Arbitration procedures and practice in Vietnam: Overview

A Q&A guide to arbitration law and practice in Vietnam.

The country-specific Q&A guide provides a structured overview of the key practical issues concerning arbitration in this jurisdiction, including any mandatory provisions and default rules applicable under local law, confidentiality, local courts’ willingness to assist arbitration, enforcement of awards and the available remedies, both final and interim.

To compare answers across multiple jurisdictions visit the Arbitration procedures and practice Country Q&A Tool.

This Q&A is part of the global guide to arbitration. For a full list of jurisdictional Q&As visit

Le Net, LNT & Partners

Use of arbitration and recent trends

1. How is commercial arbitration used in your jurisdiction and what are the recent trends?

Use of commercial arbitration

In recent years arbitration in Vietnam has gained momentum and is becoming an increasingly attractive method of resolving domestic and international disputes. Parties tend to prefer the private nature of the proceedings and the ability to decide on important issues, including the arbitrators, choice of law, venue and language. Relevant statistics for 2013 revealed that 4% of all disputes In Vietnam were resolved by arbitration.

An overwhelming majority of the cases involve the sale of goods (60%), relying on data from the largest and most commonly used local arbitration administrator in Vietnam, the Vietnam International Arbitration Centre (VIAC). However, a growing number of claims relate to other economic sectors such as banking and finance, construction, distribution, investments, outsourcing and services.

Recent trends

Foreign companies have used arbitration for quite some time, but recent statistics show that local companies are increasingly relying on arbitration as the preferred choice for dispute resolution. A leading indicator is the 55% increase year-on-year in cases settled by VIAC in 2013. The VIAC handled 99 cases in 2013 and 124 cases in 2014 (an increase of 25%). The majority of cases are settled in Ho Chi Minh City. Domestic arbitrations count for 58.9% while international arbitrations count for 41.1%. On average, an arbitration lasts for 167 days, with the shortest case taking 81 days and the longest case extending 251 days. Out of 124 cases, the following statistics demonstrate that the VIAC arbitration is now becoming increasingly recognised internationally:

  • Cases that apply applicable foreign laws: four.

  • Cases that apply foreign languages: 25.

  • Cases where arbitrators send dissenting or separate opinions: five.

  • Cases that have the involvement of lawyers: 66 out of 124.

  • Cases that request for courts to apply interim measures: 14.

  • Cases that request for the tribunal to apply interim measures: two.

Arbitration clauses are now becoming a necessity in virtually all contracts.

Another positive trend is the increased involvement of local Vietnamese attorneys acting as arbitrators. The valuable experience local attorneys gain from representing clients in arbitral disputes have translated into a larger pool of qualified local attorneys who can credibly act as arbitrators in both complex cross-border and domestic arbitration proceedings. This will help bolster and continue to elevate arbitration as the preferred dispute resolution mechanism in Vietnam.


There are many advantages to using arbitration over court litigation. In addition to the near universal advantages experienced in other jurisdictions (for example, final resolution on the merits, privacy, quicker resolution, and ability to select the language and venue).

One key advantage arbitration offers is the ability for parties to preselect the lex causae (that is, the law governing the merits of the dispute). This is unless the underlying dispute is wholly a domestic affair. In contrast, litigants in Vietnamese courts must exclusively rely on Vietnamese law. Testimony on foreign law in Vietnamese court proceedings is currently not allowed. The ability to choose the substantive law allows the parties to better manage their risks, selecting and applying laws that cover potential issues specific to their commercial relationship.

Another key advantage is the ability to select qualified and impartial arbitrators. Vietnam’s corruption rankings are among the worst in the world and judicial bribery remains a major concern.

Finally, because Vietnam is a signatory to the New York Convention, arbitral awards are recognised and enforceable in more countries, including Vietnam, compared to court judgments, which are recognised on a reciprocal basis making the enforcement of foreign judgments more difficult.

While arbitration offers many benefits, the enforcement of arbitral awards in Vietnam remains challenging. The grounds for setting aside awards can be interpreted broadly when compared to the arbitration enforcement laws and practices of other countries.

Legislative framework

Applicable legislation

2. What legislation applies to arbitration? To what extent has your jurisdiction adopted the UNCITRAL Model Law on International Commercial Arbitration 1985 (UNCITRAL Model Law)?

The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) governs arbitrations conducted in Vietnam. Resolution No. 01/2014/NQ-HDTP (Resolution No.01), issued by the Supreme Court of Vietnam, provides further guidance on the implementation of certain provisions of the LCA.

