STATE BANK OF VIETNAM

References
BANKING UNIVERSITY OF HO CHI MINH CITY
 Learning Resources
• Mai Hong Quy, Introduction to Vietnamese Law,
Hong Duc Publishing House, 2013;
• Pham Duy Nghia, Essential Elements of Business Law
BUSINESS LAW in Vietnam, The Gioi Publisher, 2001;
• Le Net, Contract Law in Vietnam, Wolter Klower,
LAM To Trang, Ph.D 1999 ;
• ……..

1 2

Reference Contents
 Legal documents Chapter 1. Introduction to Law
• Constitution 2013; Chapter 2. Civil Law
• Civil Code 2015;
Chapter 3. Contract Law
• Civil Procedure Code 2015;
• Labor Code 2019; Chapter 4. Law on Business Organizations
• Law on Enterprises 2014, 2020; Chapter 5. Commercial Law
• Commercial Law 2005;
Chapter 6. Business-related Dispute Resolutions
• Law on Competition 2018;
• Law on Intellectual Property 2005, amended and Chapter 7. Labor Law
supplemented in 2009, 2019; Chapter 8. Intellectual Property Law
• ……..
Chapter 9. International Law
3 4

1.1 The State of Vietnam

Chapter 1. Introduction to Law
The State of Vietnam is a system of national organs.
1.1. Overview of Vietnamese State Democratic centralism is the principle governing all state
organs.
1.2. Overview of Legal System in Vietnam
1.3. Overview of Legal System in the World

5 6

1
 1.1 The State of Vietnam National Assembly
The National Assembly is the highest representative
Structurally, the State of Vietnam consists of: body of the People and the highest state power body of
 National Assembly; the Socialist Republic of Vietnam (Article 69 Constitution
2013).
 President;
The National Assembly is the only body that has the
 Government; supreme supervisory power over the implementation of
 People’s Court; the Constitution and the laws.
 People’s Prosecution. The duration of each National Assembly is five years.

7 8

National Assembly
National Assembly
Along with legislative functions, the National Assembly
exercises supreme control over conformity to the The organ of the National Assembly:
Constitution, the law and the resolutions of the National
Assembly.  The Standing Committee of the National Assembly is
the permanent body of the National Assembly (Article
The National Assembly also decides fundamental 44);
matters of the nation, including socio-economic
development, financial and monetary policies, issues of (Law on Organization of the National Assembly 2014,
war and peace, national defense and security, and Amended and Supplemented in 2020)
external relations.
(Article 70 Constitution 2013)

9 10

National Assembly
 The Ethnic Council and nine Committees of the National
Assembly (Article 66):
• Law Committee;
• Judicial Committee;
• Economic Committee;
• Finance and Budget Committee;
• National Defense and Security Committee;
• Committee for Culture, Education;
• Social Committee;
• Science, Technology and Environment Committee;
• External Affairs Committee
(Law on Organization of the National Assembly 2014, (Law on Organization of the National Assembly 2014,
Amended and Supplemented in 2020) 11 Amended and Supplemented in 2020) 12

2
 1.1 The State of Vietnam

Structurally, the State of Vietnam consists of:

 National Assembly;
 President;
 Government;
 People’s Court;
 People’s Prosecution.
http://quochoi.vn/Pages/default.aspx

13 14

President 1.1 The State of Vietnam

The President is the Head of the State. As the chief of the
State, the President represents the State internally and Structurally, the State of Vietnam consists of:
externally.
 National Assembly;
The President is elected by the National Assembly from
among its members for a term of five years.  President;

In addition to playing a key role in the internal and  Government;

external relations, the President also has certain rights in  People’s Court;
the legislative, executive and judicial fields.  People’s Prosecution.
The President has power to grant pardon.

15 16

Government
The Government is the executive organ of the National
Assembly, the highest organ of State administration of
the Socialist Republic of Vietnam (Article 94 Constitution
2013).
The term of the Government follows the term of the
National Assembly of five years (Article 97 Constitution
2013).
17
Government
The duties and power of the Government are provided in
Article 96 of the 2013 Constitution.
One of the powers of the Government is organizing the
implementation of the Constitution, laws and resolutions
of the National Assembly, ordinances and resolutions of
the Standing Committee of the National Assembly, and
orders and decisions of the President.
As for the administration of laws, the Government shall
also carry out overall management of the work for the
fulfillment of the political, economic, cultural, social,
national-defence, security and external duties of the
State.
18

3
 Government CHÍNH PHỦ
THỦ TƯỚNG

The Government shall be composed of the Prime

THỦ TƯỚNG,
Minister, the Deputy Prime Ministers, the Cabinet
CÁC PHÓ THỦ TƯỚNG
Ministers, and other members (Article 95 Constitution PHÓ THỦ TƯỚNG

2013).
BỘ CƠ QUAN NGANG BỘ
BỘ TRƯỞNG THỦ TRƯỞNG

http://www.chinhphu.vn/portal/page/portal/chinhphu/trangchu
19 20

Government CƠ QUAN NGANG BỘ

VĂN NGÂN
Prime Minister PHÒNG HÀNG ỦY BAN
DÂN TỘC
THANH TRA
CHÍNH PHỦ
CHÍNH NHÀ
PHỦ NƯỚC

Ministry Ministerial-Level Agency CHỨC DANH

CỦA NGƯỜI
ĐỨNG ĐẦU

http://www.chinhphu.vn/portal/page/portal/chinhphu/trangchu

21 22

CƠ QUAN THUỘC CHÍNH PHỦ People’s Council and

People’s Committee
VIỆN
BAN VIỆN
HỌC HÀN
QUẢN
BẢO VIỆN LÂM
HÀN  People’s Council
ĐÀI ĐÀI LÝ LÂM
HIỂM THÔNG CHÍNH KHOA
TIẾNG
NÓI
TRUYỀ
N HÌNH
LĂNG
CHỦ
XÃ TẤN XÃ TRỊ HỌC
KHOA
HỌC
 People’s Committee
HỘI VIỆT QUỐC VÀ
VIỆT VIỆT TỊCH XÃ
VIỆT NAM GIA CÔNG
NAM NAM HỒ HỘI
NAM HỒ CHÍ NGHỆ
CHÍ VIỆT
MINH VIỆT
MINH NAM
NAM

23 24

4
 People’s Council
The People’s Council is the local organ of State power.
The People’s Council represents the will, aspirations, and
authority of the People.
The People’s Council is elected by the local population
and is accountable to them and to the superior State
organ.
The People’s Council is the center for guiding and
operating decisions of the decisions of higher state
organs. It is also the centre to co-ordinate activities of all
local organs.
(Article 113 Constitution 2013).
25
People’s Committee
The People’s Committee is the local executive body.
The People’s Committee elected by the People’s Council
is the latter’s executive organ, the organ of local State
administration.
The People’s Committee is its responsibility to
implement the Constitution, the law, the formal written
orders of superior State organs, and the resolutions of
the People’s Council.
(Article 114 Constitution 2013).
26

1.1 The State of Vietnam People’s Court

The People’s Courts are the judicial bodies of the
Structurally, the State of Vietnam consists of: Socialist Republic of Vietnam and exercise judicial power
 National Assembly; (Article 102 Constitution 2013).
 President; The major function of courts is adjudicative. These
courts are uniquely vested with the judging function in
 Government;
criminal, civil, administrative cases and other cases
 People’s Court; stipulated by the law.
 People’s Prosecution.

27 28

People’s Court People’s Court

The Vietnamese courts are divided geographically into
allocated regional administrations (such as Provincial and
District People’s Courts) hierarchically into original and
appellate jurisdiction, and into specialized subject
matters (such as criminal, civil, administrative, economic,
labor, family and juvenile tribunals).
Organization of people’s courts”
• The Supreme People’s Court.
• Superior people’s courts.
• Courts of provinces and centrally run cities.
• Courts of rural districts, urban districts, towns,
provincial cities and the equivalent.
• Military courts.
(Article 3 Law on Organization of People’s Court)

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5
 1.1 The State of Vietnam People’s Prosecution
The People’s Procuracies shall exercise the power to
Structurally, the State of Vietnam consists of: prosecute and supervise judicial activities (Article 107
Constitution 2013).
 National Assembly;
 President;
 Government;
 People’s Court;
 People’s Prosecution.

31 32

People’s Prosecution BỘ MÁY NHÀ NƯỚC

The people’s procuracy system: CQ QUYỀN CQ HÀNH NGUYÊN THỦ CQ TƯ

CQ XÉT XỬ
• The Supreme People’s Procuracy. LỰC PHÁP QUỐC GIA PHÁP

• Superior people’s procuracies. CHÍNH CHỦ TỊCH

QUỐC HỘI TAND VKSND
• People’s procuracies of provinces and centrally run cities PHỦ NƯỚC
(below referred to as provincial-level people’s
HĐND UBND TAND VKSND
procuracies). CÁC CẤP CÁC CẤP CÁC CẤP
CÁC CẤP
• People’s procuracies of rural districts, urban districts,
towns, provincial cities and the equivalent (below referred
to as district-level people’s procuracies).
• Military procuracies at different levels.
(Article 40 Law on Organization of People Procuracies )

33

1.2. Vietnamese Legal System

Chapter 1. Introduction to Law
1.1. Overview of Vietnamese State
1.2. Overview of Legal System in Vietnam
1.3. Overview of Legal System in the World
There are two concepts which need to be considered
and distinguished:
 Legal system refers to the internal structure of law.
 Legal document system refers to the external
structure of law.

35 36

6
 Legal structural system
1.2. Vietnamese Legal System
The Legal structural system is the whole of the legal
 Legal structural system norms that are expressed in legal documents and
promulgated by compulsory procedures and jurisdiction.
 Normative legal documents system
These legal norms have an internal relation and form a
 Sources of law coherent whole, being combined to constitute law
institutions and law branches.

37 38

Legal structural system

Legal norms are the smallest unit in the structure of the
Legal structural system
legal system, promulgated or recognized by an authority
Legal institutions are the second element of the legal
or authorities. Legal norm are the rules of conduct that
system, including all legal norms that have the same
are applied to regulate social relations.
features and regulate a group of correlative social
Legal norms should be general because they may be relations.
applied for every case every subject but, simultaneously,
Having a group feature, the legal institutions are usually
legal norms should also be specific because they are rules
defined so as to build an appropriate legal norm system in
and standards applied for particular cases which are
order to classify social fields to which law may apply.
predicted or prepared beforehand. To achieve this end, a
legal norm should be presented clearly, exactly, and with
one meaning.
39 40

Legal branches
Legal branches are a system of legal norms (which are
classified into legal institutions) to regulate a sort of certain 1.2. Vietnamese Legal System
social field such as civil, criminal or administrative, etc.
According to the popular division of law branches in the legal  Legal structural system
system, Vietnam has more than ten branches, namely has the  Normative legal documents system
Branch of Constitutional Law, the Branch of Administrative
Law, the Branch of Criminal Law, the Branch of Criminal  Sources of law
Procedure Law, the Branch of Civil Law, the Branch of Civil
Procedure Law, the Branch of Marriage and Family Law, the
Branch of Labour Law, the Branch of Economic Law, the
Branch of Land Law, the Branch of Financial Law, the Branch of
Banking Law...
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7
 Normative legal documents system Normative legal documents system
No Type of Document Authority
In the Vietnamese legal system, the system of normative 1. Constitution, Code, National Assembly
legal documents is all legal documents that are Law, Resolution
promulgated by the state. This is one of sources of law 2. Ordinance, Standing Committee of the National
Resolution Assembly
that is recognized in Vietnam.
3. Order, Decision President
Normative legal documents are divided into two kinds: 4. Decree Government
 Law documents: normative legal documents that are 5. Joint Resolution Standing Committee of the National
Assembly and Management Board of Central
issued by the National Assembly. Committee of Vietnamese Fatherland Front
Standing Committee of the National
 Subordinate law documents: normative legal Assembly, Government and Management
documents that are issued by other bodies or persons Board of Central Committee of Vietnamese
in authority. Fatherland Front
(Article 4 Law on the Promulgation of Legal Documents 2015,
43 Amended and Supplemented in 2020) 44

Normative legal documents system

No Type of Authority
Document Normative legal documents system
6. Decision Prime Minister
7. Resolution Judge Council of the People’s Supreme Court
No Type of Document Authority
8. Circular - Executive judge of the People’s Supreme Court
- Chief Procurator of the Supreme People’s Procuracy 10. Decision State Auditor General
- Ministers, Heads of ministerial agencies 11. Resolution People’s Council
- State Audit General 12. Decision People’s Committee
9. Joint - Executive judge of the People’s Supreme Court and
Circular the Chief Procurator of the Supreme People’s
Procuracy (Article 4 Law on the Promulgation of Legal Documents 2015,
- Ministers, Heads of ministerial agencies and Amended and Supplemented in 2020)
executive judge of the People’s Supreme Court, the
Chief Procurator of the Supreme People’s Procuracy

(Article 4 Law on the Promulgation of Legal Documents 2015,

Amended and Supplemented in 2020) 45 46

1.2. Vietnamese Legal System

1. Constitution, Code, Law, Resolution 1.2. Vietnamese Legal System
2. Ordinance, Resolution
3. Order, Decision  Legal structural system
4. Circular  Normative legal documents system
5. Joint Circular  Sources of law
6. Decree
7. Joint Resolution
8. Decision
9. Resolution

47 48

8
 1.2. Vietnamese Legal System
Sources of law in Vietnam are defined as all fundamental
or basic elements used by authorized entities for
developing, promulgating, interpreting a laws as well as
for applying in dealing with a specific case in practices.
49
State Law
State law means the legal documents issued by the
authorities in Vietnam. Legal documents are the main
source of Vietnamese law, include mainly written laws.
Legal documents are documents that contain legal
regulations and the promulgation of which complies with
regulations of law on authority, manner, and procedures
provided for in the law (Article 2 of 2015 Law on
Promulgation of Legal Documents).
For example, the Constitution, the Civil Code, etc.
51
Precedents
In the past, judicial precedents were not defined as a
source of law. However, Supreme Court has published
material on the way it has dealt with cases and involved in
training judges in interpreting laws. Supreme Court holds
power to issue circular for providing guidelines on
implementation of particular law for lower court. This
circular is defined as a source of law.
53
1.2. Vietnamese Legal System
Sources of law are divided into three major types:
 State Law
 Customary Law
 Precedents
50
Customary Law
Customary law means rules of conduct obviously to define
rights and obligations of persons in specific civil relations,
forming and repeating in a long time, recognized and applying
generally in a region, race, or a community or a field of civil
(Article 5.1 of the 2015 Civil Code).
Customary law is adopted as a source of law if it is used to
deal with specific case in reality. Vietnam defines customary
regulations as a source of law in some legal documents .
For example, Article 5 of the 2015 Civil Code confirm that: “In
cases where it is neither provided for by law nor agreed upon
by the parties, practices may apply…”
52
Precedents
However, since the end of 2015, precedents were
considered as a source of law. According to Article 1 of
Resolution no 04/2019/NQ-HDTP of the Council of
Justices of the Supreme People’s Court, dated on 28
October 2015, on process for selecting, publishing, and
adopting precedents, precedents are arguments and
rulings written on effective judgments or decisions
(hereinafter referred to as judgment) of the courts that
are selected by the Council of Justices of the Supreme
People's Court and published by the Chief Justice of the
Supreme People’s Court in order for other courts to study
and adopt them when deciding later cases.
54
9

Chapter 1. Introduction to Law
1.1. Overview of Vietnamese State
1.2. Overview of Legal System in Vietnam
1.3. Overview of Legal System in the World
55
Civil Law
 It is a legal system inspired by Roman law, the primary
feature of which is that laws are written into a
collection, codified, and not determined, as in common
law, by judges.
 The principle of this system is to provide all citizens
with an accessible and written collection of the laws
which apply to them and which judges must follow.
 It is the most prevalent and oldest surviving legal
system in the world.
 Continental legal system is sometimes inappropriately
referred to as Roman law or otherwise called Romano-
Germanic law, especially by people under its
jurisdiction.
57
Socialist Law
 Socialist law is the official name of the legal system
used in Communist states. It is based on the civil law
system, with major modifications and additions from
Marxist-Leninist ideology.
 Prior to the end of the Cold War, Socialist law was
generally ranked among the major legal systems of the
world.
 However, many contemporary observers no longer
consider it to be such, due to similarities with the civil
law system and the fact that it is no longer in
widespread use following the dismantling of most
communist states.
59
Overview of Legal System in the World
 There are some legal systems of the world today which
consist of:
• Continental European legal system (civil law)
• Anglo-American legal system (common law)
• Socialist legal system
• Religious legal systems
• Mixed legal systems
 Each country often develops variations on each system
or incorporates many other features into the system.
56
Common Law
 Common law is law developed by judges through
decisions of courts and similar tribunals (called case
law), rather than through legislative statutes or
executive action, and to corresponding legal systems
that rely on precedential case law.
 Common law legal systems are in widespread use,
particularly in England where it originated in the
Middle Ages, and in nations that trace their legal
heritage to England as former colonies of the British
Empire, including the United States, Singapore,
Pakistan, India, Ghana, Cameroon, Canada, Ireland,
New Zealand, South Africa, Hong Kong and Australia.
58
Religious Legal System
 Religious law refers to the notion of a religious system
or document being used as a legal source.
 The main kinds of religious law are Sharia in Islam,
Halakha in Judaism, and Canon law in some Christian
groups.
60
10
 Mixed Legal System
 Mixed legal systems are mostly defined as the
combination of civil law and common law.
 Examples - South Africa, Louisiana, Israel.
 Israel's legal system combines English common law, civil
law, and Jewish law.
 Legal enclaves – territories surrounded by different
legal culture.

61

11
 Content
Chapter 2. Civil Law
Chapter 1. Introduction to Law
Chapter 2. Civil Law The main source of civil law in Vietnam is the
Chapter 3. Contract Law Vietnamese Civil Code. Until now there are three Civil
Codes as follows:
Chapter 4. Law on Business Organizations
 Civil Code 1995
Chapter 5. Commercial Law
 Civil Code 2005
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law  Civil Code 2015

Chapter 8. Intellectual Property Law

Chapter 9. International Law

1 2

Chapter 2. Civil Law

2.1. General Provisions
2.1. General provisions
General Provisions in the Civil Code 2015 covers many
2.2. Property and ownership rights chapters and sections that provide general principles and
2.3. Civil obligations provisions, as well as legal status of individuals, legal
persons, and other entities when entering into civil
2.4. Compensation of non-contractual damages
transactions.
2.5. Law of tort

3 4

2.1. General Provisions Subjects of Civil Relations

 Subjects of civil relations  Individuals
 Representation in civil relations  Legal entities

5 6

1
 Individuals Individuals’ Capacity
 Individuals’ capacity In order to ensure the validity of civil transactions, the
individuals have to have:
 Individuals’ rights
 Civil legal capacity; and
 Civil act capacity

7 8

Civil Legal Capacity Civil Legal Capacity

 The legal capacity of a natural person is his/her  The civil legal capacity of a natural person shall not be
capability to have civil rights and civil obligations. restricted, unless otherwise provided for by law.
 All individuals have the same legal personality. (Article 18 of CC 2015)
 The legal capacity of a natural person begins at birth
and terminates at death.
(Article 16 of CC 2015)

9 10

Civil Act Capacity

Civil Act Capacity
 The civil act capacity of a natural person is his/her
capability to establish and exercise civil rights and
perform civil obligations through his/her acts (Article
19 of CC 2015).
 The civil act capacity is one of the conditions for the
validity of a civil transaction.
11
 Minors who are under eighteen years of age don’t have enough
capacity to carry out civil acts.
 Persons under six years of age don’t have the capacity for any
civil acts. All transactions of these persons must be established
and carried out by their legal representative.
 Minors who are from six to under fifteen years of age must
have the permission of their legal representative to enter into
civil transactions, except for transactions with a small value and
to meet their daily life.
 Persons who are from fifteen to under eighteen years of age
can make and perform civil transactions by himself/herself,
except for civil transactions related to real estate, movable
property requiring registration and other civil transactions
prescribed by law that are subject to the consent of his/her
legal representative.
(Article 21 of CC 2015)
12

2
 Civil Act Capacity
 Persons who a court has declared to have lost their civil
act capacity due to mental or illness do not have the
capacity for civil acts.
 As these person are unable to aware or control their
own acts, in order to protect their legal rights and
interest when they enter into a civil relation, all civil
transaction of person who have lost their capacity for
civil act must be made and performed by their legal
representation.
(Article 22 of CC 2015)
Civil Act Capacity
 Based on the opinion of forensic-psychiatric
examination by any authorized organization, a court
shall issue a decision to declare an adult with limited
cognition or behavior control due to his/her physical or
spiritual condition (Article 23.1 of CC 2015).
 Civil transactions of these person must be made and
performed by their legal representation if they are
unable to aware or control their own acts.

