a company solely to establish, develop,
promote, operate, maintain and manage the City, which
is to be called the Concessionaire.
41. The Concessionaire, under the general superintendence
and control of the Board, shall:
(1) Establish, develop, promote, operate, maintain
and manage the City;
Bhutan Education City Act 2012 20
(2) Assume the rights and duties under the
(3) Invite, select and enter into contracts with
credible, reputed and quality Educational
Institutions, Service Providers, and other Persons
for the purposes of development, operation,
maintenance and management of the City;
(4) Promote the City within and outside of Bhutan in
accordance with Laws, Policies and the
(5) Prepare construction plans and architectural
design of the Project Infrastructure and the
Project Facilities for review by the Board;
(6) Recommend to the Board granting, withdrawing
or suspending any Support in relation to Persons
associated with the City and advise the Board on
additional or new Support;
Bhutan Education City Act 2012 21
(7) Collect user charges from the users of the Project
Infrastructure and the Project Facilities unless
otherwise agreed; and
(8) Perform such other functions, acts or things,
which may be provided for by the Agreement or
assigned or directed to it by the Board.
42. The Concessionaire shall transfer the City to the
Government upon expiry or termination of the
Agreement in accordance with the Agreement.
Authority Designated Area
43. The Government shall lease the Authority Designated
Area to DHI Infra Ltd.
44. The Authority Designated Area shall be developed and
used for purposes set out in this Act and the Agreement.
Bhutan Education City Act 2012 22
KNOWLEDGE CENTRES AND SERVICE PROVIDERS.
Educational Institutions and Knowledge Centres
45. The Concessionaire shall lease the Project Infrastructure
and the Project Facilities and enter into contract only
with Educational Institutions subject to their compliance
with any Laws or Policies regulating establishment,
accreditation, registration and licensing.
46. The Educational Institutions shall apply to the
Competent Authority through the nodal agency for
registration, licence and other Permissions in the manner
and form prescribed by Law with all documentation and
information as prescribed.
47. The Competent Authority shall, upon its satisfaction,
permit or grant establishment, accreditation, registration,
licence and other Permissions or convey its objections to
the Educational Institutions within a reasonable time.
Bhutan Education City Act 2012 23
48. The Competent Authority shall create and apply a fast
track procedure for highly reputed Educational
Institutions or Academic Courses.
Academic freedom and autonomy of Knowledge Centres
49. The Government, the Board and the Concessionaire
shall ensure the academic freedom and autonomy of the
Knowledge Centres including curriculum independence
subject only to the Laws or Policies regulating
establishment, accreditation, registration and licensing.
50. Notwithstanding the generality of the foregoing, the
Knowledge Centres and Service Providers may subject
to this Act, Laws, Policies and the Agreement freely:
(1) Recruit, deploy, promote, train and compensate
their leadership, faculty or staff;
(2) Charge Students fees, raise funds from
government or private sources and utilize its
Bhutan Education City Act 2012 24
(3) Offer any Academic Courses;
(4) Perform research and scholarly works; and
(5) Form student associations.
51. Any freedom or autonomy granted by this Act shall not
limit any other Support that may be granted or any other
freedom prescribed by Law.
Knowledge Centres affiliation to religion
52. The education City may permit the establishment of :
(1) Knowledge Centres affiliated to religion on
equal terms and subject to the same requirements
as other Knowledge Centres, provided that they
offer secular Academic Courses; and
(2) Knowledge Centres affiliated to Buddhism as
recognized in the Constitution of Bhutan to offer
Academic Course on Buddhism in the City.
Bhutan Education City Act 2012 25
53. Knowledge Centres shall maintain high quality of
education and knowledge and shall create and maintain
effective internal and external quality assurance systems
that cover all Academic Courses in accordance with
applicable Laws and Policies.
54. The Concessionaire shall enter into contracts with the
Service Providers in the form and on terms approved by
55. All Service Providers shall obtain applicable
Permissions before setting up operations in the City.
56. The Concessionaire shall ensure that the Service
Providers maintain a high quality of service at all times.
Bhutan Education City Act 2012 26
FINANCE, ACCOUNTS AND AUDIT
57. The activities of the Board shall be funded from:
(1) Levies, fees and other charges payable to the
Board by the Concessionaire and any other
Person associated with the City in its
performance of functions under this Act,
including but not limited to the Concession Fees;
(2) Interim budgetary support from the Government
until the Board’s own funds is sufficient to cover
Accounts and audit
58. The accounts of the Board, the Concessionaire, the
Knowledge Centre and the Service Providers shall be
prepared, maintained and audited in such form and in
such manner as prescribed by Law.
Bhutan Education City Act 2012 27
59. The Board shall, at the end of each financial year,
prepare and submit to the Cabinet in such form and at
such time as may be prescribed, an annual report giving
a true and full account of its activities during the
previous financial year and the activities that are likely
to be undertaken by it in the next financial year.
60. The Concessionaire shall prepare and submit to the
Secretariat for the perusal of the Board, quarterly reports
giving a true and full account of its activities and the
activities of the Knowledge Centres and Service
Providers during the previous quarter and shall give
details of the activities that are likely to be undertaken in
the next quarter.
61. Any dispute, difference or controversy of whatever
nature between the Board and the Concessionaire shall
Bhutan Education City Act 2012 28
in the first instance be attempted to be resolved amicably
by conciliation in accordance with the Agreement.