The LCA refers significantly to the UNCITRAL Model Law and incorporates many important legal concepts, including a:

  • Tribunal’s ability to summon witnesses.

  • Party’s right to request, and a tribunal’s corresponding ability to grant, interim relief.

The Law on Enforcement of Civil Judgments (LECJ) controls the enforcement of arbitral awards and the Civil Procedure Code 2004 (CPC) governs the recognition and enforcement of foreign awards in Vietnam.

Mandatory legislative provisions

3. Are there any mandatory legislative provisions? What is their effect?

Most provisions in the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) are not mandatory. The LCA allows the parties to freely decide many critical issues that govern the arbitral proceedings. However, there are some mandatory legislative requirements, including:

  • The arbitral award is final and binding.

  • The arbitration agreements must be in writing.

  • The subject matter of the arbitration must involve at least one party engaged in commercial activity (commercial is defined as a profit-making activity, for example, the sale of goods, services, investments and trade promotion) and cannot belong in the exclusive jurisdiction of court litigation.

  • Vietnamese laws apply when the underlying dispute does not involve any foreign element.

  • The arbitral tribunal must, as a threshold, decide its jurisdiction by determining the validity and subject matter of an arbitration agreement.

  • Arbitrators must be independent, objective, impartial and observe the law.

The cumulative effect of the mandatory provisions is a strong legal system generally in favour of arbitration. This reduces the “bottleneck” effect caused by threshold issues that typically plague other jurisdictions, that is, the validity and scope of arbitration provisions.


4. Does the law of limitation apply to arbitration proceedings?

The statute of limitations to institute arbitration proceedings is typically two years from the date that a claimant has the right to take legal action. This is with the following two exceptions:

  • The statute of limitations for insurance contracts is three years from when the dispute arises (Article 30, Law on Insurance Business 2000).

  • The statute of limitations for damages with respect to cargo is one year from the date on which the cargo is delivered or should have been delivered to the consignee (Article 97, Vietnam Maritime Code).

The statute of limitations to enforce a foreign arbitral award is one year from the date the award becomes final.

Arbitration organisations

5. Which arbitration organisations are commonly used to resolve large commercial disputes in your jurisdiction?

The Vietnam International Arbitration Centre (VIAC) is the largest arbitration organisation in Vietnam. However, there are a number of arbitration centres, including:

  • The Asean International Commercial Arbitration Centre (ACIAC).

  • The Financial and Commercial Centre for Arbitration (FCCA).

  • The Pacific International Arbitration Centre (PIAC).

See box, Main arbitration organisations.

Arbitration agreements

Validity requirements

6. What are the requirements for an arbitration agreement to be enforceable?

Substantive/formal requirements

The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) only requires that an arbitration agreement be in writing and contain language that establishes the mutual consent of the parties to resolve their dispute by arbitration. The written requirement can be satisfied in different ways and can take various forms, including the following:

  • An agreement made through communications between the parties via telegram, fax, telex, email or other forms prescribed by law.

  • An agreement made through the exchange of written information between the parties.

  • An agreement recorded in writing by a lawyer, notary public, or competent institution at the request of the parties.

  • A document such as a contract, company charter or other similar document, which contains an arbitration agreement, and referenced by the parties during the course of their transaction.

  • An agreement made through an exchange of statements of claims and defences that reflect the existence of an agreement proposed by a party and not denied by the other party.

Separate arbitration agreement

An arbitration agreement can be made in the form of an arbitration clause contained in a contract or in the form of a separate agreement.

Unilateral or optional clauses

7. Are unilateral or optional clauses, where one party has the right to choose arbitration, enforceable?

The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) does not address unilateral or optional clauses. However, in theory if one party confers another party the right to arbitrate this may be sufficient to establish an agreement to arbitration.

In the context of consumer services and goods, arbitration cannot be unilaterally imposed through the provider’s general terms and conditions. Consumers can elect to litigate in court or arbitrate the dispute.


8. Does the applicable law recognise the separability of arbitration agreements?

An arbitration agreement is entirely independent of the contract where it is contained. Any modification, extension, cancellation, invalidation or non-performance of the underlying contract will not invalidate the arbitration agreement.

Breach of an arbitration agreement

9. What remedies are available where a party starts court proceedings in breach of an arbitration agreement or initiates arbitration in breach of a valid jurisdiction clause?

Court proceedings in breach of an arbitration agreement

A court will refuse to accept a case involving a dispute that is subject to a valid arbitration agreement. A party’s participation in a court proceeding does not act as a waiver of the party’s right to arbitrate the matter.