13 14

Civil Act Capacity

 Person who have restricted capacity for civil acts due to Individuals
drug or other stimulants addicted, or who have ruined
their own or their family property, may have their  Individuals’ capacity
capacity for civil acts restricted by a court decision.
 Individuals’ rights
 A court will appoint a legal representative for persons
who have restricted capacity, as well as determine the
scope of representation. In order to enter into civil
transactions related to their property, these persons
must have the consent of their legal representative,
except for transactions of small value and to meet the
need of daily life.
(Article 24 of CC 2015)
15 16

Individuals’ rights Property rights

Individuals’ rights are divided into two different groups:  Property rights is the rights associated with property.
 Property rights For example, ownership rights, inheritance rights, etc.
 Personal rights

17 18

3
 Personal rights
 There are personal rights not associated with property,
and personal rights associated with property.
 Regarding personal rights, compared to the Civil Code
2005, right to change the sex have been provided for
the first time in the Civil Code 2015 (Article 37 of CC
2015). This is not only considered as an individual right
but also a human right. This right allows a person to live
normally with the gender which they wish.
19
Legal Entities
 The Civil Code 2015 has no definition on legal entities;
instead, this Code provides the requirements that an
organization must meet in order to be recognized as a
legal entity.
21
Legal Entities
The conditions are as follows:
 That the organization has property independent from
other individuals and organizations, and it fulfills
voluntarily obligations by recourse to such property.
Independent property is the key element that allow an
organization take part into civil transactions and fulfill
obligations.
 That the organization participates independently in
legal relations in its own name. When taking part in
civil transactions, the organization must operate
indecently from its founders, regardless of whether the
founders are individuals or organizations.
23
2.1. General Provisions
 Individuals
 Legal entities
20
Legal Entities
The conditions are as follows:
 That the organization was legally established. There are
many way through which organizations can be
established. However, only organizations that were
lawfully formed under the procedures proscribed by
law are accepted.
 That the organization has an operational structure. The
organizational structure is one of the most important
elements to ensuring that the organization could
operate smoothly. The departments of the company,
for instance, are crucial to development and day-to-day
operation.
22
Legal Entities
When an organization meets all above-listed conditions, it
will be recognized as legal entity. A legal entity must bear
civil liability with respect to the actions and obligations
established and performed in the name of legal entity by
its representative.
24
4
 Legal Entities
2.1. General Provisions
Together with individuals and legal entities, under the
Civil Code 2005, family households and cooperative  Subject of civil relations
groups are also the subject of civil relations law in certain  Representation in civil relations
situations. But, now, they are not in scope of the Civil
Code 2015 (Article 1 of CC 2015).

25 26

Representation
Representation means a person (hereinafter referred to
as the representative) acting in the name and for the
benefit of another person (hereinafter referred to as the
principal) enters into and performs a civil transaction
within the scope of representation (Article 134.1 of CC
2015).
Representation
 Authorized representation: Representation rights shall
be established according to a power of attorney
between a principal and a representative;
 Legal representation: Representation rights shall be
established according to a decision of a competent
authority, a charter of a legal person or as prescribed
by law.
(Article 135 of CC 2015)

27 28

Chapter 2. Civil Law

2.2. Property and ownership rights
2.1. General provisions
 Property
2.2. Property and ownership rights
 Ownership rights
2.3. Civil obligations
2.4. Compensation of non-contractual damages
2.5. Law of tort

29 30

5
 Property Property
Property comprises objects, money, valuable papers and Property can be immovable or movable.
property rights (Article 105 of CC 2015).  Immovable property includes:
 Objects can be future property. • Land;
 Value papers means shares, checks… that are specified • Houses and constructions attached to land;
by law, can be monetized, and allowed to be • Other property attached to land, houses and
transferred. constructions;
The classification of properties plays a significant role • Other property as prescribed by law.
when subjects have to establish and perform their  Moveable property is property which is not immovable
obligations. property.
(Article 107 of CC 2015).
31 32

Ownership rights Ownership rights

Ownership rights comprise the rights of owners to
possess, use, and dispose their property in accordance
with law (Article 158 of CC 2015).
The owner shall be entitled to conduct all acts permitted
by an owner with respect to property, but may not cause
damage to or adversely impact the interests of the state,
the pubic interest, or the lawful rights and interest of the
other (Article 160.2 of CC 2015).
Ownership rights to immovable property shall be
registered in accordance with Civil Code 2015 and law on
registration of property.
Ownership rights to movable property shall not be
required to be registered, except where otherwise
provided by law.
(Article 106 of CC 2015)

33 34

Ownership rights
Under the Civil Code 2015, other property-related rights Chapter 2. Civil Law
are recognized at the first time.
 Right to adjoining immovable property means a right to 2.1. General provisions
be exercised on an immovable property (hereinafter 2.2. Property and ownership rights
referred to as obliged immovable property) to serve the
2.3. Civil obligations
exploitation of another immovable property under
ownership of another person (hereinafter referred to as 2.4. Compensation of non-contractual damages
entitled immovable property) (Article 245 of CC 2015). 2.5. Law of tort
 Surface rights mean an entity's rights to the ground,
water surface, space thereon and earth bowel of the
land whose land use rights belong to another entity
(Article 267 of CC 2015).
35 36

6
 Definition of Civil Obligations
Civil obligations means acts whereby one or more
2.3. Civil Obligations subjects (parties having obligations) must transfer
items/properties, rights, money, or valuable papers, or
 Definition of Civil obligations perform acts or refrain from performing certain acts in
 Types of Civil obligations the interest of one or more others subjects (parties
having rights).
Civil obligations raise from different grounds, such as
through the agreement between parties of civil contracts,
unilateral legal actions, or unauthorized performance of
acts, unlawful possessions of, use of, or receipt of benefit
from property, damage caused by unlawful acts, or from
other acts as provided by law.
37 38

Type of Civil Obligations

2.3. Civil Obligations According to Article 276 of Civil Code 2015, the object of the
civil obligation may be a property, or act that either must be
performed or must not be performed. Also, the object of a
 Definition of Civil obligations civil obligation must be defined precisely.
 Types of Civil obligations Based on object of civil obligations, such as the transfer of an
item, payment, performance/restrain from performance,
characteristic, and other particular features of each civil
obligation, there are different types of civil obligations. The
main aim of the division of types of civil obligation is to
indentify the specific purpose of each type of obligation, the
responsibilities of obligors, and the rights of the obligor’s
partners in certain circumstances.
39 40

Type of Civil Obligations

The followings are fundamental types of civil obligations: Type of Civil Obligations
 Performance of obligations to deliver objects (Article 279 of CC
2015: A person having the obligation to deliver an object must Besides these performances, there are other types of
take care of and preserve the object until the time of delivery) performances of civil obligations, such as conditional
 Performance of obligations to pay money (Article 280 of CC
2015): An obligation to pay money shall be performed in full,
performance, performance of having optional objects,
strictly on time, at the place and by the method as agreed performance of substitutable obligations, performance of
 Performance of obligations through third parties (Article 283 of severable obligations, performance of joint obligations,
CC 2015): Under some situations, an obligor is not able to performance of divisible obligations, and performance of
perform the obligation as agreed. With the consent of the
obligee, obligor may authorize a third party to perform the
indivisible obligation hindrance (Article 284 – 291 of CC
obligation on behalf of the obligor provided that the obligor 2015).
remains liable to the obligee if the third party fails to perform or
incorrectly perform the obligation as agreed. In other words, the
obligor’s responsibilities only terminate to obligee when the third
party has satisfactorily performed the obligations.
41 42

7
 Chapter 2. Civil Law
2.1. General provisions
2.2. Property and ownership rights
2.3. Civil obligations
2.4. Compensation of non-contractual damages
2.5. Law of tort
43
Definition of Non-Contractual Damages
In daily life, for different reasons, incident happens to many
different subjects and causes damage to many objects.
 Property, life, health, and dignity, for example, are objects
that may suffer damage.
 The damage may be cause by human factors, such as
violent acts or accidents caused by negligence.
In order to protect the legal rights of the victims of such
incidents, there are laws and regulations on liability for
compensation for non-contractual damages.
This type of liability arises when a person intentionally or
unintentionally harms the life, health, honour, dignity,
reputation, property, or other legal rights or interests of an
individual, or harms the honour, reputation, or property of a
legal entity or other subject, thereby causing damage.
45
Base for giving rise to liability for
compensation of non-contractual damages
The liability to compensation for extra-contractual damage shall
arise only when all the following elements appear:
 There must be damage caused. Damage includes material and
spiritual damage.
• Material damage covers damage caused by infringement upon
property or physical body of the victim.
• Spiritual damage to an individuals consists of damage caused
by infringement upon health, honour, dignity, and/or prestige
of the victim, or by infringement upon life for which the next of
kin of the victims have to suffer pain, agony, sentimental loss,
prestige decline or loss, or for distance from friend due to
misunderstanding.
When a victim suffer either type of damage, the perpetrator shall
provide a sum of money as compensation for the loss the victim
has suffered.
47
2.4. Compensation
of non-contractual damages
 Definition of compensation of non-contractual
damages
 Base for giving rise to liability for compensation
of non-contractual damages
44
2.4. Compensation
of non-contractual damages
 Definition of compensation of non-contractual
damages
 Base for giving rise to liability for compensation
of non-contractual damages
46
Base for giving rise to liability for
compensation of non-contractual damages
The liability to compensation for extra-contractual
damage shall arise only when all the following elements
appear:
 There must be illegal acts committed. Illegal acts could
be acts or omissions that violate the law.
 There must be a cause-and-effect link between the
damage caused and the illegal acts. In this case, the
damage caused must be a clear result of the illegal act.
 The damage must be the fault, intentional or
unintentional, of the perpetrators.
48
8
 Base for giving rise to liability for
compensation of non-contractual damages Chapter 2. Civil Law
If any of the above-mentioned conditions are missing, 2.1. General provisions
then the accused perpetrators are not liable to 2.2. Property and ownership rights
compensate for damage.
2.3. Civil obligations
When the damage is caused, from the theory perspective,
2.4. Compensation of non-contractual damages
the one who caused the damage must be the one to
compensate. Liability, however, may be limited for those 2.5. Law of tort
who do not have the full capacity for civil acts.

49 50

Definition Types of Torts

 The law of tort is a branch of the private (civil) law.  There are different types of torts recognised by the
 A tort is a “civil wrong”, which is a wrong committed against English law and each tort sets out a certain expected
an individual. standard of behaviour.
 The law of tort, protects the rights & freedoms of  Types of torts can be divided as follows:
individuals, their property and reputation.
• The Tort of Negligence
 Therefore, the law of torts serves two main purposes:
• The Tort of Defamation
• Compensation: the law of torts ensures that those who
are injured/suffer damages, receive compensation. • The Tort of Trespass (both against the person and
• Deterrence: the threat of compensation (like the threat of property)
punishment in the criminal law) encourages individuals to • The Tort of Nuisance
behave more responsibly.

51 52

The Tort of Negligence

The Tort of Negligence

 Definition of tort of negligence

 Elements of tort of negligence

53 54

9
 Definition of Tort of Negligence
The Tort of Negligence
 Dictionary Definition: “lack of proper care and
attention”.
 Legal Definition: “ the breach of a legal duty of care,  Definition of tort of negligence
which results in damage to the claimant undesired by  Elements of tort of negligence
the defendant”.
 Both definitions provide that negligence involves the
claimant receiving a sub standard level of care.

55 56

Elements of Tort of Negligence Types of Torts

 The following four elements must be established to prove
negligence:  There are different types of torts recognised by the
• The claimant suffered a type of damage recognised by the English law and each tort sets out a certain expected
law of tort;
• The defendant owed the claimant a duty of care; standard of behaviour.
• The defendant breached the duty of care; and  Types of torts can be divided as follows:
• The breach caused the claimant reasonably foreseeable
damage. • The Tort of Negligence
NB: the burden of proof will always be on the claimant! • The Tort of Defamation
• The Tort of Trespass (both against the person and
property)
• The Tort of Nuisance

57 58

Tort of Defamation Types of Torts

Defamation means tarnishing the reputation of someone.
 There are different types of torts recognised by the
It is divided into two parts, slander and libel.
English law and each tort sets out a certain expected
 Slander is spoken defamation; and standard of behaviour.
 Libel is defaming somebody through print (or  Types of torts can be divided as follows:
broadcasting).
• The Tort of Negligence
Both share the same features. To defame someone, you
• The Tort of Defamation
must (a) make a factual assertion (b) for which you cannot
provide evidence of its truth. • The Tort of Trespass (both against the person and
Defamation does not affect the voicing of opinions, but property)
comes into the same fields as rights to free speech in the • The Tort of Nuisance
European Convention (Article 10).
59 60

