International expansion for independent schools – protecting the UK school

As a team, we have a wealth of experience advising on overseas partnerships for leading UK independent schools. The trend and appetite for these transactions have grown significantly over the past few years, especially as operational and financial pressures increase in the UK.

In our previous article – the first instalment in a three-part series – we looked at the initial scope of a project (potential markets, partners and structures). This piece acknowledged the diversity and nuances of international school partnerships and that the transaction will vary greatly depending on factors such as the territory and the nature of the parties.

However, one of the consistent points of interest, and indeed core concerns, we have encountered whenever advising on and negotiating these deals is how to protect the UK school at home. This is the bedrock of any transaction and the entire focus of any contract; however, the point is particularly acute when it comes to overseas partnerships for schools given:

• the international dimension (and associated risks and 'unknowns');
• the heightened reputational scrutiny which UK independent schools are subject to; and
• the extent to which a trading subsidiary can adequately shield the home school from fallout and risk.

This article identifies the different risk areas and examines how they can be addressed in order to protect your school.

Please note: we have referred to 'school' throughout, although in practice the contractual arrangements will be entered into by a trading subsidiary (see our first article, and further below).

Quality control

International partnerships are typically governed by some form of services and licence agreement, ie the UK entity (typically via its trading subsidiary) provides its educational services and brand in return for payment, while the overseas partner builds and operates the school. One of the key negotiation points (and wider questions in terms of the suitability of the partnership) will be the quality control that the UK school (or its trading subsidiary which is party to the contract) exerts on the partner.

There are various frameworks one can rely on to achieve this: for example, by introducing some sort of committee (on which the UK school holds a majority) which will make educational and curriculum-based decisions for the new school. Alternatively, requiring the partner to follow a handbook/framework which contains all your know-how, guidance and instructions is another option.

While one would expect reputable and market-leading overseas partners to place the same value on high-quality educational delivery, it is nonetheless critical that the UK school's service delivery carries weight and the partner is held to a high standard.

Branding

This goes hand-in-hand with the educational calibre of the new school. The entire project will invariably hinge on high standards combined with a strong brand (with both elements bolstering each other).

Good branding requires protected intellectual property (IP): this means ensuring that you have registered (or are able to register) trade marks for the new school's name, logo and any other core brand elements in the relevant territory. Remember: just because you have a strong legacy brand in the UK does not automatically confer the same rights in another country. You will need to check whether any other rival schools have similar registered trade marks in the country of choice and work with your partner (whether during the pre-contract negotiation phase or after execution) to deploy a workable trade mark strategy. If your contract stipulates that you will apply to register trade marks after the contract is signed, then consider what should happen if none of the applications are successful – does the partnership end or will you work together to identify a new, lower-risk name?

Relatedly, there is the question of how to protect your IP in terms of the partner's use of it. This includes terms on how they can use your know-how (eg curriculum materials), who will own any new IP which is developed and, perhaps most importantly, what happens if the partnership ends – this will likely require tight restrictions on the partner using your trade marks and other IP if they are no longer your partner.

Staffing

Ensuring that the new school is operated by suitably skilled and experienced personnel is a similar point to overarching quality control. Again, while your UK school may have few to no people physically based in the overseas territory running the operation, it is important that your contract contains adequate controls to ensure the partner is employing the right people.

You could consider imposing hiring metrics (background checks, safeguarding assessments, high salary offers) and/or being closely involved in the process. The latter is particularly relevant when hiring senior staff and some UK schools require the right to interview and have a veto over the hiring of the head, bursar and other important roles.

In terms of protecting its own staff, we have seen contracts which impose restrictions on the solicitation/poaching of teachers and other staff at the home institution (or at other overseas franchises connected to the UK school).

Risks for the (non-trading subsidiary) entity

As noted previously, while many UK schools will use a trading subsidiary as the contracting entity for overseas partnerships, one must still be mindful of risk and liability creeping back up to the main UK entity. This is often a territory-specific issue – for example, in some countries the local education ministry may require certain undertakings or resolutions from the home school to step in and/or exercise involvement in the project as a sign of commitment. There is then the associated risk of being sued (for example, by local parents) or being entrenched in an unattractive project if something goes wrong. The protections/mitigations required are again dependent on the local territory but may involve indemnification from the local partner (discussed further below) if the home school is sued, insurance coverage, and seeking advice from local lawyers.  

Liability and indemnities

The quantum and scope of liability exclusions and related indemnities will vary for each transaction and depend on the parties' risk appetite, relative negotiating power and commercial position (among other factors).

However, the general framework we push for is that the UK school, and its subsidiary – as the party operating from a distance and lending its own brand and expertise – should naturally enjoy a more generous liability cap and the benefit of more indemnities. The indemnities are especially important and provide vital cover if the overseas partner's (mis)conduct blows back to the UK school; examples include compensation for failures to comply with local laws, misuse of the trade marks it has been licensed, staff employment, and personal injury claims (eg if the school has been constructed negligently).

Indemnities are toothless though if the partner does not have the means to pay them. Therefore, these terms need to be backed up by insurance provisions to ensure that the partner has adequate cover across various categories of liability.

Third parties

In our experience, one of the most hotly negotiated clauses relates to changes of control. UK schools need to guard against the risk of their partner (or the partner's parent/UBO) changing hands and being operated by a new, potentially less suitable owner. For example, if the company which controls your partner is now a rival educational group or, worse, someone involved in a reputationally damaging business.

In an ideal world, the UK school would want the right to veto any change of control – where this is not workable, we have seen moratoriums on changes of control for a fixed period, discrete veto rights for certain changes within the corporate structure and/or prohibitions on transfers to owners involved in certain blacklisted businesses (eg firearms or gambling).

Regulatory controls

Concerns over compliance, risk and general conduct on the partner's part (or their own partners/subcontractors) may be heightened depending on the territory – therefore, the case for robust clauses which address these issues is even stronger. For example, ensuring that personal data is handled securely, there is no modern slavery in the supply chain, and anti-bribery policies are incorporated. While many of these legal frameworks are technically UK-facing, they are often the gold standard in terms of compliance and it is possible to build in parallel provisions to cover local laws too.

Exit rights

Arguably, the most important clause in an overseas partnership contract is how to end that contract – these terms are a wrap-up of all the risks discussed above and ensure that the UK school can exit if something goes wrong.

Given the scope and complexity of these deals, it is generally better to identify these risks and the associated termination rights individually rather than relying on a general 'material breach' right (although this is often a helpful sweep-up since you cannot cover every variable).

Common examples include:

• non-payment;
• safeguarding risks;
• severe breaches of local law;
• insolvency; and
• criminal conduct by a director or other principal.

A particularly sensitive negotiation point is the so-called 'reputational' trigger which some UK schools require, ie if something happens in the territory that causes reputational damage to the home school, that gives rise to a termination right. This helps to mitigate social and political risks – for example, if a hostile government suddenly took power.

Due diligence!

The points above are a selection of some of the key risks and associated protections which must be considered for international schools partnerships. The full range and indeed specific nature of these risks and mitigations will depend on the territory, the counterparty and the deal structure (among other variables).

A crucial point to bear in mind though is that a contract, no matter how favourable, cannot exist in a vacuum – as noted in our previous article, the success of a potential deal is heavily dependent on the suitability of your prospective partner, and this can only be determined through careful due diligence.

It is vital that you research these details. A well-drafted contract works in tandem with prior due diligence rather than as an impermeable shield against a lack of due diligence (or a problematic partner).

Part three of this series comes next – stay tuned!

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, February 2026