Arbitration in breach of a valid jurisdiction clause

If the parties did not agree to arbitrate, but instead agreed to resolve all disputes in court under a valid jurisdiction clause, the arbitration cannot proceed. If the scope of the jurisdiction clause is limited to certain matters, the parties can theoretically either waive the jurisdiction clause or agree to arbitrate matters not within the scope of the jurisdiction clause.

10. Will the local courts grant an injunction to restrain proceedings started overseas in breach of an arbitration agreement?

There are no regulations that specifically allow a local court to grant an injunction restraining judicial proceedings initiated overseas in breach of a valid arbitration agreement. The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) simply directs a court to refuse to accept cases that are subject to arbitration and allows a court to decide whether a matter is subject to arbitration.

However, the LCA does allow a tribunal the power to prohibit or force a party from taking any action that may adversely affect the arbitral proceedings.

Joinder of third parties

11. In what circumstances can a third party be joined to an arbitration or otherwise be bound by an arbitration award?

The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) does not contain any provision allowing the involuntary joinder of non-signatory third parties to an arbitration proceeding. However, a third party (with the consent of all parties) may theoretically voluntarily join the arbitration as a co-applicant or co-respondent.

A third party may nevertheless be bound by an arbitral award if the party is a party to another contract whose validity or enforceability is dependent on the contract that is subject to arbitration. For example, an award from a loan agreement containing a valid arbitration agreement can affect the guarantor of the loan. Similarly, an agent can theoretically bind the non-signatory principal.


Number and qualifications/characteristics

12. Are there any legal requirements relating to the number and qualifications/characteristics of arbitrators?

An arbitral tribunal can be composed of one or more arbitrators as agreed by the parties.

Under the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) a person who satisfies all the following criteria can act as an arbitrator:

  • Has the legal capacity to act under the Civil Code.

  • Possess a university degree and at least five years’ of work experience in the discipline studied.

  • In special cases, an expert who has highly specialised skills or qualifications can also be selected as arbitrator even if he does not have the requisite education and work experience.

The following cannot act as arbitrators:

  • Incumbent judges, procurators, investigators, enforcement officers or civil servants of the people’s courts, people’s procuracy, investigative agencies or judgment enforcement agencies.

  • Persons serving criminal sentences or whose criminal records have not yet been cleared even though they have served their sentences.


13. Are there any requirements relating to arbitrators’ independence and/or impartiality?

An arbitrator must be independent and impartial, with the ability to quickly and promptly settle disputes.


14. Does the law contain default provisions relating to the appointment and/or removal of arbitrators?

Appointment of arbitrators

Under Article 40 of the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) the parties are free to agree on the procedure for the appointment of the arbitrator(s). In cases where the parties agree that their dispute will be settled by a sole arbitrator, the claimant must state the name and address of the person whom the claimant selects as arbitrator. Unless otherwise agreed by the parties, within 30 days after receiving the claimant’s statement of claims, the parties must agree on the selection of a sole arbitrator or request the Arbitration Centre to appoint a sole arbitrator, within 30 days after receiving the claimant’s statement of claims (unless otherwise agreed by the parties). A competent court can, at the request of any party, designate a sole arbitrator.

Removal of arbitrators

An arbitrator is disqualified and can be removed in the following circumstances (Article 42.1, LCA):

  • The arbitrator is a relative or representative of one party.

  • The arbitrator has an interest related to the dispute.

  • There are clear grounds to conclude that the arbitrator is not impartial or objective.

  • The arbitrator was a conciliator, representative, or lawyer of one party before the dispute was brought to arbitration for settlement (unless the parties consented in writing to waive such a potential conflict).


Commencement of arbitral proceedings

15. Does the law provide default rules governing the commencement of arbitral proceedings?

There are no laws that provide default rules governing the commencement of arbitral proceedings. When a dispute is settled by an arbitration centre, the time of commencement of arbitral proceedings is the time the arbitration centre receives the claimant’s statement of claims (unless otherwise agreed to by the parties)

In contrast, when a dispute is settled by ad hoc arbitration, the time of commencement of arbitral proceedings is the time the defendant receives the claimant’s statement of claims (unless otherwise agreed to by the parties).

Applicable rules

16. What procedural rules are arbitrators likely to follow? Can the parties determine the procedural rules that apply? Does the law provide any default rules governing procedure?

Applicable procedural rules

The parties are free to decide the applicable procedural rules. Arbitrators must respect the agreement of the parties if the procedural rules do not contravene any legal prohibitions or social ethics. If the parties do not specify procedural rules for the arbitrators to follow, arbitrators are likely to resort to the rules of the arbitration centre administering the arbitration.