10
 Tort of Trespass
A trespass is a direct injury to a person, his property or
land, committed directly and intentionally by the
defendant. For example, walking on someone's land is not
trespass but cutting a gate into pieces with a saw is.
However, this rule did not cater for anything injured
indirectly by a person. For example, if a farmer sets fire to
a field, and someone's home is subsequently damaged.
Trespass by the case did, however, provide a legal writ for
injury caused indirectly by an action.
61
Tort of Nuisance
"Nuisance" is traditionally used to describe an activity
which is harmful or annoying to others such as indecent
conduct or a rubbish heap.
The tort of nuisance allows a claimant (formerly plaintiff)
to sue for most acts that interfere with their use and
enjoyment of their land.
63
Types of Torts
 There are different types of torts recognised by the
English law and each tort sets out a certain expected
standard of behaviour.
 Types of torts can be divided as follows:
• The Tort of Negligence
• The Tort of Defamation
• The Tort of Trespass (both against the person and
property)
• The Tort of Nuisance
62
Tort of Nuisance
There are two types of nuisance in English law: Public
nuisance and Private nuisance. In some instances, the same set of
facts can produce liability in both kinds of nuisance, although the
two types of nuisance are very much distinct.
 Private nuisance is concerned with protecting the rights of an
occupier in respect of unreasonable interference with the
enjoyment or use of his land. The parties to an action in private
nuisance are generally neighbors in the popular sense of the
word and the courts undertake a balancing exercise between the
competing rights of land owner to use his land as he chooses and
the right of the neighbor not to have his use or enjoyment of land
interfered with.
 Public nuisance is a crime but becomes actionable in tort law if
the claimant suffers 'particular damage' over and above the
damage suffered by the public generally.
64
11
 Content
Chapter 1. Introduction to Law
Chapter 2. Civil Law
Chapter 3. Contract Law
Chapter 4. Law on Business Organizations
Chapter 5. Commercial Law
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law
Chapter 8. Intellectual Property Law
Chapter 9. International Law
1 2
Chapter 3. Contract Law
1. Conditions for effective contracts
2. Legal effect of invalid contracts
3 4
1. Conditions for effective contract
According to Article 117 of Civil Code 2015, the conditions for
validity are as follow:
 The objectives and contents of civil contracts are not contrary to
the law and social morals.
• Legal prohibitions mean provisions of law which do not permit
entities to perform certain acts (Article 123).
• Socials morals are standards of general behaviors between
person in social life, which are recognized and respected by
the community (Article 123).
• The objectives of a civil contract are the lawful interests which
the parties wish to achieve when they enter into establish a
civil contract (Article 123).
• The contents of a contract consist of several components;
among which are basic terms and conditions, compulsory
terms and conditions, and optional terms and conditions.
Depending on the complexity as well as the specific features of
an individual contract, different terms and conditions will be
employed.
5 6
Chapter 3. Contract Law
According to Article 385 of Civil Code 2015, civil contract
means an agreement between parties in relation to the
establishment, modification or termination of civil rights
and obligations.
When subjects enter into civil contract, there are
fundamental principles must be obeyed, such as
freedom of contract (provided that this is consistent of
with law and social morals), voluntariness, equality,
goodwill, co-operation, honesty, and good faith.
1. Conditions for effective contract
To ensure the validity of the contract, there are crucial
conditions that a contract must meet. Only the valid
contract has a legally binding effect on the parties.
According to Article 117 of Civil Code 2015, the
conditions for validity are as follow:
 The subjects who take part into civil contracts must
have civil act capacity for civil acts. The levels of civil
capacity of each kind of transactions are not the same,
as they vary depending on the value as well as the
purpose of the contract and subject matter.
1. Conditions for effective contract
According to Article 117 of Civil Code 2015, the conditions for
validity are as follow:
 Person participating in the civil contract must enter into the
contract entirely voluntarily. Accordingly, the establishment and
performance of the civil contract must be base on the voluntarily
actions of the parties. When the contracts are entered into
involuntarily by either party, the contract shall be invalid.
• Where parties enter into a civil contract falsely for the purpose
of concealing another contract, such a false contract shall be
invalid; notwithstanding, the contract that is concealed shall be
valid, unless it is also invalid pursuant to provisions of Civil
Code. Where the parties enter into a civil contract falsely for
the purpose of evading responsibilities to a third person, such a
contract shall be invalid.
• Another situation that would render the contract invalid is
when any party enters into a contract due to deception or
threat. As they have entered into the contract involuntarily,
they have right to request the court to declare the contract
invalid.
1
 1. Conditions for effective contract
According to Article 117 of Civil Code 2015, the conditions
for validity are as follow:
 The term of contract is in accordance with law. The
forms of civil contracts are the means through which
the will of subject are shown. Civil contract can be
created verbally, in writing, or through specific acts.
With respect to certain kinds of property; contracts
must be made in writing and notarized or certified by
the competent State body. In such a situation, the form
of the contract must meet the law’s specific
requirements to be valid.
7 8
Chapter 3. Contract Law
1. Conditions for effective contracts
2. Legal effect of invalid contracts
9 10
2. Legal effect of invalid contracts
When a civil contract is found to be invalid, it is necessary to protect
the interests of bona fide third parties. Where a civil contract is
invalid, but the transacted property is moveable property, the
ownership of which is not required to be registered, and such
property has already been transferred to a bona fide third person by
way of another transaction, the transaction with a third person shall
remain valid (Article 133 of Civil Code 2015).
On the contrary, if the transacted property is immovable property,
or is moveable property, the ownership of which is required to be
registered, and where the transacted property has been transferred
to a bona fide third person by way of another transaction, the
transaction with a third person shall be invalid. The transaction is
considered as valid only where the bona fide third person received
the property by way of auction or a transaction with another party
being the owner of such property pursuant to a judgment or
decision of an authorized State body but thereafter such person is
not the owner of the property as a result of the judgment or
decision being amended or rescinded (Article 167 of Civil Code
2015).
11
1. Conditions for effective contract
According to Article 398 of Civil Code 2015, a contract may
have the following contents:
• Subject matter of the contract;
• Quantity and quality;
• Price and method of payment;
• Time-limit, place and method of performing the
contract;
• Rights and obligations of the parties;
• Liability for breach of contract;
• Methods of settlement of disputes.
2. Legal effect of invalid contracts
An invalid civil contract shall not give rise to civil rights and
obligations of the parties or to changes and termination of
such rights and obligations. Where a civil transaction is
invalid, the parties shall restore everything to its original
state and shall return to each other what they have
received. If the restitution is not available for being made
in kind, it may be paid in money, except where the
transacted property, benefits, and income which had been
received are confiscated in accordance with law. The party
at fault, which caused damage, must compensate (Article
131 of Civil Code 2015).
2. Legal effect of invalid contracts
Contract are useful legal tool for parties when they enter into
civil transactions. Based on contracts’ content , new rights and
obligations of parties are defined. When conflicts occur
between parties during the performance of the promised
action, contracts are employed to identify and solve the
problems. When parties do not perform, or not perform their
obligations sufficiently as agreed, they have to compensate for
damage caused by their contract violation. The limitation
period for initiating legal action to request a court to resolve a
dispute relating to a contract is three years from the date on
which the party entitled to request knows or should know that
their lawful rights and interests are infringed (Article 429). This
Article is necessary because if the time limit is so long, it is very
difficult to consider thoroughly and objectively of the
evidences for the case.
12
2
 Content
Chapter 1. Introduction to Law
Chapter 2. Civil Law
Chapter 3. Contract Law
Chapter 4. Law on Business Organizations
Chapter 5. Commercial Law
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law
Chapter 8. Intellectual Property Law
Chapter 9. International Law
1 2
1. Overview of Law on Business
• Right to establish, contribute capital,
purchase shares and contributed capital
amounts and manage enterprises
• Name of the enterprise
• Property contributed as capital
• Sectors of business investment
3 4
1. Overview of Law on Business
• Name of the enterprise
(Article 37, 38 and 39 Law on Enterprises 2020)
5 6
Chapter 4. Law on
Business Organizations
1. Overview of Law on Business
2. Forms of Business Organization
3. Establishment and Dissolution of
Business Organization
1. Overview of Law on Business
• The organizations and individuals may not establish and
manage enterprises in Vietnam.
• Organizations and individuals have the right to
contribute capital to, purchase shares or contributed
capital amounts of, joint stock companies, limited
liability companies and partnerships.
(Article 17 Law on Enterprises 2020)
1. Overview of Law on Business
1. Assets contributed as capital shall be in the form of
Vietnam dong, freely convertible foreign currencies, gold,
land use rights, intellectual property rights, technologies,
technical know-how and other assets that can be valued in
Vietnam dong.
2. Only individuals and organizations that are lawful
owners or have lawful use right of above-mentioned assets
prescribed in Clause 1 of this Article may use such assets
for capital contribution according to the regulations.
(Article 34 Law on Enterprises 2020)
1
 1. Overview of Law on Business
• Freedom of enterprise in the sectors and trades that
are not banned by law (Article 7 Law on Enterprises
2020)
• Sectors and trades subject to conditional business
investment (Article7 Law on Investment)
• Sectors and trades banned from business investment
(Article 6 Law on Investment)
7 8
2. Forms of Business Organizations
 Household business
 Private enterprise
 Limited liability company
 Shareholding company
 Partnership
9 10
Household business
Different form the other enterprise types, a household
business is designed by lawmakers as a small size
business because a household business can register
business at different locations but must select a fixed
location for registration of the business household
headquarter.
This type of business entity does not have a stamp as a
company or private enterprise does.
11
Chapter 4. Law on
Business Organizations
1. Overview of Law on Business
2. Forms of Business Organization
3. Establishment and Dissolution of
Business Organization
Household business
A type of small size business entity in Vietnam is the so-
called “hộ kinh doanh” or a proprietorship or house hold
business. This type of business is principally governed by
Decree no 01/2021/NĐ-CP of the Government.
In contemporary Vietnamese law, a household business
is owned by either a Vietnamese individual, a family
(household); a foreigner or a foreign family appears not
to have a right to register a household business in
Vietnam.
Household business
Similar to private enterprise, a household business is not
separate legal entity. The owners of this business entity
are exposed to an unlimited liability for the debts of the
business; they are liable for all debts accumulated due to
business activities.
12
2
 Chapter 4. Law on
Business Organizations
 Household business
 Private enterprise
 Limited liability company
 Shareholding company
 Partnership
13
Private enterprise
The business entity is an enterprise owned by an
individual who must be at least 18 years old. A legal
entity cannot set up a private enterprise but can register
a one-member LLC. Furthermore, a Vietnamese
individual can register one private enterprise in the
country only. However, a private enterprise may
establish many branches in Vietnam. The owner of
private enterprise has full powers to manage and direct
the enterprise as she/he sees fit. The private enterprise
owner can be also the CEO of enterprise.
15
Private enterprise
A private enterprise is not recognize as a legal person (a separate
legal person). Vietnamese law states that the private enterprise is a
type of entity but it is not a legal person. The reason for this can be
seen in the Civil Code 2015, in which a separate legal entity must
satisfy full four conditions. Accordingly, under Vietnamese law, a
private entity has no assets apart from its owner, and then owner
owns all assets of the enterprise. Under the Vietnamese law, the
enterprise owner must act as a plaintiff or defendant before an
arbitration or court in all cases relating to the enterprise; therefore,
different from a company, a private enterprise cannot sue or be
sued under its own name. If a person wants to sue the private
enterprise, he/she must sue the owner of the enterprise. This is
different from companies and partnerships because a company or a
partnership can sue or be sued under its own name.
17
Private enterprise
The private enterprise was first officially introduced by
the Law on Private Enterprise in 1990. Private enterprise
become very popular for Vietnamese investors,
especially in rural areas. In practice, the size of private
enterprise is often small or medium.
14
Private enterprise
The owner of this type is liable for all debts of the enterprise with
his/her own property. That means the liability of the owner as to
debts of the enterprise is unlimited. When a private enterprise is
bankrupt, the owner of private enterprise shall be liable for all
debts of the enterprise that have not paid fully by the enterprise.
As such, this type of the business is quite risky for the owner and
different from the liability of shareholders of a shareholding
company or a limited liability company. The Article 184 of Law on
Enterprise requires the owner of private enterprise to register the
exact amount of the investment capital of the enterprise. The
liability of the owner to the debt of this business entity is the same
as the owner of household business.
16
Private enterprise
Furthermore, the private enterprise has no right to issue
any kind of shares or bonds to the public. If the
enterprise’s owner wishes to raise its investment capital,
he/she can borrow from a bank. A private enterprise must
be registered at the Business Registration Office of the
province where the enterprise’s headquarter is located.
Although an individual has the right to set up only one
private enterprise, the enterprise can expand its business
throughout the whole country through establishment of
branches and representation offices.
18
3
 Private enterprise
At the first decade of implementation of the Law on
Private Enterprise in 1990, many private enterprises were
established in Vietnam. However, in recent years the
percentage of this enterprise type has fallen to a lower
figure. With the unlimited liability of the owner for the
debts of the enterprise, owners of the private enterprise
may be concerned with the risks they face in a
competitive business environment. In recent years,
Vietnamese law allows the owner of this business type to
convert a private enterprise to a limited liability company
if it meets certain conditions required by law.
19
The management structure of
a private enterprise
The Law on Enterprise does not provide in detail the management
structure of a private enterprise, as it does for other company types
under the law. The Law on Enterprise states that the owner is
entitled to decide on any business operation of the private
enterprise and distributions of profits after paying taxes and other
financial obligations as stipulated by the laws.
The owner himself/herself manages and runs business operations
of the enterprise, or may employ a person to do so. Employment of
a director (CEO) of the enterprise must be reported to business
registrar, and the owner remains fully liable for all business
operations of the enterprise.
20

The management structure of

a private enterprise Chapter 4. Law on
Business Organizations
Under the Vietnamese law, the legal representative of
private enterprise is the owner who has the power and  Household business
authority to act on behalf of this business entity.  Private enterprise
Therefore, if the owner hires another person to be the
director of the enterprise, he/she should authorize the  Limited liability company
director to act on behalf of the enterprise. Different from  Shareholding company
shareholders of companies, the owner of the enterprise
 Partnership
has full powers to decide the organizational structure and
power division of the enterprise.

21 22

Limited liability company

The limited liability companies are the most popular Limited liability company
company type in Vietnam. In general, an LLC under the
Different from company laws of some other jurisdictions,
Law on Enterprise is probably similar to a private
Vietnamese law classify LLCs into two types:
company in the U. K.
The limited liability company means a company in which  LLCs with 2 or more members; and
the number of members does not exceed 50, the  LLCs with only one member.
members’ liability is limited to the amount they
compromised to contribute to the charter capital of the
company. The LLC itself is a legal person but has no right
to issue shares to the public in order to raise its share
capital.
23 24

4
 LLCs with two or more members
According to Article 46 of Law on Enterprise, a multiple
member LLC is the business organization that:
 is a separate legal entity;
 has 02-50 members (an organization or a natural
person) whose liability is limited to the amount they
undertake to contribute to the company’s charter
capital, and
 has no right to issue share to the public.
A company must have a register of members immediately
after business registration and this book must contain all
information about members of the company as the law
requires (Article 48 of Law on Enterprise 2020).
25
LLCs with two or more members
Under the Law on Enterprise in Vietnam, a member shall
be liable for the debts and other property obligations of
the LLC within the amount of capital he/she has
undertaken to contribute to the company charter capital.
27
LLCs with two or more members
As in many other countries, a shareholder of an LLC with
two or more members shall enjoy a range of rights, such
as voting at the Members’ Council with the number of
votes in proportion to its share of capital contribution,
along with the right to monitor records, books of account,
annual financial statements, and minutes of meetings of
the Members’ Council; and the right to be given priority
in making additional capital contributions to the company
upon any increase of charter capital of the company.
29
LLCs with two or more members
An LLC with 2 or more members is recognized as a
separate legal entity from the date it is issued the
certificate of enterprise registration. Hence, different
from a private enterprise, an LLC enjoys full advantages of
a legal person as the law states. The property of the
company is separated from its shareholders and owned
by the company.
26
LLCs with two or more members
Every member must contribute capital properly in terms of
sufficiency and type of assets as agreed within 90 days from the day
on which the Certificate of Business registration is issued.
Company’s members may only contribute assets other than the
promised assets it such assets are approved by the majority of
other members. After the said deadline, each member has the
rights and obligations proportional to their promised capital
contribution.
If a member fails to contribute capital or fails to fully contribute
capital as agreed, the company shall register a change to charter
capital and the member’s stake holding within 60 days from the
deadline for making sufficient capital contribution prescribed in
Clause 2 of this Article. Any member who fails to contribute capital
or fails to fully contribute capital as agreed shall take responsibility
up to the value of promised capital contribution for the company’s
financial obligations incurred before the day on which the company
registers the changes to the charter capital and its members’ stakes.
(Article 47 of Law on Enterprise 2020)
28
LLCs with two or more members
As in many other jurisdictions, LLCs cannot issue shares,
as issuing shares is a typical characteristic of a
shareholding company. However, LLCs can raise the
capital by using others means of getting capital, such as
borrowing from banks and other organization.
30
5
The organization and management structure
of LLC with two or more members
A multi-member limited liability company has a Members’
Council, a the Chairperson of the Board of Members’
Council, a Director/General Director.
Every multi-member limited liability company that has 11
members or more shall establish a Board of Supervisors.
That means there are less than 11 members, the
Supervisor Board may or may not be established.
Rights, obligations, standards, requirements, and
conditions of Members’ Council and Chief of Members’
Council shall be provided for in the company’s charter.
(Article 54 of Law on Enterprise 2020)
31
The Members’ Council
According to Article 55 of Law on Enterprise, the Members’ Council
has the following rights and obligations:
• Decide the annual business plan and development strategy of
the company;
• Decide the increase or decrease of charter capital; decide the
time method for raising additional capital;
• Decide development investment projects of the company;
• Decide solutions for market development; marketing, technology
transfers; ratifying contracts for taking loans, granting loans,
selling assets of which the value is higher than 50% of total asset
value written in the latest financial statement (or a smaller rate
or value prescribed by the company’s charter);
• Elect, dismiss the Chairperson of the Board of members; decide
the designation of, dismissal of, conclusion and termination of
contracts with the Director/General Director, Chief accountant,
and other managers prescribed by the company’s charter;
33
Chairperson of the Members’ Council
The Members’ Council shall elect a member as the
Chairperson. The Chairperson of the Board of members
may concurrently hold the position of the company’s
Director/General Director.
35
The Members’ Council
The Members’ Council consists of all company’s members
and is the supreme decision-making body of the
company. The frequency of meetings of the Board of
members shall be specified by the company’s charter.
Nevertheless, there must be at least one meeting per
year.
(Article 55 of Law on Enterprise 2020)
32
The Members’ Council
According to Article 55 of Law on Enterprise, the Members’ Council
has the following rights and obligations
• Decide the salaries, bonuses, and other benefits for the
Chairperson of the Members’ Council, Director/General Director,
Chief accountant, and other managers prescribed by the
company’s charter;
• Ratify annual financial statements, plans for use and distribution
of profit, or plans for loss settlement of the company;
• Decide the company’s organizational structure
• Decide establishment of subsidiaries, branches, and
representative offices;
• Amend the company’s charter;
• Decide the company restructuring;
• Decide the dissolution or petition for bankruptcy of the
company;
• Other rights and obligations prescribed by this Law and the
company’s charter.
34
Chairperson of the Members’ Council
According to Article 56 of Law on Enterprise, the Chairperson of the
Members’ Council has the following rights and obligations:
• Prepare the agenda and operation plan of the Board of
members;
• Prepare the agenda, contents, documents of meetings of the
Board of members or for absentee voting;
• Convene and chair meetings of the Board of members or
organize the absentee voting;
• Carry out or organize supervision of implementation of
Resolutions of the Board of members;
• Sign Resolutions of the Board of members on behalf of the Board
of members;
• Other rights and obligations prescribed by this Law and the
company’s charter.
36
6
 Chairperson of the Members’ Council
The term of office of a the Chairperson of the Members’ Council
shall not exceed 05 years. The Chairperson of the Members’ Council
may be re-elected without term limit.
If the Chairperson of the Members’ Council is absent or incapable
of performing his/her rights and obligations, he/she may authorize
another member in writing to perform rights and obligations of the
Chairperson of the Members’ Council in accordance with the
company’s charter. If no member is authorized, one of the
members of the Members’ Council shall convene a meeting to elect
one of the members to temporarily perform rights and obligations
of the Chairperson of Members’ Council under the majority rule.
37
The Director/General Director (CEO)
of the Company
According to Article 63 of Law on Enterprise, the Director/General
Director has the following rights and obligations:
• Organize the implementation of Resolutions of the Members’
Council;
• Decide the issues related to the company’s everyday business
operation;
• Organize the implementation of the company’s business plans
and investment plans;
• Promulgate the company’s rules and regulations, unless
otherwise prescribed by the company’s charter;
• Designate, dismiss the company’s managerial positions, except
for those within the competence of the Board of members;
• Sign contracts on behalf of the company, except for those within
the competence of the Members’ Council;
39
Limited liability company
Different from company laws of some other jurisdictions,
Vietnamese law classify LLCs into two types:
 LLCs with 2 or more members; and
 LLCs with only one member.
41
The Director/General Director (CEO)
of the Company
The Director or General Director of a company is the
person who administer the everyday business operation
of the company and is responsible to the Board of
members for the performance of his/her rights and
obligations.
38
The Director/General Director (CEO)
of the Company
According to Article 63 of Law on Enterprise, the Director/General
Director has the following rights and obligations:
• Propose organizational structure plan;
• Submit annual financial statements to the Board of members;
• Propose plans for use of profits or loss settlement;
• Hire employees;
• Perform other rights and obligations prescribed in the company’s
charter, employment contract between Director/General
Director and the company according to the Resolution of the
Members’ Council.
40
LLCs with only one member
A single-member limited liability company is a enterprise
under the ownership of an organization or individual; the
company’s owner is liable for the company’s debts and
other liabilities up to the company’s charter capital.
A single-member limited liability company has its legal
status from the issuance date of the Certificate of
Business registration.
Single-member limited liability companies must not issue
shares.
(Article 74 of Law on Enterprise)
42
7

