INTERNATIONAL

COMMERCIAL DISPUTE
RESOLUTION IN
VIETNAM
Group 9
 Pham Thi Phuong Mai
Dao Phuong Mai
Phan Thuy Trang

Members
Bui Thi Quynh Anh
Dao Xuan Minh
Vo Duc Anh
TEAM 9 Ngo Thi Minh Phuong
Tran Ngoc Bao Tram
Le Hong Nhung
Le Hai Ha
TABLE OF CONTENT

OVERVIEW INTERNALTIONAL LESSON &

COMMERCIAL RECOMMENDATION
DISPUTE
RESOLUTION IN
VIETNAM

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OVERVIEW
International Commercial
Disputes

Definition of International Commercial

Disputes
Categories of International Commercial
Disputes
International Commercial Disputes
are conflicts arising when one of the
parties violates, or fails to perform, its
committed obligations in
international trade activities.

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Overview
Categories of International Commercial
Disputes

VIOLATION OF VIOLATIONS RELATED TO

OBLIGATIONS ARISING THE CONCLUSION AND
FROM BILATERAL AND PERFORMANCE OF
MULTILATERAL TRADE SPECIFIC TYPES OF
AGREEMENTS COMMERCIAL CONTRACTS

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INTERNALTIONAL
COMMERCIAL
DISPUTE
RESOLUTION IN
VIETNAM
Dispute resolution
Conciliation
Conciliation is a method of dispute resolution
with the participation of a third party as a
conciliator to assist and persuade the
disputing parties to find solutions to
eliminate the arising dispute.
 1. Conciliation Agreement
Dispute 2. Appointment of conciliator

resolution
3. Rights and obligations of the disputing
parties in the conciliation process
4. Order and procedures for conciliation
Conciliation 5. Conciliated Settlement Agreement
6. Conciliated Settlement Agreement
Procedure
recognition
7. Termination of conciliation process

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 Conciliation
Advatages Disadvantages
Time-saving Delivering injustice.
Low cost Depends on the
Have the right to choose agreement of the parties
conciliator/location Not mandatory
Little harm to the
cooperation between two
sides
Confidential
Dispute resolution
Arbitration
Arbitration is a private dispute resolution
process that parties may choose as an
alternative to going to court.
 In Vietnam today, arbitration is being widely
applied. The Vietnamese government has
established the Vietnam International Arbitration
Center (VIAC).

Overview VIAC is a non-governmental organization

in competent to settle disputes arising from

international economic relations.

Vietnam
The reality of international trade in Vietnam
shows that every year the number of disputes
resolved by international arbitration in Vietnam is
increasing.
 The beginning of the arbitration involves one
party giving notice to another of their intent to
arbitrate a dispute
Dispute The other party then gets a period of time to

resolution respond in writing, indicating whether they

agree to resolve this dispute via arbitration

Arbitration The arbitration process itself begins, based on

the rules and procedures selected by the
Process parties or specified by contract.

Both sides provide evidence. After judgments,

award implementation will be recognised.

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 Arbitral proceedings
and an arbitral award
are more confidential
and flexible

Arbitration Arbitration is often faster

than litigation in court
Advantages

Arbitral awards are

mostly final
Not public

Arbitration
Cost
Disavantages

Arbitration decision
cannot be easily
overturned
 CASE 1:

Dispute resolution process for breach of

contract between company U and Steel
Company D through arbitration

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 Case 1
Parties
Claimant: U. Company (Philippines)
U
Respondent: D. Steel Joint Stock Company (Vietnam)

D
Third party (Arbitration): ICC

?
Case content
Company U (Requester) in the Philippines and Steel
Company D (headquartered in Vietnam) Sign a contract to
buy and sell 6000 tons of steel on 12/06/2017 with a contract
value of 2.430. 000 USD.
During the performance of the contract, D Steel Company
did not deliver the goods according to the quantity and time
limit specified in the Sales Contract.

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Case 1

1. 28/12/2017, Company U filed a lawsuit at the ICC

Arbitration 2. During the arbitration

+) The ICC has notified Company D about the appointment of

proceedings:
arbitrator, the arbitration proceedings and the content of the
claim of Company U.
+) There is only one arbitrator
Case 1
19/10/2018, ICC claim
+) The failure to deliver goods according to the correct
quantity and time limit stated in the contract of Company D
is a breach of the contract.
+) The judgment forces Company D to pay compensation for

Arbitration damage caused by the act of non-performance of the

contract, the compensation value is equal to the value of

proceedings: remedy the damage by compensating the purchase of similar

goods, with a smaller volume, at an almost equivalent cost

(Article 459 of the Civil Procedure Code and paragraph 5,

Article 5 of the 1958 New York Convention)
Case 1

On September 27, 2019, the People's Court of Da Nang City

opened a public first-instance court to resolve "Request for

Arbitration recognition and enforcement in Vietnam of business and

commercial judgments of foreign arbitrators" against with the

proceedings: dispute about breach of contract between company U and

Steel Company D
 Court declares:
1. Recognition and enforcement the Judgment of ICC on dispute settlement in
Vietnam.
2. The fee for dealing with business and commerce must be paid by Company U at
3,000,000VND
CASE 1: Company D has to pay compensation value is equal to
the value of remedy the damage by compensating the

Conclusion purchase of similar goods, with a smaller volume, at an

almost equivalent cost
Dispute resolution
Litigation
Litigation is the process of taking a dispute to a
court of law.

