What counts as provider default at an Australian college in 2026?

Plain-language guide · general information, not immigration advice

At a CRICOS-registered Australian college, provider default happens when the college fails to start your course on the agreed starting day, or the course stops being delivered after it starts but before it is completed, and you have not withdrawn before the default day. That two-limb test comes from section 46A of the Education Services for Overseas Students Act 2000 (ESOS Act), as set out in the Federal Register of Legislation text current as at the September 2026 official page. A second route to the same outcome sits in section 46A(2): if a Part 6 sanction stops the provider from delivering the course at that location, that is provider default as well, without any need to argue about intent or insolvency.

This article explains how the definition works, not what any individual student should do about their own enrolment or visa. It is general information about the legislation, not personalised advice, and the details that apply to a specific situation should always be checked against the official text and, where it matters, with a registered migration agent or lawyer.

What exactly has to happen for it to be provider default?

Section 46A(1) breaks the test into two elements, and both must be present.

First, one of two things occurs in relation to a course at a location:

the provider fails to start providing the course to the student at that location on the agreed starting day; or
the course ceases to be provided to the student at that location at any time after it starts but before it is completed.

Second, the student has not withdrawn before the default day.

The phrasing matters more than it first appears. The test is tied to a specific course at a specific location, not to the college as a whole — a provider could default for one campus or one course while continuing to teach others. And "agreed starting day" is a reference point fixed by the enrolment, so the question is whether delivery began when it was supposed to, not whether the college later made good.

Does a Part 6 sanction count, even if the college plans to reopen?

Yes. Section 46A(2) removes any doubt: a registered provider defaults if it is prevented from providing a course at a location because a sanction has been imposed on it under Part 6 of the ESOS Act. The suspension or cancellation itself is the trigger. A stated intention to resume teaching later does not stop the default from arising for the period in which delivery is prevented.

This is the limb that catches early decision-makers off guard. Regulatory action short of closure — the college is still a legal entity, still enrolled students, still advertising — can still produce a provider default for the affected course and location.

When is a stopped course not provider default?

Two carve-outs are worth knowing before you assume the label applies.

The student defaulted first. Under section 46A(3), a provider does not default if it fails to start, or the course ceases, because the student defaults in relation to the course under paragraph 47A(1)(c). The same factual event — no teaching happening — is classified by its cause. If the breakdown traces back to the student's own default, the protections attached to provider default are not engaged.

The provider changed legal form. Under section 46A(4), if the registered provider for a course at a location has changed to become an entity of a different kind, the ESOS agency for the provider may notify the provider in writing that the course is not taken to have ceased merely because of that change. In deciding whether to give that notice, section 46A(5) requires the agency to have regard to the effect of the change on course delivery and student outcomes, any advice from another ESOS agency, and — for approved school providers — any advice of the State designated authority. A restructuring is therefore not automatically a default; it is assessed.

What follows once a provider default exists?

The section 45 guide to that Part sets out the ladder. Division 2 imposes refund obligations on registered providers, and in a provider default case the provider may instead offer affected students alternative courses at the provider's own expense. If the provider defaults and fails to discharge those Division 2 obligations, Division 3 requires the TPS Director to provide the student with options for suitable alternative courses, if any such courses are available. Division 4 allows payments out of the Overseas Students Tuition Fund (OSTF) to refund students and to reimburse providers that place students in alternative courses — described in the Act as making a call on the OSTF.

The practical shape: the college is first responsible, the Tuition Protection Service Director is the fallback for placement, and the OSTF is the fund behind both.

How fast must the college report it, and what must the notice say?

Section 46B(1) requires a registered provider that has defaulted in relation to one or more overseas students or intending overseas students to give notices under that section. Under section 46B(2), the provider must notify, in writing, both the ESOS agency for the provider and the TPS Director within 3 business days of the default occurring — with "business day" taking its meaning from section 2B of the Acts Interpretation Act 1901.

Section 46B(3) fixes the minimum content of that notice:

the circumstances of the default;
the details of the students in relation to whom the provider has defaulted;
advice on whether the provider intends to discharge its obligations to those students under section 46D, and, if appropriate, how it intends to do so.

Section 46B(4) separately requires the provider to notify the affected students in writing, and section 46B(5)–(6) allow the Minister to specify further notice requirements by legislative instrument. A breach of section 46B can itself expose the provider to action by its ESOS agency under Division 1 of Part 6.

Where prepaid tuition sits while all this is decided

Section 29 governs money taken before a student begins. A provider that receives tuition fees for a course before the student has begun must pay them into an account maintained under section 28 within 5 business days of receiving them. The balance must at all times hold a "protected amount" sufficient to repay all tuition fees to every student who has paid and has not yet begun the course.

Withdrawals that would push the balance below the protected amount are permitted only for narrow purposes: paying a refund under section 46D, 47D or 47E; paying an alternative provider where the student is offered a place at the provider's expense under section 46D; or paying the TPS Director under section 50C. Section 29(6) adds that the protected amount is not available to pay a provider's creditors and is not liable to be attached or taken in execution by a court at a creditor's instance, other than as set out in subsection (4). Once a student begins the course, their fees stop forming part of the protected amount.

How an early decision-maker can use this

Assume an applicant comparing two colleges of similar price. The question the ESOS Act invites is not "is this college popular?" but "what happens to the definition if delivery stops?" Because default attaches to a course at a location, and because a Part 6 sanction triggers it independently, the useful signals before enrolling are the specific campus and course being offered, whether the provider is current on CRICOS registration for that location, and what the written agreement says about the agreed starting day. Those three facts decide which limb of section 46A applies later.

Frequently Asked Questions

Is a delayed start date automatically provider default?

Not automatically, but section 46A(1)(a)(i) asks whether the provider failed to start providing the course at the location on the agreed starting day. If delivery does not begin on that day and the student has not withdrawn, the first limb is met.

If I withdraw before the course stops, is it still provider default?

No. Section 46A(1)(b) requires that the student has not withdrawn before the default day. Withdrawing earlier moves the situation toward student default rather than provider default.

Does a regulatory suspension count even if the college says it will reopen?

Yes. Section 46A(2) states that a provider defaults where it is prevented from providing a course at a location because a Part 6 sanction has been imposed. The prevention is the trigger, not the permanence of the closure.

What is the difference between provider default and student default?

Provider default concerns the provider failing to start or finish delivering the course. Section 46A(3) makes clear that where the failure or cessation happens because the student defaults under paragraph 47A(1)(c), the provider does not default.

How quickly must the college notify, and to whom?

Within 3 business days of the default, the provider must notify in writing both its ESOS agency and the TPS Director, and must separately notify the affected students in writing. The notice must cover the circumstances of the default, the student details, and whether and how the provider intends to meet its section 46D obligations.

Do I get a refund or another course after provider default?

Under the section 45 guide, a defaulting provider must meet refund obligations under Division 2, and may instead offer alternative courses at its own expense. If it fails to discharge those obligations, the TPS Director must provide options for suitable alternative courses where any are available, and the OSTF may be called on to fund refunds and reimbursements.

Can a college's creditors take my prepaid tuition?

Section 29(6) provides that the protected amount held for students who have not yet begun is not available to pay a creditor's debt and is not liable to be attached or taken in execution by a court at a creditor's instance, other than for the permitted withdrawals in section 29(4).