LLCs with only one member
The Law on Enterprise classify the owner of the company
into 2 groups: organization owners and individual owners.
There are some differences between the rights and
obligations of the owner of one member LLC and those of
members of an LLC with 2 or more members.
43
LLCs with only one member
According to Clause 1 of Article 76 of Law on Enterprise, the company’s
owner being an organization has the rights to:
• Decide the sale of assets of which the values are equal to or higher
than 50% of the total asset value written in the latest financial
statement of the company, or a smaller rate prescribed by the
company’s charter;
• Decide increases to the company’s charter capital; transfer part of or all
of the company’s charter capital to other organizations and/or
individuals;
• Decide the establishment of subsidiaries, capital contributions to other
companies;
• Supervise and assess the company’s business operation;
• Decide the use of profit after company’s tax liability and other financial
obligations are fulfilled;
• Decide the company’s restructuring, dissolution, and petition for
bankruptcy;
• Withdraw the entire value of the company’s asset value after the
dissolution or bankruptcy process is completed;
• Exercise other rights prescribed in this Law and the company’s charter.
45
LLCs with only one member
Because the Law treats one member LLC as legal person, the
company owner must also indentify and separate assets of the
owner from assets of the company. Further, an individual
company owner must separate his or her personal
expenditures and family expenditures from the company
expenditures.
The Law does not prohibit the company owner from entering
into transactions with the company. In such situation, the Law
requires the owner to comply with the contract laws and
relevant legislation with respect to any purchase, sale,
borrowing, lending, lease, or rent and other transactions
between the company and the company owner (Article 77 of
Law on Enterprise).
47
LLCs with only one member
According to Clause 1 of Article 76 of Law on Enterprise, the
company’s owner being an organization has the rights to:
• Decide the contents of the company’s charter; amend the
company’s charter;
• Decide the annual business plans and development plans of the
company;
• Decide the organizational structure; designate and dismiss the
company’s manager;
• Decide development investment projects;
• Decide solutions for market development, marketing, and
technology;
• Ratify contracts to take loans, contracts to grant loans, and other
contracts prescribed by the company’s charter of which the
values are equal to or higher than 50% of the total asset value
written in the latest financial statement of the company, or a
smaller rate prescribed by the company’s charter;
44
LLCs with only one member
According to Clause 2 of Article 76 of Law on Enterprise, the
company’s owner being an individual has the rights to:
• Decide the contents of the company’s charter; amend the
company’s charter;
• Decide the company’s investments, business operation, and
administration, unless otherwise prescribed by the company’s
charter;
• Decide increases to the company’s charter capital; transfer part
of or all of the company’s charter capital to other organizations
and/or individuals;
• Decide the use of profit after company’s tax liability and other
financial obligations are fulfilled;
• Decide the company’s restructuring, dissolution, and petition for
bankruptcy;
• Withdraw the entire value of the company’s asset value after the
dissolution or bankruptcy process is completed;
• Exercise other rights prescribed in this Law and the company’s
charter.
46
The organization and management
structure of one member LLC
According to Article 79 of the Law of Enterprise, a single-
member limited liability company under the ownership of
an organization shall apply one of the following
organizational models:
• The company's President, Director/General Director,
and Controller;
• The Board of members, Director/General Director, and
Controller.
48
8
 The organization and management
structure of one member LLC
 Members of Members’ Council shall be designated and dismissed
by the company’s owner; there will be 03 – 07 members, the
term of office shall not exceed 05 years. The Members’ Council,
on behalf of the company, shall perform rights and obligations of
the company’s owner and the company (Article 79.1 of Law on
Enterprise).
 The company's President is designated by the owner. The
company's President, on behalf of the company’s owner, shall
perform rights and obligations of the company’s owner and the
company, except for rights and obligations of the
Director/General Director; take legal responsibility to the
company’s owner for the fulfillment of rights and obligations in
accordance with this Law, relevant regulations of law, and the
company’s charter (Article 81.1 of Law on Enterprise).
49
Chapter 4. Law on
Business Organizations
 Household business
 Private enterprise
 Limited liability company
 Shareholding company
 Partnership
51
Shareholding company
According to the Law on Enterprise, shareholding company has
its legal status from the issuance date of the Certificate of
Business registration. Shareholding companies are entitled to
issue various types of shares to raise capital.
The shareholding company is a popular company type in
Vietnam and similar to a public company in the U. K.
53
The organization and management
structure of one member LLC
 The Members’ Council or the company's President shall
designate or hire Director/General Director, the term of office of
whom does not exceed 05 years, to administer the company’s
everyday business operation. The Director/General Director is
legally responsible to the Board of members or the company's
President for fulfillment of his/her rights and obligations. The
Chairperson of the Board of members, other members of the
Board of members, or the company's President may concurrently
hold the position of Director (General Director), unless otherwise
prescribed by law or the company’s charter (Article 82.1 of Law
on Enterprise).
50
Shareholding company
According to Article 111 of Law on Enterprise, a shareholding
company is an enterprise of which:
• Charter capital is split into multiple units of equal value
called shares;
• Shareholders may be organizations and individuals; the
minimum quantity of shareholders is 03; the maximum
quantity is not restricted.
• Shareholders are only liable for the enterprise’s debts and
other liabilities up to the value of capital contributed to the
enterprise;
• Shareholders are entitled to transfer their shares to other
persons, except for the cases in Clause 3 Article 120 and
Clause 1 Article 127 of this Law.
52
Shareholding company
The shareholder of the shareholding company is either a
legal person or an individual who holds one or more
shares of the company. A shareholder may be either
Vietnamese or foreign individual or organization. All
shareholders are liable for debts and liabilities of the
company within the amount of capital that they
contributed.
54
9
 Shareholding company
Under the Law on Enterprise, the shareholding company is an
enterprise of which the charter capital is divided into equal
portions know as shares. A shareholding company must issue
ordinary shares and preference shares. A shareholding
company must issue ordinary shares, and may issue preference
share. Preference shares include voting preference shares,
dividend preference shares, redeemable preferences, and
other type of preference share as stipulated in the company
charter. Persons who are entitle to hold preference shares are
stipulated in the company charter or as decided by the
Shareholders’ Meeting.
55
The organization and management
structure of a shareholding company
The internal corporate governance structure of shareholding
company is comprises of Shareholders’ Meeting (SM), the
Board of Management (BOM), and the director/general
director (the CEO). Moreover, the company must have a Board
of Supervisors (BOS) if it has more than eleven individual
shareholders or has institutional shareholders holding more
than 50% of the share capital.
57
The Shareholders’ Meeting
According to Article 138 of the Law on Enterprise, the Shareholders’
Meeting has the following rights and obligations:
• Ratify the company’s development orientation;
• Decide the types of shares and amount of each type of
authorized shares; decide annual dividend payment of each type
of shares;
• Elect, dismiss, discharge from duty members of BOM and BOS;
• Decide investment or sale of assets of which the values are equal
to or higher than 35% of the total asset value written in the latest
financial statement of the company, unless a smaller rate is
prescribed by the company’s charter;
• Decide amendments to the company’s charter;
• Ratify annual financial statements;
59
Shareholding company
In practice, Vietnamese shareholding companies rarely issue
preference shares and among preference shares, voting
preference share seem to be rather common. While preference
shares may be converted into ordinary shares pursuant to
decisions of the Shareholders’ Meeting, ordinary shares shall
not be converted into preference shares. In principle,
shareholders of the same type will be given the same rights,
interests, and obligations.
56
The Shareholders’ Meeting
The SM, which consists of all shareholders having voting
rights, is the highest decision-making body of the
shareholding company. The meeting of shareholders is
required to be held at least once per year and within four
months from the ending date of fiscal year (Article 138
and 140 of Law on Enterprise).
58
The Shareholders’ Meeting
According to Article 138 of the Law on Enterprise, the Shareholders’
Meeting has the following rights and obligations:
• Decide repurchase of more than 10% of total sold shares of each
type;
• Consider taking actions against violations committed by the
Board of Directors and the Control Board that cause damage to
the company and its shareholders;
• Decide the company’s restructuring and dissolution;
• Perform other rights and obligations prescribed by this Law and
the company’s charter.
60
10
 The Board of Management (BOM)
The Board of Management (BOM) play a very important
role in governing a shareholding company. Under the Law
of Enterprise, the BOM consists of three to eleven
members. The BOM is a management body of the
company and entitled to act on behalf of the company in
exercising all the rights and obligations of the company,
except those for that falls under the authority of the SM.
The office-term of the BOM is five years, but a member of
the Board can be re-elected to an unlimited number of
terms (Article 153 and 154 of Law on Enterprise).
61
The Board of Management (BOM)
According to Article 156 of the Law on Enterprise, the
Chairperson of BOM is elected by the BOM, as stipulated in the
company charter. The Chairperson may hold at the same time
the position of the CEO, unless otherwise stipulated in the
company charter.
He/she will have rights and obligations as stipulated in the
Article 156, such as preparing the programs and working plans
of the Board and the agenda, contents, and materials for the
BOM’s meetings; convening and chairing the meetings of the
SM and the BOM; and supervising the implementation of
decisions adopted by the Board. However, as stated, this
position appears not to be powerful as the CEO position.
63
The Chief Executive Officer (CEO)
The CEO has powers to make decision on all matters
arising from the day-to-day operation of the company
without seeking consent from the BOM. The CEO also has
the power to appoint, dismiss, or remove managers of the
company (except those whom the BOM reserves the right
to appoint, dismiss, or remove); to hire employees; and to
arrange for the implementation of BOM’s decisions and of
business and investment plans of the company.
(Article 162 of Law on Enterprise)
65
The Board of Management (BOM)
According to Article 153 of the Law on Enterprise, the BOM has
powers to decide important issues of the company, such as:
the establishment of branches, representative offices, and
subsidiary companies; the contribution of capital to or buying
of shares issued by other companies; the amount of dividend
and the time and procedures for payment of such dividend;
the method for settlement of losses; development strategy
and the annual business plan of the company; setting the
offering price of shares and bonds; instituting share buy-backs;
and appointing and dismissing the CEO and other key
managers of the company. The BOM also has powers to
approve the organizational structure and internal working
rules, and the agenda and materials of the SM.
62
The Chief Executive Officer (CEO)
The CEO (Giám đốc/Tổng Giám đốc) manages the day-to-
day operation of the company under the supervision of
the BOM, and must be liable to the BOM for his/her
performance of assigned rights and obligations. The CEO is
selected by the BOM with an term no more than 5 years.
The BOM can hire another person as CEO.
64
The Board of Supervisors (BOS)
There is a supervision board in the internal corporate
governance structure of Vietnamese shareholding
company. The BOS is independent from the BOM and is
responsible toward the SM, and has powers to supervise
the BOM and the CEO in managing and running the
company.
The BOM has an office term of up to five years and
consists of three to five members. The Chief of BOS must
be a professional accountant or auditor.
(Article 168 of Law on Enterprise)
66
11
 The Board of Supervisors (BOS)
The powers of the BOS are provided for in the Article 165 of
Law on Enterprise. For example, the BOS has powers to review
the reasonableness, lawfulness, trustworthiness, and diligence
of the business management; to review accounting books and
financial statements; to check and review other documents of
the company or matters particularly related to the
management and running of the company; and to warn the
BOM of any violation of duties managers as stipulated and to
request the manager who committed such a violation to stop
and indemnify losses. However, any investigation of the BOS
must be carried out in a manner that does not obstruct the
usual operation of the BOM, and must not interrupt the
ordinary business operation of the company.
67
Partnership
According to Article 177 of Law on Enterprise, a partnership is
a legal person which there are no less than two general
partners who are joint owners of the company and carry out
business under one common name. In addition to general
partners, there may also be one or more limited partners. A
partnership is not permitted to issue any type of securities.
The general partner must be an individual and liable to all
obligations and debts of the partnership with her/his entire
property. However, limited partners are liable for the debts of
the partnership only to the extend of their capital contributed
to the partnership. This is the same as the limited liability of
shareholders of shareholding companies and LLCs.
69
Partnership
Nonetheless, a general partner has the power to carry out
registered business activities on behalf of the partnership; to
engage in contracts or transactions that may maximize the benefits
of the partnership; to use the partnership’s property in order to
carry out registered business activities; to be reimbursed by the
partnership for advanced expenses, including interest for personal
amounts that he spent in carrying out the business activities of the
partnership. General partners have to manage and carry out
business activities in a fiduciary, diligent, and optimal manner in
order to maximize the benefits of the partnership and all partners,
and they have to make compensation for any loss caused to the
partnership due to violation of their duties. Furthermore, general
partners must be jointly liable with her/his entire property to the
debts and other obligations of the partnerships if the partnership’s
property is not sufficient to pay off those debts.
71
Chapter 4. Law on
Business Organizations
 Household business
 Private enterprise
 Limited liability company
 Shareholding company
 Partnership
68
Partnership
The Article 180 of the Law on Enterprise imposes some
restrictions on a general partner, such as:
• A general partner must not own a sole proprietorship or
hold the position of general partner of another
partnership, unless otherwise agreed by other general
partners.
• General partners must not do the same business lines of
the company, whether single-handedly or on behalf of
another person, for self-seeking purposes or serving the
interest of other entities;
• A general partner must not transfer part of or all of his/her
stake to another person, unless otherwise agreed by other
general partners.
70
Partnership
Limited partners are entitled to attend, discuss, and vote
in the meeting of the partners’ council in relation to
matters such as amendment or supplement of the
company charter, amendment or supplement of rights
and obligations of limited partners, re-organization and
liquidation of the partnership, and other matters related
to their rights and obligations. Limited partners have no
power to manage the partnership or carrying out
business activities on behalf of the partnership.
Nevertheless, they can transfer their capital contribution
to others.
72
12
 Partnership
The governance structure of the partnership includes a
Members’ Council, Chairperson of the Council, and the CEO.
The partners’ council will elect one among them to be the
chairperson; he/she is also the CEO of the partnership (unless
otherwise stipulated in the charter). The partners’ council is
entitled to decide on the business operations of the
partnership. Particularly, all general partners are entitled to
act as legal representatives of the partnership in carrying out
business activities. It should be noted that any restrictions
applicable to general partners in relation to conducting the
day-to-day business operation of the partnership will be
effective on a third party only if such a party is informed.
73
3. Establishment and Dissolution of
Business Organizations
 Establishment of Business Organization
 Dissolution of Business Organization
75
2. Establishment and Dissolution of
Business Organizations
 Establishment of Business Organization
 Dissolution of Business Organization
77
Chapter 4. Law on
Business Organizations
1. Overview of Law on Business
2. Forms of Business Organization
3. Establishment and Dissolution of
Business Organization
74
Establishment of Business Organizations
The enterprise founders shall fill in the business registration
form and are responsible for the legality, completeness, and
preciseness of registered information. The business
registration offices, which are organized in provinces and cities
directly under the central government, are responsible for the
validity of the business registration dossiers, but are not
responsible for any legal violation of enterprise founders
before and after registration procedures. In the enterprise
registration certificate, each enterprise is assigned a unique
enterprise code, which serves as a business registration code
and tax code.
76
Dissolution of Business Organizations
According to the Article 207 of Law on Enterprise, an enterprise
shall be dissolved in the following cases:
• The operation period written in the company’s charter expires
without a decision on extension;
• The dissolution is decided by the owner of the sole
proprietorship, by all general partners of the partnership, by the
Board of members or owner of the limited liability company, or
insurance the General Meeting of Shareholders of the joint-stock
company;
• The company fails to maintain the minimum number of
members prescribed by this Law for 06
consecutive months without following procedures for business
conversion;
• The Certificate of Business registration is revoked.
78
13
 Dissolution of Business Organizations
The enterprise shall only be dissolved if all debts and
liabilities can be settled and the enterprise is involved in
any dispute at a court or arbitral tribunal. Relevant
managers and enterprises mentioned in Point d Clause 1
of Article 207 are jointly responsible for the enterprise’s
debts (Article 207.2 of Law on Enterprise).
The decision on dissolution of the enterprise must be sent
to the business registration office, creditors,
organizations, employees, or individuals with related
rights, interests, and obligations, and also must be
displayed at the head office of the enterprise.
79

14
 Content
Chapter 1. Introduction to Law
Chapter 2. Civil Law
Chapter 3. Contract Law
Chapter 4. Law on Business Organizations
Chapter 5. Commercial Law
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law
Chapter 8. Intellectual Property Law
Chapter 9. International Law
1 2
1. Overview of traders and
commercial activities
1.1. Traders, commercial activities’ players
1.2. General concept of commercial activities
3 4
1.1. Traders, commercial activities’ players
Based on the above definition, traders have the following
main characteristics:
 Traders can be either individuals or organizations.
Under current law, in addition to the requirement of
having full civil act capacity, an individual must also
satisfy other requirements in order to carry out trading
activities, such as not being one of the person listed in
Article 18.2 of the Law on Enterprise. Only economic
organizations are qualified to carry out trading
activities.
5 6
Chapter 5. Commercial Law
1. Overview of traders and commercial activities
2. Types of commercial activities
3. Breach of commercial contracts and remedies
1.1. Traders, commercial activities’ players
According to Article 6 of the Commercial Law 2005,
traders include lawfully established economic
organizations and individuals that conduct commercial
activities in an independent and regular manner and that
have been registered as business entities. Of note, Article
7 of the Commercial Law further provides that those who
have not yet registered to carry out business as a trader
but in fact conduct commercial activities must do so
accordance with the provisions of the Commercial Law
2005 and are obliged to register their business in
accordance with regulations on business registration.
1.1. Traders, commercial activities’ players
Based on the above definition, traders have the following
main characteristics:
 Traders are those who carry out commercial activities
in an independent and regular manner. This require
two elements:
• Traders must carry out commercial activities
independently in a separate business entity; and
• Commercial activities must be the main businesses
that generate the main source of income for such
traders.
1
 1.1. Traders, commercial activities’ players
Based on the above definition, traders have the following
main characteristics:
 Traders must register under business registration
regulations. The Commercial Law 2005 focuses mainly
on regulation commercial activities and therefore does
not deal with business registration. Business
registration must be done in accordance with the laws
that govern business structures, such as the Law on
Enterprise, Investment Law or Law on Cooperatives…
7 8
1.2. General concept of commercial activities
Under the Commercial Law 2005, commercial activities
are broadly defined to include all activities for profit-
making purposes, including purchase and sale of goods,
provisions of services, investment, trade promotion,
commercial intermediary activities, and other activities.
9 10
1.2. General concept of commercial activities
Other commercial activities which are not specifically
governed by the Commercial Law may be subject to
specific legislation such as the Law on Real Estate
Business, the Law on Insurance Business, the Law on
Construction, etc.
11
1. Overview of traders and
commercial activities
1.1. Traders, commercial activities’ players
1.2. General concept of commercial activities
1.2. General concept of commercial activities
The Commercial Law 2005 provides detailed regulations on the
following commercial activities:
 Sale and purchase of goods;
 Commercial services, including logistics services, goods transit
services, and commercial assessment;
 Trade promotion, including sales promotion, commercial
advertising, display and introduction of goods and services, and
trade fairs and exhibitions;
 Commercial intermediary activities, including representation of
traders, commercial brokerage, and sale and purchase of goods
by mandated dealers and commercial agent; and
 Other commercial activities, including the auction of goods,
bidding for goods or services, commercial processing, lease of
goods, and commercial franchise.
Chapter 5. Commercial Law
1. Overview of traders and commercial activities
2. Types of commercial activities
3. Breach of commercial contracts and remedies
12
2

2. Types of commercial activities
 Sale of goods
 Provision of services
 Commercial intermediary activities
 Commercial promotion activities
 Other commercial activities
13
Sale of goods
Base on the manner on which the sale is conducted, the
Commercial Law 2005 classifies the purchase and sale of
goods into two categories:
 Normal/direct sale;
 Sale of goods via commodity exchange.
15
Normal/direct sale of goods contract
The Commercial Law 2005 stipulates other aspects of the
commercial sale of goods contract. The main focus of the
Commercial Law 2005 in respect to the sale of goods
contract is to govern the right and obligations of the
seller and the buyer in performing the contract of sale.
However, the Commercial Law provides broad room for
the parties to negotiate and stipulate in the contract
terms and conditions governing their rights and
obligations. As such, many provisions in respect of the
rights and provisions of the parties, start with “unless
otherwise agreed by the parties”.
17
Sale of goods
Article 3.8 of the Commercial Law 2005 provided that the sale and
purchase of goods means a commercial activities whereby the
seller is obliged to deliver goods, transfer ownership of goods to
the purchaser, and received payment; the purchaser is obliged to
pay for the goods, received the goods, and assume ownership as
agreed.
With respect to the normal sale of goods, the Commercial Law
2005 governs domestic contracts of sale (i.e. contract purchase or
sale goods which are circulated within the custom territory of
Vietnam) and international contracts of sale if such contract is
governed by the laws of Vietnam.
Goods under Article 3.2. of the Commercial Law 2005 mean all
type of movable goods, including future goods and fixtures affixed
to land.
14
Normal/direct sale of goods contract
The contract of sale is a contract whereby the seller
transfers or agrees to transfer ownership of goods to the
buyer for a price (Article 430 of Civil Code 2015). The Civil
Code provides a number of provisions to stipulate
important aspects of civil contracts, such as the
formation of the contract, the criteria for determining the
validity of a contract, etc. These provisions also govern
the commercial sale of goods contracts, etc.
16
Normal/direct sale of goods contract
The contract of sale may be expressed in verbal and
written form or established by the conduct of the parties.
If there are particular provisions requiring a contract of
sale be made in written form (for example, contracts for
selling real estate property or international sale of goods
contracts), such provisions must be followed.
18
3
 Normal/direct sale of goods contract
The Commercial Law 2005 implies several conditions and
warranties to a contract of sale unless the parties agreed
otherwise. Example of those implied conditions and
warranties include the duty of the seller to ensure the
title of the goods (Article 45) and to assure the
intellectual property rights pertaining to the goods
(Article 36). There are provisions on the implied terms:
fitness for purpose, merchantable quality, sale by sample
and sale by description, etc.
19
Sale of goods via commodity exchange
The Commercial Law 2005 stipulates that two types of
contracts be used in commodity exchanges. They are:
Commodity forwards (“hợp đồng kỳ hạn”), and
Commodity options (“hơp đồng quyền chọn”).
21
Sale of goods via commodity exchange
Under Article 64.2 of the Commercial Law 2005, a
commodity future is an agreement hereby the seller
undertakes to deliver and purchaser undertakes to
accept goods at a future point of time.
A commodity option is an agreement hereby the
purchaser of the option had the right to purchase or sell
a certain types of goods at a pre-determined price
(referred to as contracted price) and must be pay a
certain amount of money for the purchase of this right
(referred to as the option price). The purchaser has the
option to carry out or not carry out the purchase or sale.
23
Sale of goods via commodity exchange
According to Article 63.1 of the Commercial Law 2005,
sale of goods via commodity exchange means a
commercial activity by which the parties agree to
implement a purchase and sale of a certain quantity of a
certain type of goods via a commodity exchange, in
accordance with the standards of commodity exchange
and at a price agreed upon the time at which the parties
enter into the contract, and the time of delivery is
determined to be at a future point of time.
20
Sale of goods via commodity exchange
However, the term “commodity forwards” under the Vietnamese
law does not have the same meaning as commodity forwards in
normal international practices, because internationally a
commodity forwards refers to future contracts to be traded on a
over-the-counter basic.
“Commodity forwards” as provided for in the Commercial Law
2005 is rather a “commodity future” as term used in other foreign
commodity exchanges. There is an inconsistency as to the use of
terms in Vietnamese relating to futures contract in legal and
economic researchers.
In general, “commodity forwards” means “hợp đồng kỳ hạn” in
Vietnamese, while “ commodity futures” means “hợp đồng tương
lai”.
22
2. Types of commercial activities
 Sale of goods
 Provision of services
 Commercial intermediary activities
 Commercial promotion activities
 Other commercial activities
24
4

Provision of services
Vietnamese law provides provisions to regulate:
 Logistics services;
 Goods transit services; and
 Commercial assessment services.
Logistics services
According to Article 233 of the Commercial Law 2005,
logistics services are commercial activities whereby
traders organize the performance of one or more of the
following: reception, transportation, warehousing, cargo
storage, completion of customs procedures and other
formalities and paperwork, customer consultancy,
packaging services, delivery of goods, or other services
related to goods that are compensated by service fees.

