The Johor government has issued a cessation order to Network School at its Forest City site after discovering one of its premises was operating without a valid business licence. Johor Chief Minister Onn Hafiz Ghazi stated that the Iskandar Puteri City Council (MBIP) issued an enforcement notice for the unlicensed premises and an advertising licence notice for non-compliant signboards.

Onn Hafiz wrote on Facebook, “The inspection found that the company operates at two premises, where one premise has a valid business office licence, while the other premise was found to be operating without an MBIP business licence even though it is owned by a local citizen.”

Following the licensing issues, Onn Hafiz called for a comprehensive investigation involving the ministry, Immigration Department, police, Customs Department, and other security agencies to verify the identities and nationalities of those associated with Network School. The Immigration Department reported inspecting 266 foreigners from 40 countries, confirming valid documentation but continuing further checks for compliance.

Balaji Srinivasan, the American investor behind Network School, disputed reports of a shutdown on Saturday, July 18, 2026, stating the organisation received two notices and would have a “remedial period for both issues.” He also announced a halt on further investment and a planned RM500 million (US$122 million) expansion amid the probe.

Balaji expressed willingness to negotiate with Malaysian Prime Minister Anwar Ibrahim, saying, “If Malaysia wants such investment, then I would like to seek a meeting with Anwar to negotiate terms for a memorandum of understanding for Network School to continue its operations and investments in the country.”

A Network School sign was photographed at Forest City on July 16, 2026, underscoring the ongoing presence of the organisation despite the regulatory actions.

Sources