Default rules

If the parties cannot agree on the governing procedure, the tribunal will decide the procedures, subject to the rules of the arbitration centre administering the case.

Arbitrator’s powers

17. What procedural powers does the arbitrator have under the applicable law? If there is no express agreement, can the arbitrator order disclosure of documents and attendance of witnesses (factual or expert)?

Under Article 49 of the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) a tribunal has the right to apply interim injunctive relief based on a party’s request. The Civil Judgment Enforcement Authority will assist in carrying out the orders of a tribunal.

In addition, under Article 46 and Article 47 of the LCA, an arbitrator has the right to request that other organisations or individuals provide evidence or witness statements. However, in the case of non-cooperation, the tribunal can only request assistance from a competent court.


18. What documents must the parties disclose to the other parties and/or the arbitrator? How, in practice, does the scope of disclosure compare with disclosure in litigation? Can the parties determine the rules on disclosure?

Scope of disclosure

Parties have the obligation to provide documents in support of their claims and establish facts relevant to the issues under dispute (Article 46, Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA)). However, there are no specific laws obliging the parties to provide any documents. In the event a party does not disclose supporting documents, there is no administrative or criminal sanction, but the party’s arguments can be severely undermined and not accepted by the tribunal.

There is no difference between disclosure in arbitration and litigation. Vietnam does not have any laws permitting party discovery. A tribunal can request the parties to provide evidence, but parties must make any request for evidence through a court or tribunal. There is no guarantee that a court or tribunal will accept a request. If a party refuses to provide evidence, there is nothing a tribunal can do. A party can seek court intervention, but the outcome is not predictable.

Parties’ choice

There are no provisions under the LCA that allow or disallow the parties to agree to what documents or information will be disclosed by either side.


19. Is arbitration confidential?

Arbitration proceedings are confidential under the Article 4 and 21 of the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA).

Courts and arbitration

20. Will the local courts intervene to assist arbitration proceedings?

Any competent court in Vietnam can intervene, at a party’s request, to assist arbitration proceedings. A competent court has the powers to order any of the following:

  • Appoint an arbitrator in an ad-hoc arbitration.

  • Replace an arbitrator in an ad-hoc arbitration.

  • Decide the validity and scope of arbitration agreements.

  • Assist in the collection of evidence.

  • Apply interim injunctive relief.

  • Summon witnesses.

21. What is the risk of a local court intervening to frustrate the arbitration? Can a party delay proceedings by frequent court applications?

Risk of court intervention

A party can frustrate or delay the arbitration proceedings with frequent court applications. However, any request for court intervention must comply with relevant laws. For example, a party can dispute the validity and scope of an arbitration agreement. If the party fails, the party can later challenge the appointment of an arbitrator, the mode of collecting evidence or later request an arbitral award be cancelled on applicable grounds. If there is a legal basis for the request, a party cannot be prevented from seeking judicial intervention.

Delaying proceedings

The Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) prohibits the parties from delaying the proceedings (that is, providing claims and defences, disclosing supporting documents and witnesses in an untimely manner). In the event a party seeks judicial intervention, the arbitral proceedings will continue until and unless a court issues a decision that requires the arbitration to cease temporarily or permanently.

22. What remedies are available where one party denies that the tribunal has jurisdiction to determine the dispute(s)? Does your jurisdiction recognise the concept of kompetenz-kompetenz? Does the tribunal or the local court determine issues of jurisdiction?

A party can raise the lack of jurisdiction argument with the tribunal or a competent court under the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA). Vietnam laws recognise the concept of competence-competence, even requiring the tribunal to first decide its jurisdiction. This power is not exclusive and can be reviewed by a competent court, whose decision is final and binding on the parties and the tribunal.

The arbitral proceedings continue until the court decides that there is no valid arbitration agreement or limits the subject matter subject to arbitration.


23. What interim remedies are available from the tribunal?


The tribunal can award security, resorting to the rules of the administering body (if applicable) (Article 34, Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA)).

Other interim measures

The tribunal can order the following interim measures or interim injunctive relief (Article 49, LCA):

  • Prohibit any change in the status of assets under dispute.

  • Prohibit or force a party to take action that would prevent the proceedings from being adversely affected.

  • Seize assets under dispute.

  • Order the preservation, storage, sale or disposal of any asset under dispute.

  • Request temporary monetary payment between the parties.

  • Prohibit the transfer of assets under dispute.

24. What final remedies are available from the tribunal?

The tribunal has broad powers to award appropriate remedies, such as damages, injunctions, declarations, costs and interest. However, the remedies must have been specifically requested by a party and not be contrary to the fundamental principles of Vietnamese law. Remedies that are immoral, illegal or manifestly unreasonable, including excessive punitive or exemplary damages, may be deemed to contravene fundamental principles of Vietnamese law.