25 26

Goods transit services

Provision of services
Vietnamese law provides provisions to regulate:
 Logistics services;
 Goods transit services; and
 Commercial assessment services.
According to Article 249 of the Commercial Law 2005, goods
transit services are commercial activities that traders carry
out the transit of goods owned by foreign organizations or
individuals through Vietnamese territory for remunerations.
Transit of goods means the transportation of goods owned by
foreign organizations or individuals through Vietnamese
territory, including transshipment, portage, warehousing,
shipment separation, or alteration of modes of
transportation, along with other acts performed in the course
of transit (Article 241 of the Commercial Law 2005).

27 28

Commercial assessment services

Provision of services
Vietnamese law provides provisions to regulate:
 Logistics services;
 Goods transit services; and
 Commercial assessment services.
According to Article 254 of the Commercial Law 2005,
commercial assessment services are commercial activities
whereby a trader carries out all necessary steps to verify the
actual status of goods or services or any other matters as
requested by clients. Assessment services may be requested
in respect of one or more of the following aspects of goods or
services: quantity, quality, packaging, value of goods, origin of
goods, losses, degree of safety, standards of hygiene,
epidemic prevention, results of the provision of services,
method of the provision of services, and other matters
requested by the clients.

29 30

5
 Commercial assessment services
Only business entities which satisfy all requirements stipulated by
law and which have been granted a business registration certificate
2. Types of commercial activities
for commercial assessment services are permitted to provide
assessment services. In order to qualify, under Article 257 of the  Sale of goods
Commercial Law 2005, a business entity has to satisfy all of the
following:  Provision of services
 Being an enterprise established in accordance with laws;  Commercial intermediary activities
 Having assessors who satisfy the prescribes criteria (i.e., having an
appropriate university or college degree, having a professional  Commercial promotion activities
assessment certificate if the law in a specified area so requires;
having at least three years experience in the relevant sector); and  Other commercial activities
 Being capable of implementing the procedures and methods for
assessment of goods or services in accordance with the laws of
Vietnam and international standards or practices.

31 32

Commercial intermediary activities

Generally speaking, intermediary activities include four Commercial intermediary activities
different activities involving a trader carrying out activities
There are four following commercial intermediary
without directly purchasing and selling goods for its own
profits or providing services for a fee in a literal sense. Rather,
activities:
the traders acts on behalf of and for the interest of others for  Representation of traders;
commission. Despite their commonality, these four activities
 Commercial brokerage;
have differences.
There are four following commercial intermediary activities:  Sale and purchase of goods by mandated dealers; and
 Representation of traders;  Commercial agency.
 Commercial brokerage;
 Sale and purchase of goods by mandated dealers; and
 Commercial agency.
33 34

Representation of traders
Pursuant to Article 141.1 of the Commercial Law 2005,
representation of traders means a commercial activity
whereby a trader (referred to as the representative) is
authorized by another trader (referred to as the principal)
to conduct commercial activities in the name and under
the instructions of the latter for remuneration. This
activity require that the representative be licensed to
carry out the commercial activities that the principal
authorizes it to do.
Representation of traders
In order to carry out this commercial representation activity,
traders need to register the rights to trade in the goods that it
will trade on the principal’s behalf. Similar conditions apply to
the provision of commercial services. The relationship
between the principal and the representative is closer than
that between the principal and its agent in a commercial
agency relationship. For that reason, the law requires the
representative not to complete with its principal and imposes
a confidential duty of the representative toward the principal
that is not limited to the term of the contract, but survive
another two years after the termination of the representation
contract (Article 145.4 & 145.5 of the Commercial Law 2005).

35 36

6
 Commercial intermediary activities
 Representation of traders;
 Commercial brokerage;
 Sale and purchase of goods by
mandated dealers;
 Commercial agency.
37
Commercial brokerage
This activity differs from commercial representation in the
following important aspects: in the commercial representative,
the representative acts as authorized by the principal and in
the name of the principal, and in the commercial brokerage,
the broker facilitates its principal to enter into such a
transaction (purchase or sale of goods or provisions of
services). The broker is not allowed to carry out the
transaction (purchase or sale goods or provision of services)
unless authorized by the principal (Article 151.4 of the
Commercial Law). When the principal authorizes the broker to
conduct the transaction on the principal’s behalf, the
relationship between the parties becomes that between a
representative and a principal under a commercial
representative arrangement.
39
Sale and purchase of goods
by mandated dealers
Under Article 155 of the Commercial Law 2005, sale and
purchase of goods by mandated dealers means a
commercial activity whereby a trader (referred to as an
assignee) sells or purchases goods in his own name under
the terms agreed upon with another party (the
mandatory), for remuneration.
41
Commercial brokerage
Under Article 150 of the Commercial Law, commercial
brokerage means a commercial activity whereby a party acts,
for remuneration, as an intermediary (referred to as the
broker) between two parties wanting to sell or purchase goods
or provide commercial services (referred to as the principals)
in the course of negotiating and entering into sale and
purchase contracts or contracts for provision of services.
38
Commercial intermediary activities
 Representation of traders;
 Commercial brokerage;
 Sale and purchase of goods by
mandated dealers;
 Commercial agency.
40
Sale and purchase of goods by mandated dealers
This commercial activity differs from the commercial representation
in two material aspects:
• First, the assignee in the activity of sale and purchase of good by
mandated dealers only deals with the sale or purchase of goods,
not the provision of commercial services, whereas the
representative in the commercial representation situation may
deal with both sale and purchase of goods and provision of
services.
• Second, in commercial representation, the representative
conducts the transaction in the name of the principal and in
accordance with the principal’s instructions. In the activity sale
and purchase of goods by a mandated dealers, the assignee sells
or purchases goods in its own name though the goods (to be sold)
and the money (used to buy the goods) remain the property of
the mandator. Usually, the activity of sale and purchase of goods
by mandated dealers is utilized in import and export transactions
where the owner of the goods and the party who wants to import
the goods is neither licensed to directly export/import the goods
nor expert in dealing with a particular type of goods.
42
7
 Commercial intermediary activities Commercial agency
Under Article 166 of the Commercial Law 2005,
 Representation of traders; commercial agency means a commercial activity whereby
 Commercial brokerage; the agent, in its own name, sells or purchases goods for
the principal or provides services of the principal to
 Sale and purchase of goods by
customers for remuneration. The agency contract is one in
mandated dealers;
which principal authorizes the agent to distribute or
 Commercial agency. purchase goods for the principal or to provide services of
the principal to customers. Title to the goods never
transfers to agent.

43 44

Commercial agency
Commercial agency appears similar to sale and purchase of goods 2. Types of commercial activities
by mandated dealers. However, the scope of commercial agency is
broader than mandated dealership as the former deals with both
 Sale of goods
sale and purchase goods as well as provision of services. Also, the
activity of sale and purchase of goods by mandated dealers is  Provision of services
usually suitable for a one-off transaction whereby the mandator
employs the assignee to sell or purchase of a volume of the goods in  Commercial intermediary activities
which the mandator does not specialize. Commercial agency is  Commercial promotion activities
usually used in distribution services which may last for longer time.
For that reason, the law requires that in the commercial agency  Other commercial activities
activity, both the principal and the agent must be licensed to trade
in the related goods or services. In the mandated dealers, only the
assignee is required to be licensed to trade in the related goods.

45 46

Commercial promotion activities Sale promotion

Under Article 88.1 of the Commercial Law 2005, sales
Commercial promotion activities include: promotion means a commercial promotion activity by which
 Sales promotion; traders promote the purchase and sale of goods or the
 Commercial advertising; provision of services by providing certain benefits to
customers.
 Display and introduction of goods and services; and
Sale promotion can be conducted by a trader who trades in the
 Trade fairs and exhibitions goods or services to be promoted or by a trader who engages
Subject to the application of the Commercial Law 2005. in providing sale promotion services under a provision of
service contract with the trader whose goods or services are
promoted.

47 48

8
 Sale promotion
Under Article 92 of the Commercial Law 2005, sale promotion can
be conducted in one of the following forms:
• Giving samples of goods or providing samples of services to
customers for trial use free of charge.
• Presenting goods as gifts or providing free-of-charge services to
customers.
• Selling goods or providing services at prices lower than goods
sale prices or service provision charge rates previously applied
during the period of sale promotion already registered or
announced. In case of goods or services subject to the State
management over their prices, the sale promotion in this form
shall comply with regulations of the Government.
• Selling goods or providing services together with coupons that
allow customers to enjoy one or several benefits.
• Selling goods or providing services together with prize-contest
entrance tickets to customers, for purpose of selecting prize
winners according to the rules and prizes already announced.
49
Commercial promotion activities
Commercial promotion activities include:
 Sales promotion;
 Commercial advertising;
 Display and introduction of goods and services; and
 Trade fairs and exhibitions
Subject to the application of the Commercial Law 2005.
51
Commercial promotion activities
Commercial promotion activities include:
 Sales promotion;
 Commercial advertising;
 Display and introduction of goods and services; and
 Trade fairs and exhibitions
Subject to the application of the Commercial Law 2005.
53
Sale promotion
Under Article 92 of the Commercial Law 2005, sale promotion can
be conducted in one of the following forms:
• Selling goods or providing services together with opportunities
for customers to participate in games of chance, the participation
in which comes after the purchase of goods or services and the
winning of prizes depends on the luck of participants according to
the rules and prizes already announced.
• Organizing programs for frequent customers whereby gifts are
presented to customers on the basis of the quantities or values of
goods purchased or services used by such customers and
expressed in forms of customers’ cards, coupons acknowledging
the purchase of goods or services, or other forms.
• Organizing cultural, artistic or entertainment programs or other
events for customers for the purpose of sale promotion.
• Other forms of sale promotion if approved by the State
management agency in charge of commerce.
50
Commercial advertising
According to Article 102 of the Commercial Law 2005, commercial
advertising means commercial promotion activity conducted by
traders and aimed at introducing to customers their goods and
service business activities.
Under Article 106 of the Commercial Law 2005, means of
commercial advertising include:
• The mass media;
• Means of communications;
• Publications of all kinds;
• All kinds of boards, signs, banners, panels, posters, fixed objects
or means of transportation and other movable objects;
• Other means of commercial advertising.
52
Display and introduction
of goods and services
According to Article 117 of the Commercial Law 2005,
display and introduction of goods and services mean
commercial promotion activities carried out by traders by
which goods and/or services and documents thereon to
introduce such goods and/or services to customers.
54
9
 Display and introduction
of goods and services
Traders who operate in Vietnam, branches of Vietnamese
traders, and Vietnam-based branches of foreign traders shall
have the right to display and introduce goods and/or services
by themselves or hire traders engaging in goods/services
display and information services to display and introduction
services to display and introduce their goods and/or services
(Article 118.1 of the Commercial Law 2005).
Under Article 118.3 of the Commercial Law 2005, foreign
traders that are not yet licensed to trade in Vietnam may hire
traders engaging in goods/services display and introduction
services to display and introduce their goods and/or services in
Vietnam.
55
Trade fairs and exhibitions
Under Article 129 of the Commercial Law 2005, trade fairs
and exhibitions mean commercial promotion activities
conducted in a concentrated manner at particular
locations and for given periods of time by which traders to
display and introduce their goods and/or services for the
purpose of promoting them and seeking opportunities for
entering into contracts for sale and purchase of goods and
provisions of services.
57
2. Types of commercial activities
 Sale of goods
 Provision of services
 Commercial intermediary activities
 Commercial promotion activities
 Other commercial activities
59
Commercial promotion activities
Commercial promotion activities include:
 Sales promotion;
 Commercial advertising;
 Display and introduction of goods and services; and
 Trade fairs and exhibitions
Subject to the application of the Commercial Law 2005.
56
Trade fairs and exhibitions
Traders who operate in Vietnam, branches of Vietnamese
traders, and Vietnam-based branches of foreign traders have
the right to directly organize trade fairs and exhibitions for
goods and services they trade in or hire traders providing trade
fairs and exhibitions services to do so (Article 131.1 of the
Commercial Law 2005).
Under Article 131.3 of the Commercial Law 2005, foreign
traders that are not yet licensed to trade in Vietnam may
directly participate in trade fairs and exhibitions organized by
Vietnamese traders which provide trade fairs and exhibitions
services. If foreign trade fairs want to organize a trade fair and
exhibition in Vietnam, they must hire Vietnamese traders
engaging in trade fairs and exhibitions services to do so.
58
Other commercial activities
The Commercial Law 2005 provides detailed provisions on
a number of other commercial activities, including:
 Auction of goods;
 Bidding for goods or services;
 Commercial processing;
 Lease of goods; and
 Commercial franchising.
60
10
 Auction of goods
Under Article 185 of the Commercial Law 2005, auction of goods Other commercial activities
means a commercial activity whereby sellers by themselves conduct
public sale of goods or hire auction organizers to do so in order to The Commercial Law 2005 provides detailed provisions on
select the purchaser that offer the highest prices. a number of other commercial activities, including:
Auctions of goods shall be performed by either of the following two  Auction of goods;
modes:
• Upward bidding mode, which is an auctioning mode whereby the
 Bidding for goods or services;
person who offers the highest price as compared with the  Commercial processing;
reserve price shall have the right to purchase the auctioned  Lease of goods; and
goods;
• Downward bidding mode, which is an auctioning mode whereby  Commercial franchising.
the person who first accepts the reserve price or the lower price
next to the reserve price shall have the right to purchase the
auctioned goods.
61 62

Bidding for goods or services

Under Article 214.1 of the Commercial Law 2005, bidding
for goods or services means a commercial activity
whereby a party purchases goods or services through
bidding (referred to as bid solicitor) in order to select,
among traders participating in the bidding (referred to as
bidders), a trader that satisfies the requirements set forth
by the bid solicitor and is selected to enter into and
perform a contract (referred to as bid winner).
Of note, the provisions on commercial bidding in the
Commercial Law 2005 shall not apply to bidding for public
procurement which procurement is subject to the
application of he Law on Bidding 2013.
63
Bidding for goods or services
Differing from auction for goods which is a method of
public sale of goods, bidding for goods or services applies
to the purchase of goods and services. The bid solicitors
are those who want to purchase goods or to consume
services by way of organizing a forum for those who are
qualified to participate in order to purchase the goods or
services economically and effectively.
64

Bidding for goods or services

Other commercial activities
There are two modes of bidding:
• One dossier bidding; and The Commercial Law 2005 provides detailed provisions on
• Two dossier bidding. a number of other commercial activities, including:
While the one dossier bidding requires bidders to submit one  Auction of goods;
bidding dossier which consists of technical and financial proposals,
the two dossier bidding requires bidders to submit two separate  Bidding for goods or services;
bidding dossiers simultaneously, of which one dossier consists of  Commercial processing;
technical proposals and the other consists of financial proposals. In
two dossier bidding, the technical proposals shall be opened first.  Lease of goods; and
Two dossiers bidding is usually used in cases where the bid solicitor  Commercial franchising.
more focuses on the technical aspect of the goods or services and
does not want to be influenced from the price when examining the
technical specifications of the goods.

65 66

11
 Commercial processing
According to Article 178 of the Commercial Law 2005,
commercial processing means a commercial activity
whereby a processor uses part or whole of raw materials
and materials supplied by the processee to perform one
or several stages of the production process at the latter
request for the purpose of receiving remuneration.
The processing contracts must be made in writing or in
other forms of equivalent legal validity.
67
Lease of goods
According to Article 269 of the Commercial Law 2005,
lease of goods means commercial activities whereby one
party (the lessor) transfers the right to possess and use
goods to another party (the lessee) for a certain period of
time for rental fees.
69
Other commercial activities
The Commercial Law 2005 provides detailed provisions on
a number of other commercial activities, including:
 Auction of goods;
 Bidding for goods or services;
 Commercial processing;
 Lease of goods; and
 Commercial franchising.
71
Other commercial activities
The Commercial Law 2005 provides detailed provisions on
a number of other commercial activities, including:
 Auction of goods;
 Bidding for goods or services;
 Commercial processing;
 Lease of goods; and
 Commercial franchising.
68
Lease of goods
Unless the parties to the lease agreement provide otherwise, the
Commercial Law 2005 provide a number of provisions to regulate
the rights and obligations of the lessor and the lessee.
Of note, during the term of the lease, even though the lessor still
has the right to dispose the goods under the lease, the validity of
the lease agreement shall not be affected by the disposal (Article
283 of the Commercial Law).
In other words, within the term of the lease agreement, if the lessee
decides to sell or otherwise transfer its ownership over the goods to
another party, the lessee must ensure that the transferee remains
liable under the lease agreement. Moreover, differing from a civil
lease of assets, Article 282 of the Commercial Law provides that
unless otherwise agreed, all benefits arising from the goods during
the term of the lease shall belong to the lessee. This provision
supports the lessee’s purpose of entering into the lease of goods
(i.e, for-profit purposes).
70
Commercial franchise
Article 284 of the Commercial Law defines franchising as a
commercial arrangement under which a party (the franchisor)
grants another party (the franchisee) the right to carry out the
business of selling its goods or supplying its service under the
following conditions:
 The franchisee may carry out the business under a format
determined by the franchisor and may fix affix the trademarks,
trade names, business logos, slogans and advertisements of the
franchisor at the franchisee’s business premises; and
 The franchisors has the rights control and assist the franchisee to
carry out the franchised business.
Related to the regulations on franchising can also be found in the
Intellectual Property Law 2005 and the Technology Transfer Law
2006.
72
12

Chapter 5. Commercial Law
1. Overview of traders and commercial activities
2. Types of commercial activities
3. Breach of commercial contracts and remedies
73
Breach of commercial contracts
and remedies
According to Article 3.13 of the Commercial Law,
substantial breach is a breach that causes damage to the
other party to an extent that renders the non-defaulting
party unable to achieve its purpose of entering into the
contract.
The definition of substantial breach as provided in fact
provides flexibility for the parties and the dispute
settlement mechanism to determine what breach could
amount to a substantial breach.
75
Breach of commercial contracts and remedies
Of the foregoing, specific performance and damages for loss are
generally applicable to all cases.
Damages of loss will be imposed if the following grounds are
satisfied: (i) there is a breach of contract; (ii) loss or damage has
occurred; and (iii) there is a causal link between the breach and the
loss or damage.
According to Article 302.2 of the Commercial Law, the awards of
damage will cover the value of the factual and direct loss suffered
by the aggrieved party due to the breach and the direct profit which
the aggrieved party would have earned if such breach had not been
committed.
Under Article 304 of the Commercial Law, the party claiming
damages shall bear the burden of proof of the loss claimed, of the
extent of the loss caused by the breach, and of the direct profit
amount which the aggrieved party would have earn if the breach
had not been committed.
77
Breach of commercial contracts
and remedies
Breach of commercial contracts means the failure of the
party to perform, fulfill, or properly perform its obligations
as stipulated in the contract between the involved parties
or as provided for by the provisions of law.
The Commercial Law 2005, for the first time, distinguishes
between substantial/fundamental breach and non-
substantial breach for the purpose of determining types of
remedies available. In other words, only substantial
breaches are subject to some types of remedies.
74
Breach of commercial contracts and remedies
The Commercial Law 2005 provides a wide range of remedies and
permits considerable autonomy to the relevant parties in deciding
such remedies. Remedies available for commercial transactions
consist of:
• Specific performance.
• Penalty for breach.
• Damages for loss.
• Temporary cessation of performance of contracts.
• Termination of performance of contracts.
• Rescission of contracts.
• Other remedies that the parties agree upon, provided that such
remedies are not contrary to the fundamental principles of the
laws of Vietnam, or to any international treaty of which Vietnam
is a member, or to international commercial practice.
(Article 292 of the Commercial Law 2005)
76
Breach of commercial contracts
and remedies
Penalty for breach can be applied only if the parties have
agreed on the use and levels of such penalty. Except for
cases specified in the Article 266 of the Commercial Law,
the agreed penalty amount shall not exceed 8% of the
obligation value that is breach.
78
13
 Breach of commercial contracts
and remedies
Temporary cessation of performance of contract, termination
of performance of contracts, or rescission of contract can be
applied in either of the following two cases:
(i) Upon occurrence of an act of breach which the parties
have agreed will be a condition resulting in temporary
cessation of performance of contract, termination of
performance of contract, or rescission of contract; and
(ii) When one party commits a substantial/fundamental
breach of the contractual obligations. It is important to
note that the rights of a party to claim damage for loss for
a breach of contract by the other party shall be preserved
even if the other remedies have been applied.
79
Breach of commercial contracts
and remedies
The Commercial Law 2005 also sets forth cases in which
defaulting party in immune from liability, namely:
 An event that the parties have agreed will give rise to
immunity from liability;
 An event of force majeure;
 A breach by one party which was totally due to the other
party;
 A breach by one party which was due to implementation of
a decision of a State administrative body of which the
parties could not have know at the time of entering into the
contract.
80