62. Any dispute, which is not resolved by conciliation, shall
be finally decided by arbitration in accordance with the
63. The Bhutanese courts shall enforce an arbitration award
against the assets of the party who is to pay the award.
Powers of the Board to make rules
64. The Board may make rules consistent with this Act for
carrying out the purposes of this Act.
65. In particular and without prejudice to the generality of
the foregoing power, such rules may provide for the
(1) Granting of Permissions to Knowledge Centres;
Bhutan Education City Act 2012 29
(2) City development control; or
(3) City management.
(4) Rules of Procedure for conduct of its meetings;
(5) Salary, tenure, discipline and other conditions of
services of the staff of the Secretariat; or
(6) Any other matters in relation to which rules are
required to be made.
66. The Board shall adopt its rules of procedure by a simple
majority of its members present and voting provided that
the rules are in accordance with this Act.
Breach of the Agreement
67. The Board is liable to compensate the Concessionaire in
accordance with the Agreement in the event of breach of
the Agreement by the Government.
68. The Board is empowered to pay a termination payment
in accordance with the Agreement in the event of the
Bhutan Education City Act 2012 30
Immunity from prosecution
69. No legal proceeding or suit may lie against any member
of the Board or its staff or a person acting for the Board
in respect of their official duties done in good faith or
intended to be done pursuant to the provisions of this
Act. Such immunity does not cover corrupt acts
committed by such persons.
70. The Board may negotiate such changes to the
Agreement as may be mutually agreed upon between the
Board and the Concessionaire to achieve the visions and
goals of the City.
71. The amendment of this Act by way of addition, variation
or repeal shall be effected by a simple majority of the
respective houses or by a vote of no less than two-thirds
of the total members of parliament present and voting on
a motion submitted by one-third of the members of
Bhutan Education City Act 2012 31
72. The Dzongkha text shall be the authoritative text, if
there exists any difference in meaning between the
Dzongkha and the English texts.
73. In this Act, unless the context otherwise requires the
following terms have the following meanings:
(1) “Academic Courses” mean all academic or
vocational programs or courses, trainings and
other education and knowledge based modules
whether or not they lead to grant of certificates,
degrees or diplomas.
(2) “Act” means the Education City Act of Bhutan
(3) “Agreement” means the concession agreement
for establishing, developing, promoting,
operating, managing and maintaining the City.
Bhutan Education City Act 2012 32
(4) “Authority Designated Area” means the 50
acres of land within the City as identified in the
Agreement that the Concessionaire shall partially
develop and hand over to the Government to be
give to the DHI Infra.
(5) “Board” means the Education City Board.
(6) “Cabinet” means the cabinet of the Government
(7) “Chief Executive Officer” means the chief
executive officer of the Secretariat.
(8) “City” means the Bhutan Education City, which
shall be a dedicated zone mainly for education
and knowledge in the Kingdom of Bhutan.
(9) “Competent Authority” means any department
or an agency of the Government, any local or
statutory authority, constitutional offices, or any
other authority constituted or established under
any Laws or Policies or under administrative
control of the Government which is entrusted
Bhutan Education City Act 2012 33
with the powers and responsibilities to grant or
issue Permissions in relation to the City.
(10) “Concession Fee” means any amount of money
required to be paid by the Concessionaire to the
Board in accordance with the Agreement.
(11) “Concessionaire” means a company with whom
the Agreement is entered into by the Board and
to whom a concession has been granted for
establishment, development, promotion,
operation, management and maintenance of the
(12) “Educational Institutions” mean institutions
whether domestic or foreign imparting education
and knowledge from pre primary to tertiary
education, research, and short term courses or
training and shall include vocational Courses and
Bhutan Education City Act 2012 34
any other category as the Cabinet may determine
on the recommendation of the Board.
(13) “Government” means the Government of
(14) “Knowledge Centres” mean the institutes set up
in the City by Educational Institutions offering
Academic or vocational Courses or doing
research, innovation and other ancillary activities
usually performed by Educational Institutions.
(15) “Laws” mean all legislation that are in force in
Bhutan including all rules, regulations and
notifications, including any orders, judgments or
decrees of any court.
(16) “National Educational Institutions” mean the
Educational Institutions outside the City
established in Bhutan whether domestic or
(17) “Permissions” include any clearance, approval,
consent, no objection, registration, enrolment,
Bhutan Education City Act 2012 35
licence and the likes by the Competent Authority
in relation to the City.
(18) “Person” means a natural or a juridical person.
(19) “Policies” mean policies, guidelines and
directives issued or revised, amended, changed
or re promulgated by the Government from time
(20) “Project Facilities” mean all the amenities and
facilities required under the Agreement to be
developed, operated, managed and maintained on
the Site by the Concessionaire.
(21) “Project Infrastructure” means all real estate
and infrastructure required under the Agreement
to be developed, operated, managed and
maintained on the Site by the Concessionaire.
Bhutan Education City Act 2012 36
(22) “Project Work” means erection, creation and
construction of Project Facilities and Project
(23) “Secretariat” means the secretariat of the
(24) “Service Providers” mean Persons providing
accommodation, entertainment, hospitality,
maintenance, retail or other services not offered
by Knowledge Centres.
(25) “Site” means the land on which the City is to be
(26) “Students” mean the students enrolled with the
(27) “Support” means the fiscal or any regulatory
incentives, exemptions, subsidies or other
supports provided by the Government in relation
to the City.