25. Can arbitration proceedings and awards be appealed or challenged in the local courts? What are the grounds and procedure? Can the parties effectively exclude any rights of appeal?

Rights of appeal/challenge

The parties in an arbitration proceeding have the right to challenge and cancel an unfavourable award by lodging a petition with a local competent court (setting aside the award). An award cannot be appealed, that is, the merits of the underlying dispute cannot be re-adjudicated.

Grounds and procedure

A party must lodge a request to cancel an adverse award with a competent court within 30 days of receipt of the award. The merits of the dispute cannot be re-litigated. The aggrieved party can only request the court to review and cancel the award on the following grounds:

  • Whether there exists a valid arbitration agreement.

  • Whether the subject matter decided by arbitration falls within the jurisdiction of the arbitral tribunal.

  • Whether the arbitral tribunal was properly convened and whether the arbitration proceedings followed applicable procedures.

  • Whether the evidence was properly submitted.

  • Whether the arbitral tribunal was objective and impartial.

  • Whether the award contravenes fundamental principles of Vietnam law.

Recently there is an alarming trend of awards being set aside. Some of the awards are set aside on the grounds that there was no arbitration agreement, or that pre-arbitration negotiations were not exhausted. Some awards are set aside because it is contrary to the fundamental principles of Vietnam law, such as the principle of pacta sunt servanda (or the principle of objectivity).

This trend is a growing concern because court decisions setting aside arbitral awards are not usually subject to revision or appeal. There is a possibility that the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) may be amended to address this shortcoming and allow court decisions to be appealed and/or revised.

Excluding rights of appeal

There is no right to appeal arbitral awards. However, the grounds to set aside an award can be considered waived if not properly reserved. Under Article 13 of the LCA, one party waives its rights to protest violations of the LCA, if during the arbitration proceedings the perceived violations were not properly raised. However, this Article does not apply if the award contravenes fundamental principles of Vietnamese law.

26. What legal fee structures can be used? Are fees fixed by law?

There are no prohibitions on the type of fee structures that can be charged by lawyers representing parties in arbitration proceedings.

27. Does the unsuccessful party have to pay the successful party’s costs? How does the tribunal usually calculate any costs award and what factors does it consider?

Cost allocation

The unsuccessful party must pay the arbitration costs (not lawyer fees) unless otherwise agreed to by the parties or ordered by the tribunal (Article 34, Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA)).

Cost calculation

The LCA defines arbitration costs as the:

  • Remuneration paid to the arbitrators.

  • Travel and other expenses incurred by the arbitrators.

  • Consultation of expert witnesses or other assistance requested by the arbitrators.

  • Cost of administering the arbitration and other services provided by the arbitration centre.

The costs usually correspond with the amount of dispute, and not with the time spent by the arbitrators.

Factors considered

The LCA allows the tribunal to allocate the costs between the parties, but in general the losing party bears the costs.

Enforcement of an award

Domestic awards

28. To what extent is an arbitration award made in your jurisdiction enforceable in the local courts?

A domestic arbitration award is fully enforceable, unless there are grounds for cancellation. The award creditor can request the provincial civil judgment enforcement authority where the award was issued to execute the award. In the case of an ad hoc arbitration award, the award creditor must first register the award with a competent court before requesting the civil judgment enforcement authority to carry out the award.

29. Is your jurisdiction party to international treaties relating to recognition and enforcement of foreign arbitration awards, such as the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (New York Convention)?

Vietnam has been a member of the New York Convention since 1995. Vietnam made four reservations at the time of agreement:

  • The New York Convention applies to contracting states.

  • The New York Convention applies to non-contracting states on the basis of reciprocity.

  • The New York Convention will be applied only to commercial disputes as determined under the laws of Vietnam.

  • The interpretation of the New York Convention before Vietnamese courts or competent authorities must be in accordance with the Constitution and the law of Vietnam.

30. To what extent is a foreign arbitration award enforceable in your jurisdiction?

To enforce a foreign award in Vietnam (including from the UK and the US) a party must first file a petition with the Ministry of Justice (MOJ) in the country’s capital, Hanoi (along with the award and relevant documents). The MOJ reviews the documents for compliance with procedural requirements and then transfers the documents to a competent court. The competent court then notifies the award debtor and the public prosecutor before considering the petition.

The grounds for refusing recognition and enforcement are those set out in Article V of the New York Convention and Article 370 of Vietnam’s Civil Procedure Code.