Breach of commercial contracts

and remedies
Moreover, the Commercial Law 2005 provides statues of the
limitation which limit the time on which an aggrieved party
must lodge a complaint against the defaulting party, beyond
which the former will forfeit the right to initiate an action in
arbitration or court proceedings against the other party.
Generally speaking, the statue of limitation for taking a legal
action is two years commencing from the time the dispute
arises, except for cases involving logistics services. Article
237.1.f of the Commercial Law 2005 provides that a lawsuit
against a logistics service provider must be initiated within
nine months from the date on which the goods are delivered.
81

14
 Content Chapter 6. Business-related
Chapter 1. Introduction to Law Dispute Resolutions
Chapter 2. Civil Law Traders are free to choose method and forum for dispute
Chapter 3. Contract Law settlement if the dispute is a commercial dispute. Based
on the nature of commercial dispute, the parties
Chapter 4. Law on Business Organizations
concerned are encouraged to pursue direct negotiation
Chapter 5. Commercial Law and mediation before attempting attribution and
Chapter 6. Business-related Dispute Resolutions litigation. Because of their nature, there are almost no
legal rules that regulate the procedures of negotiation
Chapter 7. Labor Law
and mediation as methods of business-related dispute
Chapter 8. Intellectual Property Law resolutions. However, the law provide detailed rules and
Chapter 9. International Law how commercial disputes can be handled by courts and
arbitration.
1 2

Chapter 6. Business-related The commercial disputes settlement

Dispute Resolutions in the court
 The commercial disputes settlement The courts that have jurisdiction to handle commercial
in the court disputes at first instance are either the District Court or
the Economic Division of the Provincial Court, depending
 The commercial disputes settlement
on the nature, not the value, of the dispute.
by commercial arbitration

3 4

The commercial disputes settlement The commercial disputes settlement

in the court
According to Article 30 of the Civil Procedures Code 2015, the
following commercial disputes are handles by the District Court as
the court of first instance:
 Disputes arising from business or trade activities among
individuals and/or organizations with business registration,
which are all for the purpose of profits.
 Disputes over intellectual property rights or technology transfers
among individuals or organizations, which are all for the
purposes of profits.
 Disputes between persons who are not members of a company
but involve in transaction in transfer of capital holding and the
company and/or its members.
5 6
in the court
According to Article 30 of the Civil Procedures Code 2015, the
following commercial disputes are handles by the District Court as
the court of first instance:
 Disputes between a company and its members; disputes
between a limited liability company and its manager or between
a joint-stock company and members of its Board of Directors, its
Director or its General Director, or among members of a
company regarding the establishment, operation, dissolution,
merge, consolidation, total division, partial division, property
transfer and/or organizational transformation of the company.
 Other civil disputes relating to business or trade activities, except
for cases within the jurisdiction of other agencies and
organizations as prescribed by law.

1
 The commercial disputes settlement
in the court
Where the courts settles the case, it must follow the
applicable procedures set out by the Civil Procedures
Code.
Conciliation is a mandatory part of the trial procedures.
Before the dispute goes to official hearing, the parties
have to first attempt conciliation of their case before a
judge. The judge will act as a conciliator between the
parties. If the conciliation is successful, the judge will then
issue a decision acknowledge the mutual settlement
between the parties. However, the decision can only be
issued if the parties have reached total agreement to the
dispute.
7 8
The commercial disputes settlement
in the court
There are also cases that are, under Article 207 of the
Civil Procedures Code 2015, incapable of being
reconciled. They are cases where:
• The defendants or the persons with relevant interests
and duties are intentionally absent though having been
duly summoned twice by courts.
• The involved parties cannot take part in the mediation
for plausible reasons.
• One of involved parties applies for non-mediation.
(Article 207 of Civil Procedures Code 2015)
9 10
The commercial disputes settlement
in the court
Except for the decision acknowledging settlement
between the parties, first trial judgments can be appealed
by the parties to the dispute or be requested for
reconsideration by an appeal hearing by a competent
authority within 15 days from the date on which it is
made.
11
The commercial disputes settlement
in the court
There are certain cases that are not eligible conciliation.
Those are cases that involve:
 Petition for compensation of damages caused to State
properties, or
 Transactions that are illegal or contrary to social
morality.
(Article 206 of Civil Procedures Code 2015)
The commercial disputes settlement
in the court
During the trial but before the court delivers its
judgments, the parties may also reach a mutual
settlement. If such settlement is voluntary and not illegal
or not contrary to social morality, the court will issue a
decision acknowledging the settlement between the
parties. The decision to acknowledge settlement between
the parties is legally effective after being issued and is not
appealable.
The commercial disputes settlement
in the court
Valid and binding judgments may be challenged through
the judicial review procedures if there are grounds for
appeal according to cassation procedures or to reopening
procedures.
12
2
 The commercial disputes settlement
in the court
A legally effective judgment/decision of the Court shall be appealed
against according to cassation procedures when there is one of the
following grounds:
 Conclusion in the judgment/decision is incompatible with the
objective details of the cases, causing damage to legitimate
rights and interests of the involved parties;
 There are serious violations against procedures that prevent
involved parties from executing their procedural rights and
obligations, as the result, their legitimate rights and interests are
not protected as prescribed in law;
 There are mistakes in the application of law leading to the
issuance of wrong judgments/decisions, causing bad effect to
legitimate rights and interests of involved parties, infringing
upon public benefits, State benefits, legitimate rights and
interests of the third parties.
(Article 326 of Civil Procedures Code 2015)
13
Chapter 6. Business-related
Dispute Resolutions
 The commercial disputes settlement
in the court
 The commercial disputes settlement
by commercial arbitration
15
The commercial disputes settlement
by commercial arbitration
According to Article 2 of Law on Commercial Arbitration 2010,
arbitration has jurisdiction to resolve:
 Dispute arising from commercial activities,
 Dispute arising between parties at least one of whom is
engaged in commercial activities , and
 Other disputes which can be resolved by arbitration
according to the laws of Vietnam.
Under Article 3.1, commercial activities are defined as
transactions involving goods, the provision of services,
investment, trade promotions, and other activities for profit-
making purposes.
17
The commercial disputes settlement
in the court
Legally effective judgments/decisions shall be appealed against
according to reopening procedures when there is one of the
following grounds:
 Important details of the case were newly discovered which the
involved parties could not have known in the course of resolving
the case;
 There are grounds to prove that the conclusions of the expert
witnesses and translations of interpreters were untruthful or
evidences were falsified;
 Judges, People’s Jurors or procurators intentionally diverted the
case files or deliberately made unlawful conclusions;
 The criminal, administrative, civil, marriage and family, business,
commercial or labor judgments/decisions of Courts or decisions
of State agencies on which the Courts based themselves to
resolve the cases had already been annulled.
(Article 352 of Civil Procedures Code 2015)
14
The commercial disputes settlement
by commercial arbitration
Arbitration as a means to resolve business-related dispute is a
relatively long-run development in Vietnam. However, until
recently, the National Assembly adopted the first statue
providing procedures for settling the commercial disputes
through arbitration in Vietnam, which is the Law on
Commercial Arbitration in 2010.
This Law also applies to international arbitration organization
operating in Vietnam. The Law on Commercial Arbitration
2010 regulates that the court will not review the merits of a
dispute if there is an arbitration agreement unless the
arbitration agreement is null and void.
16
The commercial disputes settlement
by commercial arbitration
Under Article 5 and 16.1 of Law on Commercial
Arbitration 2010, for arbitration take place, there must be
arbitration clause in the under lying contract or a separate
arbitration agreement (each called an arbitration
agreement) in which the parties agree to arbitration and
the method of arbitration. The arbitration agreement
must be in writing and entered into by the parties prior
to, or after, the dispute occurs.
18
3
 The commercial disputes settlement
by commercial arbitration
According to Article 16.2 of Law on Commercial Arbitration 2010,
the following forms of agreement may also be regarded as written
form:
 Agreement made through communication between the parties
by telegram, fax, telex, email or other forms provided for by law;
 Agreement made through exchange of written information
between the parties;
 Agreement recorded in writing by a lawyer, notary public or
competent institution at the request of the parties;
 In their transactions, the parties make reference to a document
such as a contract, document, company charter or other similar
documents which contains an arbitration agreement;
 Agreement made through exchange of petitions and self-defense
statements which reflect the existence of an agreement
proposed by a party and not denied by the other party.
. 19
The commercial disputes settlement
by commercial arbitration
Under Article 19 of Law on Commercial Arbitration 2010,
a clause in a contract creating an arbitration
agreement/clause is entirely separate and independent
from that contract, so that any amendment, extension, or
cancellation of the contract or the invalidity of the
contract will not have any effect on the validity of the
arbitration clause.
21
The commercial disputes settlement
by commercial arbitration
The arbitral panel can be called on to mediate the
dispute. In case of successful mediation, upon request of
the parties, the arbitral panel will make the minutes of
the successful mediation and issue a decision to recognize
such settlement. Minute of a successful mediation must
then be signed by the parties and the arbitrators. A
decision recognizing successful mediation from the
arbitral panel is final and enforceable by and against the
parties.
23
The commercial disputes settlement
by commercial arbitration
If an arbitration agreement already exist, the court in Vietnam must
refuse to hear a legal action brought by one of the parties to the
court, unless the arbitration agreement has become invalid. This can
happen if:
 The dispute arises outside of the jurisdiction of arbitration as
discussed above (Article 2 of Law on Commercial Arbitration
2010);
 The person who signed the arbitration agreement did not have
the authorization to do;
 A party to the arbitration agreement lack of full civil act capacity;
 The form of the arbitration agreement does not comply with the
requirements set out by law;
 One of the parties was deceived, threatened, or coerced during
the process of forming the arbitration agreement and that party
requests to declare the arbitration agreement void; or
 The arbitration agreement is contrary to the provisions of law.
(Article 18 of Law on Commercial Arbitration) 20
.
The commercial disputes settlement
by commercial arbitration
The parties to a dispute can select an arbitration centre or
establish an ad hoc arbitral panel consisting of three
arbitrators or a single arbitrator to resolve the dispute.
The parties are free (and in fact, are generally
encouraged) to reconcile a dispute. In case of a successful
reconciliation, upon the parties’ request, the arbitral
panel will then suspend the proceedings.
22
The commercial disputes settlement
by commercial arbitration
The arbitral award is final and binding on the parties. But, if one
party does not voluntarily comply with award, the party wishing to
enforce the award may request the relevant provincial judgment
enforcement body to enforce the arbitral award.
On order for an ad hoc arbitral award to be enforced in Vietnam, it
must be registered with a competent court. Either party can request
the court for registration. Of note, the registration is only for the
purpose of enforcement by the civil judgment enforcement agency
in Vietnam.
The time limit for registration is one year from the date of issuance
of the arbitral award. The court that has the authority to register the
award is the provincial court where the arbitral panel announces
the award.
24
4
 Content
Chapter 1. Introduction to Law
Chapter 2. Civil Law
Chapter 3. Contract Law
Chapter 4. Law on Business Organizations
Chapter 5. Commercial Law
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law
Chapter 8. Intellectual Property Law
Chapter 9. International Law
1 2
1. Employment relationship
 Employee
 Employer
 Exclusion
3 4
The Employee
For foreign employees, the criteria are different. According to
Article 151 of Labor Code, a foreigner can become an employee in
Vietnam if he/she meets the following conditions:
 Has full civil capacity for civil acts;
 Possesses specialized and technical skills, and is healthy enough
to fulfill the work requirements;
 Not previously convicted of a crime or currently subject to
investigation for a criminal offence in accordance with the law of
Vietnam or the law of a foreign country; and
 Has a work permit issued by the competent Vietnamese
authority, unless qualifying for an exemption.
The exemptions are regulated in Article 154 of Labor Code.
5 6
Chapter 7. Labor Law
1. Employment Relationship
2. Individual Labour Contract
3. Labour Outsourcing
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike
The Employee
Under Vietnamese law, employee means a person who
works for an employer as agreed upon between the two
parties, is paid wage, and is managed, directed and
supervised by the employer.
The minimum working age prescribed for an employee
is full 15 years.
(Article 3.1 of Labor Code 2019).
The Employer
Vietnamese labor law does not provide a general
definition of employer beyond individual employers. An
employer can be an enterprise, agency, organization, co-
operative, business household, or individual who hires or
employs labor pursuant to a labor contract.
For an individual, the law requires him/her to have full
capacity for civil acts if he/she wants to become an
employer.
1
 Exclusions
Generally, Vietnamese labor law does not govern the
labor relationship of states officials, elected and
appointed officials, members of units of the people’s
armed forces and police force, members of public
organizations, members of other political and social
organizations, and members of co-operatives. However,
a number of the provisions of the labor law do apply to
such labor relationships, including provisions on working
hours, rest time, salary, and social insurance.
7 8
2. Individual Labor Contract
 Contract Formation
 Contents of Contract
 Probation
 Performance of Contract
 Terminations
9 10
Contract Formation
According to Article 20 of Labor Code, a labor contract must
take one of the following types:
• Indefinite-term labor contract, which is a contract in which
the two parties do not determine its term and time of
termination;
• Definite-term labor contract, which is a contract in which
the two parties determine its term and time of termination
within 36 months from the date the contract takes effect.
11
Chapter 7. Labor Law
1. Employment Relationship
2. Individual Labour Contract
3. Labour Outsourcing
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike
Contract Formation
According to Article 13 of Labor Code, labor contract means an
agreement between an employee and an employer on pay,
working conditions, and the rights and obligations of each
party.
Under Article 14 of Labor Code, a labor contract must be in
writing and must include a duplicate, with each party retaining
one copy. An oral agreement may be entered into for certain
temporary work that has a duration of less than three (3)
months.
The Labor Code does not specify a standard form of labor
contract. The law permits the employer to prepare a form of
labor contract based on the principle contents mandated by
law.
Contract Formation
When a labor contract referred to at Point b, Clause 1 of the
Article 20 expires and the employee continues working:
• Within 30 days from the date of expiration of the contract,
the two parties shall sign a new labor contract; pending the
signing of a new labor contract, the rights, obligations and
interests of the two parties must comply with the old
contract;
• Past the above 30-day time limit, if the two parties do not
sign a new labor contract, the contract entered into under
Point b, Clause 1 of this Article will become an indefinite-
term labor contract;
12
2
 Contract Formation
When a labor contract referred to at Point b, Clause 1 of the
Article 20 expires and the employee continues working:
• In case the two parties sign a new labor contract with a
definite term, they may not sign another definite-term labor
contract; if the employee continues working after the
expiration of this contract, the two parties shall sign an
indefinite-term labor contract, except labor contracts
entered into by persons hired to work as directors of state
capital-invested enterprises and the cases specified in
Clause 1, Article 149, Clause 2, Article 151, and Clause 4,
Article 177, of this Code.
13
Contents of Contract
Under Vietnamese labor law, the employee and employer are
generally free to agree on the content of an individual labor
contract. However, the agreed terms and conditions will only be
valid if they comply with the extensive system of employee
protection rules which are superior to labor contract, in particular
mandatory law and collective labor agreement (CLA).
The main duties arising from labor contract are duty of the
employer to pay the employee’s salary and the duty of the
employee to personally perform his/her work. There are further
implied duties, such as the employer’s obligation to protect the life,
health and safety of its employees, and the employee’s duties to
observe the employer’s instruction, to keep business secret
confidential, to protect the employer property, and not to compete
with the employer during the course of the employment
relationship.
15
2. Individual Labor Contract
 Contract Formation
 Contents of Contract
 Probation
 Performance of Contract
 Terminations
17
2. Individual Labor Contract
 Contract Formation
 Contents of Contract
 Probation
 Performance of Contract
 Terminations
14
Contents of Contract
According to Article 21 of Labor Code, a labor contract must have
the following principal contents:
• Name and address of the employer or the lawful representative
of the employer;
• Full name, date of birth, gender, residence address, identity card
number or other lawful documents of the employee;
• Job and workplace;
• Term of the labor contract;
• Wage, form of wage payment, deadline for wage payment, wage-
based allowances and other additional payments;
• Regimes for promotion and wage raise;
• Working time, rest time;
• Labor protection equipment for the employee;
• Social insurance and health insurance;
• Training, retraining and occupational skill improvement.
16
Probation
The probation period shall be agreed upon by the two parties based
on the nature and complexity of the job(s) but probation shall be
applied only once for each job, and is prescribed as follows:
• Not exceeding 180 days, for enterprise managers defined in the
Law on Enterprises and Law on Management and Use of State
Capital Invested in Production and Business at Enterprises;
• Not exceeding 60 days, for holders of job titles requiring
professional and technical qualifications of collegial or higher
degree;
• Not exceeding 30 days, for holders of job titles requiring
professional and technical qualifications of intermediate degree,
or for technical workers and operation employees; or,
• Not exceeding 6 working days, for other jobs.
(Article 25 of Labor Code)
18
3
 Performance of Contract
2. Individual Labor Contract
In principal, whenever the labor contract is effective, the
 Contract Formation contracting parties are responsible to fully perform the
 Contents of Contract contract until the contract expires or the parties agree to
terminate it. However, in several cases, the law permits
 Probation
the parties amend the contract. Amendment of a labor
 Performance of Contract contract involves a change of employments conditions,
 Terminations whether to an employee’s job, place of work, salary, or an
employee’s temporary transfer to another job.

19 20

• When meeting with sudden difficulties such as natural disaster,
Performance of Contract
 Assignment of employees to perform jobs
other than those stated in labor contracts
 Suspension of labor contracts
21
Performance of Contract
fire or dangerous epidemic, or taking measures to prevent and
respond to an occupational accident or disease or an electricity
or water-related incident, or to meet production and business
needs, the employer may temporarily assign the employee to
perform a job other than that stated in the labor contract
provided that the assignment period does not exceed 60
accumulated working days within 1 year; a longer assignment
period shall be agreed in writing by the employee.
The employer shall specify in the internal working regulations
cases in which, to meet production and business needs, it/he/she
may temporarily assign the employee to perform a job other than
that stated in the labor contract.
(Article 29 of the Labor Code)
22

Performance of Contract
• At least 3 working days before temporarily assigning the
employee to perform a job other than that stated the labor
contract as prescribed in Clause 1 of this Article, the employer
shall inform such assignment to the employee, clearly stating the
duration of temporary work, and assign a job which must be
suitable to the employee’s health and gender salary.
(Article 29 of the Labor Code)
23
Performance of Contract
• The employee who is assigned to perform a job other than that
stated in the labor contract will receive a wage for the new job. If
the wage for the new job is lower than the wage paid under the
labor contract, the employee shall be paid the wage under the
labor contract for 30 working days. The wage for the new job
must be at least equal to 85% of the wage paid under the labor
contract but must not be lower than the minimum wage.
• For the employee who refuses to temporarily perform a job other
than that stated in the labor contract for over 60 accumulated
wage in case of work suspension within 1 year and has to stop
working, the employer shall give him/her a wage in case of work
suspension in accordance with Article 99 of this Code.
(Article 29 of the Labor Code)
24

4
 Performance of Contract Performance of Contract
Cases of suspension of a labor contract:
Cases of suspension of a labor contract:
• The employee has to perform military service or perform the
obligation to join militia and self-defense forces; • The employee is authorized to exercise the rights and perform
the responsibilities of a representative of the state owner of state
• The employee is held in custody or temporary detention in
capital amounts in the enterprise;
accordance with the criminal procedure law;
• The employee is authorized to exercise the rights and perform
• The employee has to serve a decision on application of the
the responsibilities of the enterprise with regard to the
measure of consignment to a reformatory, compulsory drug
enterprise’s capital amount invested in another enterprise;
detoxification center or compulsory education institution;
• Other cases as agreed upon by the two parties.
• The female employee is pregnant as prescribed in Article 138 of
this Code; During the suspension period of a labor contract, the employee is
not entitled to the wage as well as rights and interests stated in the
• The employee is appointed as manager of a single-member
contract, unless otherwise agreed upon by the two parties or
limited liability company with 100% charter capital held by the
prescribed by law.
State;
(Article 30 of the Labor Code)
(Article 30 of the Labor Code) 25 26

Terminations
2. Individual Labor Contract Termination of a labor contract may occur as a result of
 Contract Formation different legal grounds which, broadly speaking, may be
classified in two groups.
 Contents of Contract
One group includes situations where the contract is
 Probation terminated based on the parties’ consent or due to the
 Performance of Contract occurrence of certain events.
 Terminations The other group includes situations where the labor
contract is terminated by the one of the contracting
parties.