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Litigation
Process

LEGAL BASIS SETTLEMENT STATUTE OF

PROCESS LIMITATIONS FOR
Code of Civil
Procedure 2015 LAWSUITS
Lawsuit initiation and
Vietnam acceptance Within 2 year since the
Commercial Law Mediation and preparation legal rights and benefits
2005 for trial of the party are violated
First instance trial
Appeal trial

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 Litigation
Advatages Disadvantages

Precedent setting Costly

Clear evidence Time consuming
Compulsion of Damaging relationship
complying with the
judgements
 PARTIES

CASE 2: The dispute CASE CONTENT

in the contract sales

PROCESS
of goods was held
DECISIONS

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 Case 2
Parties
Plaintiff:
G
“G” Synchronous Generator Manufacturing Company;

N
(China)
“N” Investment and Development Joint Stock
Company (Vietnam)

Defendant :
“D” Construction and Materials Investment Joint
Stock Company (Vietnam)
(Abbreviation : DC)  
D
Case content
Company G and company N signed contract with
Company DC on the provision equipment and technical
services for LaLa hydropower plant. Company DC
(buyer) had to pay company G and company N $565.790
and $204.239 respectively

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 Executing contract:
- Last batch delivered in Oct 2012
- Oct 2012: Lala hydropower plant operated.
- Company DC just paid G Company 95% of
contract value; paid Company N 90% of the
contract value
- Nov 2012 - Apr 2013: G-N repeatedly
requested company DC to perform its
obligations
=> DC avoided and refused to pay debts
Process
The litigation
lasted for 6 years,
from 2014 to 2020
Forcing Company DC to make the
payment to Company G without

interest and to Company N with

interest.
Company G has an appeal

NOVEMBER 2, 2015

O C T O B E
R 3 1 , 2 0 1 4 OCTOBER 19, 2016

Company G and company N filed a lawsuit asking It was decided to cancel the first-instance
Company DC to make payment with interest of judgment and transfer the case file to the
15,5%/year first-instance Court for re-settlement.
Process
Forcing Company DC to make the payment to Company The defendant Company
G without interest and to Company N with interest. DC filed an appeal against
Forcing Company G and company N pay the repair cost paying interest to
for company DC Company N.

NOVEMBER 28, 2019 DECEMBER 10, 2019

OCTOBER 2, 2017 NOVEMBER 28, 2019 JULY 21, 2020

Company DC did
not continue to pay due to:

Plaintiff Company G filed
G-N did not fulfill their obligations The final
an appeal requesting that
DC Company suffered the delay of the judgment
Company DC pay interest
acceptance and finalization of the project had been
from November 1, 2012 to
Company DC asks Company G to pay for repair of made.
the date of the first
machinery and equipment during the warranty
instance trial.
period, but G does not provide warranty
Company DC agreed to pay Company G and
Company N with no interest.
Decisions
COURT DECISIONS:

Rejecting the appeal of company G and company DC

Forcing DC to pay G 1,310,199,903 VND
Forcing DC to pay N 508,624,683 VND
(Principal: 242,544,102 VND; Interest amount: 266,080,581 VND)
Rejecting the lawsuit filed by G requesting DC to pay the
interest of 1,437,362,086 VND.
Legal fees for appellate commercial business 2,000,000 VND
Other decisions of the first-instance judgment.

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 RECOMMENDATION

Commercial disputes can be lengthy and costly. Having a

clear and definitive dispute resolution plan can reduce the
time and cost involved in commercial

disputes. It can also
reinforce confidence in the success of the transaction
because it reduces uncertainties that make investors nervous.
RECOMMENDATIONS
Carry out research and
due diligence
When a new business opportunity arises, it’s
easy to assume the best and jump into an
agreement knowing very little about the
people running the business and their
reputation.
Carefully consider any
limitations on liability
Limitations of liability can either refer to
specific events and state that there will be no
liability for them, exclude all warranties unless
they are specified in the contract or exclude
legal claims based on misrepresentation.
Clear and understandable
agreements
The more room for subjective interpretation
in contracts, the higher the risk that the
counterparty will take advantage of ambiguity
for their own gain.
Keep all relevant
documentation
It’s important to adopt a no-destruction
policy on all relevant documentation and to
ensure everyone involved in the contract
does the same.
While litigation has been the traditional way
of dealing with disputes, there are strong
reasons to consider alternative dispute
resolution (ADR).
ADR is frequently a much cheaper way to
resolve disputes than litigation. Its methods
are also faster, involve more intense
resolution of the disputes, and can often be
resolved by more creative settlements than
those offered by litigation.

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Vietnamese the judicial system is somewhat
lacking in experience and development of
complex commercial litigation skills and
procedures. Lengthy and complicated
judicial procedures also discouraged people
to seek judicial remedies.
However, the Vietnamese judicial system
has been undergoing substantial
reorganization and has developed very
rapidly.
THANKS!
Q&A PART

Group 9