Length of enforcement proceedings

31. How long do enforcement proceedings in the local court take, from the date of filing the application to the date when the court makes its final order? Is there an expedited procedure?

The award debtor has 30 days after compliance is required to satisfy the award. If the award is not satisfied, the award creditor can request a competent enforcement agency to enforce the award after it has become final.

In contrast, the procedure for the recognition and enforcement of foreign arbitral awards is more time consuming. It can take one to two years from the date of submission to receive a final order. This is despite the approximate timeline of five months provided in the Civil Procedure Code 2004 (CPC) from the time the petition is first lodged with the Ministry of Justice until a final decision is rendered by the Supreme Court.


32. Are any changes to the law currently under consideration or being proposed?

Amendments to the Law on Commercial Arbitration No. 54/2010/QH12 dated 17 June 2010 (LCA) are currently under consideration to reduce the risk of awards being set aside. The discussions are very preliminary and no changes are expected in the coming year.

The Supreme Court has issued a Resolution and an Official Letter that clarify the grounds to set aside foreign arbitral awards. Resolution 01 was made effective on 01 July 2014. In addition to clarifying the grounds to cancel foreign arbitration awards, Resolution 01 reaffirms the jurisdiction of Vietnamese courts to issue interim injunctive relief. Official Letter No. 246/TANDTC-KT was sent to all provincial level courts in Vietnam, providing guidance on the application of the New York Convention with respect to foreign arbitral awards. Specifically, the Letter reminds the lower courts to apply the substantive laws and arbitration rules selected by the parties and not the Vietnamese Civil Procedure Code.

Main arbitration organisations

Vietnam International Arbitration Centre (VIAC)

Main activities. The VIAC is responsible for resolving commercial, construction and financial disputes

The Financial and Commercial Centre for Arbitration (FCCA)

Main activities. The FCCA is responsible for resolving financial, construction and investment disputes

The Asean International Commercial Arbitration Centre (ACIAC)

Main activities. The ACIAC resolves commercial disputes

The Pacific International Arbitration Centre (PIAC)

Main activities. The PIAC resolves commercial disputes

Online resources

Office of National Assembly

Description: The website is provided by the Office of National Assembly. It provides Vietnamese versions of soft copies of the constitution, laws, ordinances, decrees, circulars and other sub-law documents.

Description: The website is unofficial, but the largest provider of English-language translation of Vietnamese laws.

Description. This is a legal blog run by LNT & Partners that has insight reviews and connects between the facts and the laws (including arbitration).


Description. This is a law blog run by Allens Linklaters, which provides a subscription database of Vietnam law in English.

Contributor profiles

Le Net, Partner, VIAC Arbitrator

LNT & Partners

T + 84 83 8212 357
F + 84 80 9103733

Professional qualifications. Vietnam, Attorney at Law.

Areas of practice. Infrastructure; financial services; dispute resolutions.

Non-professional qualifications. Lecturer, Ho Chi Minh City University of Law.

Recent transactions

  • Acting for the employer in a US$150 million ICC construction arbitration on the Saigon River Tunnel and East West Highway.
  • Advising the employer on the US$2.7 billion Metro Line No 2 Ho Chi Minh City
  • Advising the lenders in a US$345 million oil and gas project finance.

Languages. English, Vietnamese, Polish, French.

Professional associations/memberships. Vietnam International Arbitration Centre, Arbitrator. Drafting Committee, Principles of Asian Contract Law.


  • Vietnam Contract Law, International Encyclopaedia of Laws, Kluwer Law International, Boston (1ST Edition, 1999, 2ND Ed 2012, 3RD Ed 2014).
  • Vietnam Corporate and Partnership Law, International Encyclopaedia of Laws (co-author), Kluwer Law International, Boston (1ST Ed 2012, 2ND Ed 2014).
  • Vietnam Intellectual Property Law, International Encyclopaedia of Laws (co-author), Kluwer Law International, Boston (1ST Ed 2012, 2ND Ed 2014).

The First Double Taxation Avoidance Agreement between Vietnam and USA

On 7 July 2015, The Socialist Republic of Vietnam (Vietnam) and The United States of America (US) signed the first income tax treaty – Double Taxation Avoidance Agreement (DTAA or the Treaty) – and adopted a Protocol between the two countries for the avoidance of double taxation and prevention of fiscal evasion of taxes on income. This Treaty will take effect after being ratified by each country and exchanged the instrument of ratification by the two jurisdictions. According to Deputy Minister Do Hoang Anh Tuan, Ministry of Finance, the ratification period will take approximately one year.