27 28

Terminations
Terminations In addition, the employer is entitled unilaterally to terminate the
labor contract as stipulated in Article 36 of the Labor Code.
Article 34 of the Labor Code provides 13 events of In cases of restructuring, change of technology, or changes for
economic reasons, if the employer is unable to offer new jobs and
termination under which a labor contract can be must retrench employees, the employer can terminate the labor
terminated. contract and pay allowances to retrenched employees (Article 42 of
the Labor Code).
Mergers and acquisitions, a growing phenomenon in Vietnam, are
addressed by Article 43 of the Labor Code, which clarifies the
continuing validity of incumbent workers’ labor contract. However, if
the new employer does not want to continue to use the acquired
company’s employees after a merger and acquisition, the new
employer has the right to terminate the labor contracts and pay
redundancy allowances to retrenched employees.
The law also provides several cases in which the employer cannot
unilaterally terminate the labor contract in Article 37 of the Labor
Code.
29 30

5
 Terminations Chapter 7. Labor Law
In contrast, the employer is entitled unilaterally to 1. Employment Relationship
terminate the labor contract as stipulated in Article 36 of 2. Individual Labour Contract
the Labor Code. 3. Labour Outsourcing
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike

31 32

3. Labor Outsourcing Chapter 7. Labor Law

The term “labor outsourcing” as defined in Article 52.1 of the Labor 1. Employment Relationship
Code. Labor outsourcing (Labor lease) means a case in which the
employee enters into a labor contract with the employer being a 2. Individual Labour Contract
labor leasing enterprise, then he/she is assigned to work for and is 3. Labour Outsourcing
managed by another employer while maintaining industrial
relations with the former employer. 4. Collective Labor Agreement
The salary of an outsourced employee must not be less than the 5. Working Conditions, Salary and Hours
salary of an employee with the same professional qualifications and
performing the same and similar job at the organization using the 6. Discipline and Material Liabilities
service. At any point, the organization using the services may agree
with the employee and the labor outsourcing enterprise to officially
7. Social Insurance
recruit the employee Article 55 of the Labor Code). 8. Labour Disputes and Strike

33 34

4. Collective Labor Agreement Trade Union

 Trade Union The employer is not responsible for setting up an internal
trade union. Rather, the trade union in the province where
 Dialogue at the workplace and the company is located must take the initiative. The
collective labor bargaining employer is only responsible for creating favorable
 Collective Labor Agreement conditions for employees to set up an internal trade
union. If there is no internal trade union in the company,
the municipal/provincial trade unions may perform and
exercise the statutory rights of the internal trade union.

35 36

6
 4. Collective Labor Agreement
 Trade Union
 Dialogue at the workplace and
collective labor bargaining
 Collective Labor Agreement
Dialogue at the workplace and
collective labor bargaining
The Labor Code requires the employer to encourage
dialogue in the workplace. The purpose of the dialogue is
for employees to share information and to create a better
understanding between the employer and employees in
order to formulate a good labor relationship.

37 38

Dialogue at the workplace and

collective labor bargaining 4. Collective Labor Agreement
The Labor Code also grants the right for the employer and  Trade Union
employees to request collective negotiation. Collective
 Dialogue at the workplace and
negotiation may concern any of the following:
collective labor bargaining
• Salary, bonuses, allowances and pay rise;
 Collective Labor Agreement
• Working hours, rest time, overtime working hours,
breaks between shifts;
• Assurance in connection with the employees’ jobs;
• Assurance of labor safety, occupational health and
compliance with the ILRs; and
• Other matters.
39 40

Collective Labor Agreement Chapter 7. Labor Law

A CLA is a written agreement between the employees as 1. Employment Relationship
one party and the employer as the other party in respect 2. Individual Labour Contract
to the matters relevant to the labor relationship.
3. Labour Outsourcing
Representatives of the employees and the employer
negotiate and sign a CLA based on principles of voluntary 4. Collective Labor Agreement
commitment and fairness. The representative of the 5. Working Conditions, Salary and Hours
employees, under the Labor Code, is the chairman of the
6. Discipline and Material Liabilities
internal trade union.
7. Social Insurance
8. Labour Disputes and Strike

41 42

7
 5. Working Conditions, Salary Labor safety and hygiene
and Hours The Ministry of Labor, Invalids and Social Affairs (MOLISA)
 Labor safety and hygiene is responsible to draft and prepare the national standards
on labor safety and hygiene. The employer is responsible
 Injury Compensation to prepare its regulations and working procedures in order
 Salary to ensure labor safety and hygiene in accordance with
 Working hours and rest time national and regional standards.

43 44

Injury Compensation
5. Working Conditions, Salary Vietnamese law requires an employer to compensate any employee
who is injured in a labor accident or who suffers from an
and Hours occupational disease. In general, the employer must pay the share
of expenses payable by the insurer and the expenses not included in
 Labor safety and hygiene the list of expenses payable by medical insurance in the case of an
 Injury Compensation employee covered by medical insurance, and all medical expenses
incurred from the time of first aid or emergency treatment up until
 Salary treatment has stabilized in the case of an test employees’ interests
 Working hours and rest time must be carried out in the above order.
The law also prevents the employers from unilaterally terminating
the labor contract of an injured employee during the period of
medical treatment, unless the employee remains unable to work
after having received treatment for a certain period of time.

45 46

Injury Compensation
5. Working Conditions, Salary
The salary level used for calculating compensation is the employee’s
average salary for the 6 months immediately prior to the accident, and Hours
plus allowances. If the employee has been employed for less than 6
months, the salary level used for the calculation is the monthly  Labor safety and hygiene
salary at the time of the accident.
 Injury Compensation
If the employer recruits a trainee or an apprentice and a labor
accident/occupational disease occurs, the employer must  Salary
compensate the trainee or apprentice. The salary level for  Working hours and rest time
calculating compensation is the minimum salary in the company at
the time the accident occurs or the trainee/apprentice’s actual
salary, whichever is higher.

47 48

8
 Salary
Salary is a money amount which is paid by the employer to the
employee as agreed upon for the latter to do a certain job,
including job- or title-based wage amount, wage-based
allowance, and other additional amounts (Article 90.1 of the
Labor Code). The salary may include salary for work or position
plus allowances and other additional items.
An employee’s remuneration for performing his/her work is
usually set out in individual labor contract and CLA. Salary may
not lower than the minimum salary stipulated by the
Government.
49
Salary
• The employee who performs overtime work shall be paid
based on the wage unit or wage actually paid for his/her
current job, specifically as follows:
a/ At least equal to 150%, on normal workdays;
b/ At least equal to 200%, on weekends;
c/ At least equal to 300%, on public holidays and paid leave
days, excluding the wage for public holidays and paid leave
days for employees who receive daily wages.
(Article 98 of the Labor Code)
51
5. Working Conditions, Salary
and Hours
 Labor safety and hygiene
 Injury Compensation
 Salary
 Working hours and rest time
53
Salary
• The employer shall pay wages directly, fully and timely to
employees. In case the employee cannot receive wage
directly, a person lawfully authorized by the employee may
receive wage.
• The employer may not restrict or intervene into the
employees’ right to self-decide on use of their wages; and
may not compel employees to spend their wages on
purchasing goods or using services of the employer or
another unit designated by the employer.
(Article 94 of the Labor Code)
50
Salary
• The employee who performs night work shall be paid with
an additional amount at least equal to 30% of the wage
calculated based on the wage unit or wage actually paid for
a job performed during normal workdays.
• The employee who performs overtime work at night shall, in
addition to the payments specified in Clauses 1 and 2 of this
Article, be paid with an additional amount equal to 20% of
the wage calculated based on the wage unit or wage for a
job performed during daytime of normal workdays or of
weekends or public holidays.
(Article 98 of the Labor Code)
52
Working hours and rest time
 Working hours
 Rest time
54
9
 Working hours Working hours
According to Article 105 of the Labor Code, Normal working
time must not exceed 8 hours per day and 48 hours per week.
According to Article 107 of the Labor Code, overtime
The employer may determine the working time on a daily or period is a working period in addition to normal working
weekly basis but shall notify such to employees; in case of
time prescribed by law, collective labor agreements or
application of working time on a weekly basis, the normal
working time must not exceed 10 hours per day and 48 hours
internal working regulations.
per week.
The State shall encourage employers to apply 40 working hours
per week.
Employers shall ensure restrictions on the length of time
during which employees work in contact with hazardous or
dangerous elements according to relevant national technical
regulations and laws.
55 56

Working hours Working hours

The employer may request the employee to work overtime
when fully satisfying the following requirements:
a/ Obtaining the employee’s consent;
b/ Ensuring that overtime working hours of the employee
does not exceed 50% of the normal working hours per day; in
case of application of normal working time on a weekly basis,
the total of normal working hours and overtime working
hours must not exceed 12 hours per day and 40 hours per
month;
c/ Ensuring that overtime working hours of the employee do
not exceed 200 hours per year, except the cases specified in
Clause 3 of this Article.
57
The employer may request the employee to work overtime for
no more than 300 hours per year in the following cases:
a/ Production and export processing of textiles, garments
and footwear products; production of electrical and
electronic products, processing of agricultural and forest
products, salt making, and fisheries;
b/ Electricity production and supply, telecommunications,
and oil refining; water supply and drainage;
c/ Jobs requiring laborers with high professional and
technical qualifications when the labor market cannot fully
and timely supply;
58

Working hours
The employer may request the employee to work overtime for
Working hours and rest time
no more than 300 hours per year in the following cases:
 Working hours
d/ Settlement of urgent issues which cannot be delayed due
to the seasonal nature of materials or products or settlement  Rest time
of issues arising due to unforeseeable objective factors or
consequences of bad weather, natural disaster, fire, enemy
sabotage, electricity or material shortage, or technical
incidents of production lines;
dd/ Other cases as prescribed by the Government.
4. When organizing overtime work under Clause 3 of this
Article, the employer shall send a written notice to the
specialized agency in charge of labor affairs under the
provincial-level People’s Committee. 59 60

10
 Rest time
An employee is entitled to have a break-time during his/her
normal working time and weekly day off.
Under Article 109 of the Labor Code, an employee regulated
by the working time prescribed in Article 105 of this Code who
works for 6 or more hours in a day is entitled to a break of at
least 30 consecutive minutes in the middle of working time, or
a break of at least 45 consecutive minutes if they work at
night.
For an employee regulated by shift-based working time who
works for 6 or more consecutive hours, the period of break in
the middle of working time shall be included in working hours .
61
Rest time
• According to Article 111 of the Labor Code, every week, an
employee is entitled to a break of at least 24 consecutive
hours. In special cases in which it is impossible for an
employee to have a weekly break due to the cycle of work,
the employer shall ensure that such employee has at least 4
days off on average in a month.
• An employer may decide to schedule weekly breaks either
on Sunday or another fixed weekday and shall include them
in internal working regulations.
• If a weekly day-off falls on a public holiday prescribed in
Clause 1, Article 112 of the Labor Code, employees are
entitled to take another day-off on the next working day.
62

Rest time Rest time

Under Article 113 of the Labor Code, The employee who has
been working for the employer for full 12 months is entitled to An employee is entitled to have fully paid days off on at 11
a fully paid annual leave as stated in his/her labor contract, public holidays and New Year (Article 112 of the Labor
which is prescribed as follows: Code). In addition, he/she can enjoy several types of fully
a/ Twelve working days, for employees working in normal paid personal leave.
conditions;
b/ Fourteen working days, for juvenile employees, employees
being persons with disabilities, or persons doing heavy,
hazardous or dangerous jobs;
c/ Sixteen working days, for persons doing extremely heavy,
hazardous or dangerous jobs.

63 64

Rest time Chapter 7. Labor Law

Vietnamese Social Insurance Law provides several social 1. Employment Relationship
insurance leave for employees, including sick leave and 2. Individual Labour Contract
maternity leave (Article 26 and 34 of the Law on Social
Insurance 2014). 3. Labour Outsourcing
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike

65 66

11

6. Discipline and Material Liabilities
 Internal Labor Regulations
and Discipline Actions
 Remedies of Employee
67
Remedies of Employee
In addition to authorizing the implementations of
disciplinary action, the Labor Code allows the employer to
claim compensation from an employee who damages or
loses tools, equipment, or other assets of the company.
Likewise, an employee may be required to compensate
the employer if he uses work-related material at an
excessive rate. The compensate, depending on each case,
is equal to the whole or a part of the value of the assets at
market price, and compensation is subject to the
limitations as provided in Article 129 of the Labor Code.
69
7. Social Insurance
 Compulsory Social Insurance
 Voluntary Social Insurance
 Health Insurance
 Unemployment Insurance
71
Internal Labor Regulations and
Discipline Actions
In order to have solid grounds to take disciplinary action against an
employee, the employer must have ILRs, which are carefully-worded
company labor rules duly registered with the Department of Labor,
Invalids and Social Affairs at provincial level (DOLISA).
An employee who breaches ILRs, depending on the seriousness of
the breach, may be disciplined in one of the following ways:
• Reprimand;
• Deferral of wage increase for a maximum 6 months or demotion;
• Dismissal, only applied in the circumstances as provided in Article
125 of the Labor Code.
68
Chapter 7. Labor Law
1. Employment Relationship
2. Individual Labour Contract
3. Labour Outsourcing
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike
70
Compulsory Social Insurance
Compulsory social insurance applied to Vietnamese employees
who work pursuant to labor contract of a term of three
months or more (Article 2.1 of the Law on Social Insurance).
The compulsory social insurance provide 5 main benefits
(Article 4.1 of the Law on Social Insurance):
• Sickness;
• Maternity;
• Labor accident and occupational disease;
• Pension; and
• Survivorship benefits.
72
12
 Voluntary Social Insurance
Voluntary social insurance applied to Vietnamese citizens aged
full 15 years or older and not defined in compulsory social
insurance (Article 2.4 of the Law on Social Insurance).
The compulsory social insurance provide 2 main benefits
(Article 4.2 of the Law on Social Insurance):
• Pension; and
• Survivorship benefits.
73
Health Insurance
Under Article 12 of the Law on Health Insurance 2014, health
insurance applied to employers and employees, including:
• Employees on indefinite or at least full three-month
contracts; salaried business managers; officials and civil
servants.
• Part-time officers in communes, wards and towns under the
regulations of the law.
According to Article 21.1 of the Law on Health Insurance 2008,
amended and supplemented in 2014, the health insurance
provide the main benefit of costs of medical examination and
treatment, function rehabilitation, regular pregnancy check-
ups and birth giving.
74

Unemployment Insurance Unemployment Insurance

Unemployment insurance means a scheme aiming to compensate
part of income of a worker when he/she becomes unemployed,
support him/her to receive vocational training, maintain
employment, or seek employment, on the basis of making
contributions to the Unemployment Insurance Fund (Article 3.3 of
the Law on Employment 2013).
The unemployment insurance provide 4 main benefits (Article 42 of
the Law on Employment 2013):
• Unemployment allowance;
• Job counseling and recommendation support;
• Vocational training support; and
• Support for training and retraining to improve qualifications of
occupational skills for job maintenance for workers.
75
Under Article 43 of the Law on Employment 2013, unemployment
insurance applied to employees who work pursuant to labor
contract or working contract of indefinite term, or definite term or
seasonal or job-based working contracts with a term of between full
3 months and under 12 months.
In case an employee has signed and is performing more than one
labor contract specified, the employee and the employer under the
labor contract signed first shall participate in unemployment
insurance.
Employees who are currently on pension or doing housework are
not required to participate in unemployment insurance.
76

Chapter 7. Labor Law

1. Employment Relationship 8. Labor Disputes and Strike
2. Individual Labour Contract
 Labor Disputes
3. Labour Outsourcing
 Strike
4. Collective Labor Agreement
5. Working Conditions, Salary and Hours
6. Discipline and Material Liabilities
7. Social Insurance
8. Labour Disputes and Strike

77 78

13
 Labor Disputes
Labor disputes means a dispute or disagreement about rights,
obligations, and benefits arising between parties in a labor
relationship.
Labor disputes may be individual labor disputes, which are disputes
between an individual employee and his employer, or they may be
collective labor disputes. There are two forms of collective labor
dispute:
 A collective labor dispute involving employees’ rights, which is a
dispute between a group of employees and their employer
regarding the implementation of labor laws, the CLA, and ILRs
which have been registered with the labor authorities; and
 A collective labor dispute involving employees’ interest.
This latter form usually involves a dispute between a group of
employees and their employer in which the employees request
that the employer give them new, better labor conditions that
relate to salary, bonus, working time, or other benefits.
79
Labor Disputes
Under Article 188.1 of the Labor Code, individual labor disputes
must be settled through the conciliation procedures conducted by
labor conciliators before being brought to labor arbitration councils
or courts for settlement, except the following labor disputes which
are not required to go through conciliation procedures:
d/ Disputes over social insurance in accordance with the law on
social insurance, over health insurance in accordance with the law
on health insurance, over unemployment insurance in accordance
with the law on employment, or over occupational accident and
disease insurance in accordance with the law on occupational safety
and health;
dd/ Disputes over compensation between employees and
enterprises or organizations sending employees abroad as guest
workers;
e/ Disputes between leased employees and hiring employers. 81
8. Labor Disputes and Strike
 Labor Disputes
 Strike
83
Labor Disputes
Under Article 188.1 of the Labor Code, individual labor
disputes must be settled through the conciliation procedures
conducted by labor conciliators before being brought to labor
arbitration councils or courts for settlement, except the
following labor disputes which are not required to go through
conciliation procedures:
a/ Disputes over the application of the disciplinary measures of
dismissal or unilateral termination of labor contract;
b/ Disputes over compensation or allowances upon
termination of labor contracts;
c/ Disputes between domestic workers and their employers;
80
Labor Disputes
According Article 195 of the Labor Code, Organizations and
persons competent to settle interest-based collective labor
disputes include:
a/ Labor conciliators;
b/ Labor arbitration councils.
An interest-based collective labor dispute must be settled
through procedures for conciliation by labor conciliators before
being brought to a labor arbitration council for settlement or
before carrying out procedures for a strike.
82
Strike
According Article 198 of the Labor Code, strike is a
temporary, voluntary and organized work stoppage of
employees in order to achieve their demands in the
process of labor dispute settlement, which is organized
and led by the employees’ representative organization
being a collective labor disputing party with the right to
collective bargaining.
84
14

Strike
Under Article 199 of the Labor Code, The employees’
representative organization being a party to an interest-based
collective labor dispute may carry out the procedures
prescribed in Articles 200, 201, 202 of this Code for a strike in
the following cases:
1. Conciliation is unsuccessful or the conciliation duration
prescribed in Clause 2, Article 188 of this Code expires but the
labor conciliator fails to conduct the conciliation;
2. A labor arbitration board is not established or is established
but fails to make a decision on dispute settlement or the
employer being a disputing party fails to implement a dispute
settlement decision of the labor arbitration board.
85
Strike
According Article 204 of the Labor Code, a strike is illegal if:
1. It does not fall into cases where employees may go on strike
specified in Article 199 of this Code.
2. It is neither organized nor led by the employees’ representative
organization with the right to organize and lead strikes.
3. It violates regulations on the order and procedures for carrying
out a strike prescribed in this Code.
4. It occurs when a labor collective dispute is being settled by a
competent agency, organization or person in accordance with this
Code.
5. It falls into cases in which strikes are prohibited specified in
Article 209 of this Code.
6. It occurs when a competent agency issues a decision to postpone
or stop the strike under Article 210 of this Code. 86