DTAA aims to eliminate the double taxation of income or gains arising in one contracting state and paid to the other contracting state and prevent the fiscal evasion regarding income taxes of any persons or companies from the contracting states.

For Vietnam, the applicable taxes shall include personal income tax and business income tax, likewise, the applicable taxes in the US are the Federal income taxes imposed by the Internal Revenue Code and the Federal taxes imposed on the investment income of foreign private foundations.

The DTAA also provides a number of key provisions on how to avoid the double tax.

  1. The broader definition of “resident status of a contracting state” and “permanent establishment”

The Treaty provides similar manners to determine a resident of a country to Vietnam’s provisions. Notably, the term of “residence of an individual” is also defined as the established and maintained place of the pension fund or organization that his incomes or gains are derived from.

Under the Treaty, permanent establishment consists of building sites, construction, exploration, assembly or installation of project, supervisory activities which last more than 06 months in a contracting state. The definition is expanded to encompass the place of providing consultancy services for the same and connected project within a contracting state for a period or periods computing more than 06 months within any by an enterprise of the other contracting state.

2. The maximum allowable tax rates of dividends, interests and royalties

The Treaty regulates the maximum allowable tax rates of dividends, interests and royalties as follow:

  • The maximum tax rate on dividends is 5% if the beneficiary is a Vietnamese company owning directly at least 25% of the voting stock of an American distributing company or an American company owning directly at least 25% of the capital of a Vietnamese distributing company. Such dividends are taxed in the country of which the distributing company is considered as resident. All other cases are taxed 15% of the gross amount of dividends.
  • The Treaty also provides that dividends paid by an American Regulated Investment Company (RIC) have maximum tax rate at of 15%. However, the dividends paid by an American Real Estate Investment Trust (REIT) or Vietnamese Real Estate Investment Fund (VREIF) are subject to a maximum tax rate of 15% if only the specific thresholds are met.
  • Article 11 of the Treaty provides that the maximum allowable tax rate of interest is at 10% of the gross amount. However, if interest payments are determined with references to receipts, sales, income, profits or other cash flow of the debtor, to any change in the value of any property of the debtor or to any dividends, partnership distribution or similar payment made by the debtor, the maximum rate can increase up to 15%.
  • Under the Treaty, royalties are sourced to the residence of the payer. The payments specified in the Article 12.3(a) of the Treaty are taxable at a maximum rate of 5%. Royalties paid for the use of or the right to use any copyright of literary, artistic, scientific or other work or any patent, trademark, design or model, plan, secret formula or process will be subject to a maximum allowable 10% tax rate.


Effect of eliminating double taxation in Vietnam

Individuals or companies who are considered as Vietnamese residents are granted the benefits of a credit for income taxes paid on income, profits and gains in the US. Moreover, Vietnamese companies owning at least 10% of the voting rights of a company which is a resident of the US can obtain an indirect tax credit in the US.

By Vietnam Law Insight (LNT & Partners)

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

New Proposals for Commercial Mediation (ADR)

As a matter of implementing Resolution No. 49-NQ/TQ of the Politburo dated 2 June 2005, as well as implementing Vietnam’s commitments on acceding to the WTO, the State has been developing the new Decree to govern the alternative dispute resolution (ADR) for commercial disputes, called commercial mediation.

According to the draft composer, the Decree shall adopt relevant principals of UNCITRAL’s Model Law, these principals are:

  • The mediation process must always have the presence of a neutral third party to assist the parties in the dispute to settle.
  • Mediation is a voluntary solution, except unless otherwise required by laws or the type of dispute.
  • The parties in dispute participate in the process of mediation to build and to reach a mutual agreement themselves.
  • Mediation creates a safe, friendly communication environment for the parties in the dispute.
  • Mediation could be an independent procedure or part of court or arbitral procedure.
  • Mediation is confidential.
  • Mediation does not affect or prevent the parties from using other dispute resolution methods.

For a summary of the above principals, it is concluded that if mediation is successful, the parties would have another agreement to settle the dispute, called the settlement agreement. In case either party does not honor the settlement agreement, the remaining party could request that the court or arbitration make a request for honoring the settlement agreement.

Within the content of this article, we will discuss the binding effect of a settlement agreement under the draft Decree on Commercial Mediation dated 17 June 2015.

According to Articles 25 and 26 the draft Decree, it is written that a settlement agreement would have the effect of binding the obligations of the involved parties. Also, either party has the right to request the Court to recognize the settlement agreement. The procedure and process make the request to the Court must follow the regulations of Civil Procedure Code.