Strike
The Labor Code also provides a new right of “quasi-lockout” to
the employer in the Article 205.
At least 3 working days before a workplace is temporarily
closed down, the employer shall publicly post up a decision on
temporary closedown at the workplace and notify it to the
following agencies and organizations:
1. The employees’ representative organization that organizes
and leads the strike;
2. The provincial-level People’s Committee of the locality
where the to-be-closed workplace is located;
3. The district-level People’s Committee of the locality where
the to-be-closed workplace is located.
87

15
 Content Chapter 8. Intellectual Property Law
In addition to Law on Intellectual Property, Vietnam is also a State
Chapter 1. Introduction to Law Party to the Paris Convention, the Madrid Agreement, Madrid
Chapter 2. Civil Law Protocol, and the Stockholm Convention of 1967 (which established
the World Intellectual Property Organization).
Chapter 3. Contract Law Vietnam is also a member of the Agreement on Trade-Related
Aspects of Intellectual Property Rights (TRIPs Agreement), the
Chapter 4. Law on Business Organizations Berne Convention for the Protection of Literary and Artistic Works
with effect from 26 October 2004, the Geneva Convention for the
Chapter 5. Commercial Law Protection of Producers of Phonograms against Unauthorised
Chapter 6. Business-related Dispute Resolutions Duplication of their Phonograms with effect from 06 July 2005, the
Brussels Convention Relating to the Distribution of Programme-
Chapter 7. Labor Law Carrying Signals Transmitted by Satellite with effect from 12 January
2006, the International Convention for the Protection of New
Chapter 8. Intellectual Property Law Varieties of Plant with effect from 24 December 2006, and the
Rome Convention for the Protection of Performers, Producers of
Chapter 9. International Law Phonograms and Broadcasting Organizations with effect from 01
March 2007.
1 2

Trademarks
 Marks used to distinguish goods or services of one person
Chapter 8. Intellectual Property Law from similar goods and services of another person. They
may take the form of words, images, or any combination
 Trademarks presented in one or more colors.
 Patents  Trademarks are generally protected by registration but
certain marks, including logos, cannot be registered if they
 Industrial designs
are:
 Copyright • not distinctive;
• widely used;
• descriptive of the goods or services in question; or
• misleading, deceptive, or identical to or confusingly
similar to existing registrations.
3 4

Trademarks Trademarks
 Priority rights
 Registration procedure
Vietnam adopts a first-to-file rather than a first-to-use priority
system, so that an earlier application for a trademark Vietnam has adopted the classification of goods and
establishes a right of first priority. The date of priority is services as specified in the Nice Agreement for the
generally the date of application, but this can be earlier if a
qualifying application has been made in another member purposes of trademark registration although Vietnam
country of the international trademark treaties. is not a member of the Nice Agreement. A preliminary
Trademarks that have been internationally registered in trademark search can be conducted by the applicant
accordance with an international treaty can also be established to establish whether the mark or any similar mark has
in Vietnam once accepted for protection by the trademark
office. Applicants who wish to rely on international treaties in
already been registered before applying for a
establishing a right of priority must make an express statement trademark in Vietnam.
to that effect in their application for protection and present
evidence in support of their claim of priority.

5 6

1
 Trademarks
 “Well-known” trademarks
Trademarks may still be protected in Vietnam in the absence of Chapter 8. Intellectual Property Law
first-to-file priority. "Well-known" trademarks in Vietnam are
protected in perpetuity. A trademark will be deemed well-
known if it has wide public recognition as evaluated on the  Trademarks
following criteria:
 Patents
• number of customers;
• location for sales;  Industrial designs
• les turnover;
 Copyright
• the number of years in continuous use;
• reputation of goods or services bearing the mark;
• the number of countries where the trademark has been
protected or recognized as well-known; and
• costs for an assignment or licensing of the mark, or
investment capital contribution value of the mark.
7 8

Patents
 Invention and utility solution
An invention is defined as a technical solution which is new in
comparison to existing technology, which is of a creative
character, and is applicable to various social and economic fields.
The following are excluded from patent protection: scientific
discoveries, theories, or mathematical methods; schemes, plans,
rules and methods for performing mental acts; methods of
training domestic animals, playing games, and doing business;
computer programs; the presentation of information; solutions
of aesthetic characteristics only; plant varieties or animal breeds;
processes of plant or animal production which are principally of
a biological nature, other than microbiological processes; and
human and animal disease prevention methods, diagnostic and
treatment methods.
An applicant unable to secure protection as an invention patent
may qualify for protection as a utility solution patent (which is
essentially an invention without involving an inventive step).
9 10
Patents
 Priority rights
The priority of applications for patent protection is
determined by either the date on which NOIP receives
the application or in accordance with the applicable
international treaties. Applicants relying on
international treaties to establish a right of priority
shall make an express statement to that effect in their
application and present evidence in support of their
claim of priority.
Vietnam is a State Party to the Patent Cooperation
Treaty (“PCT”). State Parties to the PCT have agreed to
permit an applicant to wait for up to 30 months after
the initial filing of a patent application in one country
to begin prosecuting the application in other countries.
Vietnamese law extends this period to 31 months.

Patents
 Registration procedure
Patent applications can be made either for international
registration under the PCT procedure or directly in
Chapter 8. Intellectual Property Law
Vietnam.
Applying for patent protection directly in Vietnam will only  Trademarks
be possible if the invention or utility solution has not been
made public anywhere in the world by being used or  Patents
described in a written publication before the filing date or  Industrial designs
priority date, as applicable. A patent application must be
submitted to NOIP.  Copyright
NOIP publishes the application in the industrial property
gazette after preliminary examination and acceptance of
the application. A substantive examination will only be
carried out upon request by the applicant or a third party. A
substantive examination determines the patentability of
the invention or utility solution and its scope of protection.
11 12

2
 Industrial designs
Industrial design means the outward appearance of a product
embodied in three dimensional configuration, lines, colours or
a combination of such elements.
An industrial design is evaluated for worldwide novelty in the
same way as an invention which requires a substantial
distinction and uniqueness when evaluated by a person having
ordinary skill in the relevant area. Excluded from the
protection of industrial designs are mere functional or
technical features of a product’s appearance, external features
of civil or industrial construction works, and the shape of a
product which is invisible during the use of the product.
A technical design should not be disclosed in any form or in
any jurisdiction until the date of filing for protection. This is to
maintain its worldwide novelty.
13
Chapter 8. Intellectual Property Law
 Trademarks
 Patents
 Industrial designs
 Copyright
15
Copyright
 Owners and authors of copyright
Rights over a work include personal rights (including the
right to name a work and to permit others to use the
work) and property rights (including the right to receive
royalties and to rent out the work). These rights are
divided into three types: (i) rights of an author; (ii) rights
of an owner; and (iii) rights of an author who is
concurrently the owner of a work and therefore holds
full personal and property rights over a work.
17
Industrial designs
Priority rights over protection of industrial designs are
achieved by the same way as for trademarks and patents.
Since international applications are not available for
protection of industrial designs, applicants need to
register in Vietnam through NOIP.
14
Copyright
 Owners and authors of copyright
There is a distinction between owners and authors of works.
An author is a person who creates all or part of a literary,
artistic or scientific work. Those who translate, adapt or edit
works are deemed to be the authors of their derivative
work.
Owners of works may be authors or co-authors, authorities
or organizations which delegate a duty to an author to
create a work, individuals or organizations which contract
with an author for the creation of a work, heirs who inherit
a work from an author who was also the owner of a work,
and individuals and organizations to which ownership rights
over a work are transferred by contract.
16
Copyright
 Establishment of copyright
Copyright arises from the moment a work is created in a
definite form. The law provides that copyright protection in
respect of foreign individuals and entities will be limited to
works which are first published or disseminated in Vietnam,
or which are created and take a definite form in Vietnam.
Works of foreign authors not first published in Vietnam must
be published in Vietnam within thirty days of first
publication. Vietnam has acceded to the Berne Convention
for the Protection of Literary and Artistic Works that
provides the protection of Vietnamese copyright law to
qualifying works under the Berne Convention.
18
3
 Copyright
 Registration of copyright
Authors, co-authors and owners of works have the right to apply
for the registration and protection of copyright and ownership of
such works to the Copyright Department under the Ministry of
Culture, Sports and Tourism.
The application must be supported by evidence of the applicant’s
authorship and/or ownership of the work. Where the application
is in order, the applicant will be issued with a Copyright
Certificate within 15 working days from the receipt of the
application.
The Ministry of Culture, Sports and Tourism has primary
responsibility for the protection of copyright in Vietnam and is
assisted at the local level by a network of Culture, Sports and
Tourism Inspectors.
19

4
 Content
Chapter 1. Introduction to Law
Chapter 2. Civil Law
Chapter 3. Contract Law
Chapter 4. Law on Business Organizations
Chapter 5. Commercial Law
Chapter 6. Business-related Dispute Resolutions
Chapter 7. Labor Law
Chapter 8. Intellectual Property Law
Chapter 9. International Trade Law
1 2
Introduction to public and private
International Law
Public international law is traditionally defined as the law
between sovereign nation-states, states, especially within the
context of law of war, peace and security, and protection of
territories.
While these concern of international law remain paramount
among states today, the classic definition of public
international law has expended to include a more diverse
group of subjects and a broader scope of activities.
In addition to states as subjects of international law, other
participants engaged in international law activities and its
development include private entities, and international
organizations.
3 4
Chapter 9. International Trade Law
 Introduction to public and private international law
 WTO
 Vienna convention on International Sale of Goods
 Incoterms 2020
5 6
Chapter 9. International Trade Law
 Introduction to public and private international law
 WTO
 Vienna convention on International Sale of Goods
 Incoterms 2020
Introduction to public and private
International Law
The private international law is that part of the law of
every State which deals with cases having a foreign
element.
Two elements are fundamental in order to determine a
private international social relation:
- Internationality
- Horizontal relations
Private law is concerned with all legal relationships
between private entities and thus includes, for example,
family law and the law of contracts and obligations. These
laws differ from country to country.
WTO
The World Trade Organization (WTO) is an intergovernmental
organization which regulates international trade.
The WTO officially commenced on 1 January 1995 under
the Marrakesh Agreement, signed by 123 nations on 15 April
1994, replacing the General Agreement on Tariffs and Trade
(GATT), which commenced in 1948.
The WTO deals with regulation of trade between participating
countries by providing a framework for negotiating trade
agreements and a dispute resolution process aimed at
enforcing participants' adherence to WTO agreements, which
are signed by representatives of member governments and
ratified by their parliaments.
1
 WTO
 Functions
 Principles of the trading system
7 8
Functions
Additionally, it is the WTO's duty to review and propagate
the national trade policies, and to ensure the coherence
and transparency of trade policies through surveillance in
global economic policy-making. Another priority of the
WTO is the assistance of developing, least-developed and
low-income countries in transition to adjust to WTO rules
and disciplines through technical cooperation and
training.
9 10
Functions
The above five listings are the additional functions of the
World Trade Organization. As globalization proceeds in
today's society, the necessity of an International
Organization to manage the trading systems has been of
vital importance. As the trade volume increases, issues
such as protectionism, trade barriers, subsidies, violation
of intellectual property arise due to the differences in the
trading rules of every nation. The World Trade
Organization serves as the mediator between the nations
when such problems arise. WTO could be referred to as
the product of globalization and also as one of the most
important organizations in today's globalized society.
11
Functions
Among the various functions of the WTO, these are
regarded by analysts as the most important:
• It oversees the implementation, administration and
operation of the covered agreements.
• It provides a forum for negotiations and for settling
disputes.
Functions
 The WTO shall facilitate the implementation, administration and
operation and further the objectives of this Agreement and of
the Multilateral Trade Agreements, and shall also provide the
frame work for the implementation, administration and
operation of the multilateral Trade Agreements.
 The WTO shall provide the forum for negotiations among its
members concerning their multilateral trade relations in matters
dealt with under the Agreement in the Annexes to this
Agreement.
 The WTO shall administer the Understanding on Rules and
Procedures Governing the Settlement of Disputes.
 The WTO shall administer Trade Policy Review Mechanism.
 With a view to achieving greater coherence in global economic
policy making, the WTO shall cooperate, as appropriate, with the
International Monetary Fund (IMF) and with the International
Bank for Reconstruction and Development (IBRD) and its
affiliated agencies.
Functions
The WTO is also a centre of economic research and
analysis: regular assessments of the global trade picture
in its annual publications and research reports on specific
topics are produced by the organization. Finally, the WTO
cooperates closely with the two other components of the
Bretton Woods system, the IMF and the World Bank.
12
2
 WTO
 Functions
 Principles of the trading system
13
Principles of the trading system
 Non-discrimination
It has two major components: the most favored nation (MFN) rule,
and the national treatment policy (NT). Both are embedded in the
main WTO rules on goods, services, and intellectual property, but
their precise scope and nature differ across these areas.
• The MFN rule requires that a WTO member must apply the
same conditions on all trade with other WTO members, i.e. a
WTO member has to grant the most favorable conditions under
which it allows trade in a certain product type to all other WTO
members. "Grant someone a special favor and you have to do
the same for all other WTO members."
• National treatment (NT) means that imported goods should be
treated no less favorably than domestically produced goods (at
least after the foreign goods have entered the market) and was
introduced to tackle non-tariff barriers to trade (e.g. technical
standards, security standards et al. discriminating against
imported goods).
15
Principles of the trading system
 Transparency
The WTO members are required to publish their trade
regulations, to maintain institutions allowing for the review of
administrative decisions affecting trade, to respond to requests
for information by other members, and to notify changes in
trade policies to the WTO. These internal transparency
requirements are supplemented and facilitated by periodic
country-specific reports (trade policy reviews) through the Trade
Policy Review Mechanism (TPRM). The WTO system tries also to
improve predictability and stability, discouraging the use of
quotas and other measures used to set limits on quantities of
imports.
 Safety valves
In specific circumstances, governments are able to restrict trade.
The WTO's agreements permit members to take measures to
protect not only the environment but also public health, animal
health and plant health.
17
Principles of the trading system
The WTO establishes a framework for trade policies; it
does not define or specify outcomes. That is, it is
concerned with setting the rules of the trade policy
games. Five principles are of particular importance in
understanding both the pre-1994 GATT and the WTO.
14
Principles of the trading system
 Reciprocity
It reflects both a desire to limit the scope of free-riding that may
arise because of the MFN rule, and a desire to obtain better
access to foreign markets. A related point is that for a nation to
negotiate, it is necessary that the gain from doing so be greater
than the gain available from unilateral liberalization; reciprocal
concessions intend to ensure that such gains will materialize.
 Binding and enforceable commitments.
The tariff commitments made by WTO members in a multilateral
trade negotiation and on accession are enumerated in a
schedule (list) of concessions. These schedules establish "ceiling
bindings": a country can change its bindings, but only after
negotiating with its trading partners, which could mean
compensating them for loss of trade. If satisfaction is not
obtained, the complaining country may invoke the WTO dispute
settlement procedures.
16
Chapter 9. International Trade Law
 Introduction to public and private international law
 WTO
 Vienne convention on International Sale of Goods
 Incoterms 2020
18
3
 Vienna convention on International
Sale of Goods
The United Nations Convention on Contracts for the International
Sale of Goods (CISG; the Vienna Convention) is a treaty that is a
uniform international sales law. As of May 2016, it has
been ratified by 85 states that account for a significant proportion
of world trade, making it one of the most successful international
uniform laws.
The CISG was developed by the United Nations Commission on
International Trade Law (UNCITRAL), and was signed in Vienna in
1980. The CISG is sometimes referred to as the Vienna
Convention (but is not to be confused with other treaties signed in
Vienna such as Vienna Convention on Diplomatic Relations, Vienna
Convention on the Law of Treaties…). It came into force as a
multilateral treaty on 1 January 1988, after being ratified by 11
countries.
19
Vienna convention on International
Sale of Goods
The CISG has been regarded as a success for the UNCITRAL, as the
Convention has been accepted by states from "every geographical
region, every stage of economic development and every major
legal, social and economic system". Countries that have ratified the
CISG are referred to within the treaty as “Contracting States”.
Of the uniform law conventions, the CISG has been described as
having "the greatest influence on the law of worldwide trans-
border commerce“. It has been described as a great legislative
achievement, and the "most successful international document so
far" in unified international sales law, in part due to its flexibility in
allowing Contracting States the option of taking exception to
certain specified articles. This flexibility was instrumental in
convincing states with disparate legal traditions to subscribe to an
otherwise uniform code.
21
Incoterms 2020
The Incoterms rules or International Commercial Terms are a series
of pre-defined commercial terms published by the International
Chamber of Commerce (ICC) relating to international commercial
law. They are widely used in International commercial transactions
or procurement processes as the use in international sales is
encouraged by trade councils, courts and international lawyers. A
series of three-letter trade terms related to common contractual
sales practices, the Incoterms rules are intended primarily to clearly
communicate the tasks, costs, and risks associated with the
transportation and delivery of goods. Incoterms inform sales
contract defining respective obligations, costs, and risks involved in
the delivery of goods from the seller to the buyer. However, it does
not constitute contract or govern law. Also it does not define where
titles transfer and does not address the price payable, currency or
credit items.
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Vienna convention on International
Sale of Goods
The CISG allows exporters to avoid choice of law issues, as
the CISG offers "accepted substantive rules on which
contracting parties, courts, and arbitrators may
rely”. Unless excluded by the express term of a contract,
the CISG is deemed to be incorporated into (and
supplant) any otherwise applicable domestic law(s) with
respect to a transaction in goods between parties from
different Contracting States.
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Chapter 9. International Trade Law
 Introduction to public and private international law
 WTO
 Vienna convention on International Sale of Goods
 Incoterms 2020
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Incoterms 2020
The Incoterms rules are accepted by governments, legal
authorities, and practitioners worldwide for the interpretation of
most commonly used terms in international trade. They are
intended to reduce or remove altogether uncertainties arising
from different interpretation of the rules in different countries.
As such they are regularly incorporated into sales contracts
worldwide.
The first work published by the ICC on international trade terms
was issued in 1923, with the first edition known as Incoterms
published in 1936. The Incoterms rules were amended in 1953,
1967, 1976, 1980, 1990, and 2000, with the eighth version —
Incoterms 2010 – having been published on January 1, 2011. The
ICC have begun consultations on a new revision of Incoterms, to
be called Incoterms 2020."Incoterms" is a registered trademark
of the ICC. 24
4
 Incoterms 2020
• Incoterms are not law and there is NO default Incoterm.
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Incoterms 2020
 Rules for sea and inland waterway transport
• FAS - Free Alongside Ship: Giao dọc mạn tàu
• FOB - Free On Board: Giao lên tàu
• CFR - Cost and Freight: Tiền hàng và cước phí
• CIF - Cost, Insurance and Freight: Tiền hàng, bảo hiểm
và cước phí
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Incoterms: Seller/Buyer Risks, Costs and Obligations Transfer
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Incoterms 2020
 Rules for any mode of transport
• EXW - Ex Works: Giao tại xưởng
• FCA - Free Carrier: Giao cho người chuyên chở
• CPT - Carriage Paid To: Cước phí trả tới
• CIP - Carriage and Insurance Paid To: Cước phí và bảo
hiểm trả tới
• DAT - Delivered at Terminal: Giao tại bến
• DAP - Delivered at Place: Giao tại nơi đến
• DDP - Delivered Duty Paid: Giao hàng đã nộp thuế
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Incoterms 2020
 Incoterms do not...
• Determine ownership or transfer title to the goods, nor
evoke payment terms.
• Apply to service contracts, nor define contractual rights
or obligations (except for delivery) or breach of contract
remedies.
• Protect parties from their own risk or loss, nor cover the
goods before or after delivery.
• Specify details of the transfer, transport, and delivery of
the goods. Container loading is NOT considered
packaging and must be addressed in the sales contract.
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