Speaking of this, we are of the opinion that when drafting the Decree with the above contents, there are two issues to be discussed:

  • First, it is contrary to the principals of the UNCITRAL’s Model Laws that mediation result is some form of a new agreement, or a new contract between the parties in dispute. The point is that, in other countries, in the event that one party breaches the settlement agreement, the remaining party can bring the settlement agreement to court or arbitration. At this stage, the court or arbitration shall not re-adjudicate the whole relationship or issues before the time the parties enter into the settlement agreement, but only review the settlement agreement as a new contract between the parties that replaces any other previous issues.
  • Secondly, there is currently no specific provision in both the Law on Commercial Arbitration or the Civil Procedure Code. Therefore, the Law on Commercial Arbitration and the Civil Procedure Code must be amended to be suitable for this Decree, however this solution is not possible. Moreover, there are some opinions that currently, the procedure for recognizing a foreign award or judgment is very complicated and risky, therefore, to add this issue may result in more complexity to the system.

We are of the opinions that Articles 25 and 26 of the draft Decree should be amended in the approach that the settlement agreement is a new contract that replaces all other previous issues relating to the parties, in case where one party dishonors the settlement agreement, the other party can request the court or arbitration to instigate a new case for its enforcement.

By Vietnam Law Insight (LNT & Partners)

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

New Legal Framework to Streamline Licensing and Set up of Commercial Banks

The Content of the new Framework

On June 30th, 2015 the Government issued Circular No. 08/2015/TT-NHNN (Circular 08) in lieu of Circular No. 40/2011/TT-NHNN (Circular 40) for the issuance of licenses and the organization and operation of commercial banks, foreign bank’s branches, representative offices of foreign credit institutions, other foreign organizations that have banking activities (Commercial Banks)  in Vietnam.

This Circular 08 has formulated a full and basic legal framework on procedures for, and dossiers on amendments, supplementation regarding operation contents of Commercial Banks. Furthermore, the formality of proposal dossiers for operational licensing and new establishment license template of Commercial Banks are also regulated in such a new circular.

Besides the new licensing issuance procedure in Circular 40, Circular 08 is expected to add three more new licensing procedures for Commercial Banks, including license replacement issuance, supplementation issuance of operation content to present license and supplementation issuance of operation content associated with license replacement issuance. With respect to the principle of building licensing dossiers, the non-notarized counterpart of documents are duly accepted, provided that those are obtained along with original copy for reference; while the referring person shall sign for confirmation and shall be responsible for the documents’ accuracy. The new establishment license template has the operation content part specifically noting that all banking functions which Commercial Banks are entitled to conduct are in accordance with Law on Credit Institutions and others activities approved by the State Bank.

Business implications

With respect to changes in the State Bank’s licensing activities applied to Commercial Banks in Vietnam, the impact on business will specifically be in banking sector. Accordingly, all approval for changes in registration for the operation of credit institution shall be noted in the Operation License by license replacement issuance. In the event of an amendment or supplementation in the operational content without need for a replacement license, Commercial Banks shall still conduct the proposal procedure on supplementing operation content via the approval instruments of the State Bank. Approval for non-notarized documents in the application dossier shall benefit from a more prompt and efficiently implemented licensing procedure. The more detailed and obvious the licensing procedures is, the more conveniently credit institutions can implement their business.

Our Recommendation

In light of this, we would recommend that commercial banks, branches and representative offices of foreign banks should update their Operation License by implementing the license replacement issuance procedure. The above-mentioned action shall result in owning a kind of detailed and unique valid instrument as a basis of banking operation. With efforts to comply with such new provisions, Commercial Banks shall benefit from good, efficient performance that will positively develop their business.

The Circular No. 08/2015/TT-NHNN will come into effect on August 13th, 2015.

By Vietnam Law Insight (LNT & Partners)

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Người lao động có đang thờ ơ với quyền lợi của mình?

Bảo vệ quyền và lợi ích hợp pháp của người lao động là vấn đề cơ bản và xuyên suốt của Bộ Luật Lao Động. Nhiều nước trên thế giới kể cả Việt Nam đang đặt mục tiêu thúc đẩy bình đẳng trên thị trường lao động, đặc biệt là thúc đẩy sự tham gia của nữ giới trong thành phần lãnh đạo. Tuy nhiên, bình đẳng ở đây liệu có nhất thiết là tuyệt đối quân bình về số lượng? Trong tất cả ngành nghề, liệu có phải ngành nào cũng có cơ hội cho nữ giới?

Chương trình được thực hiện bởi Smart Money, Smart Life – FBNC với sự tham gia trả lời phỏng vấn của ông Trần Thái Bình, luật sư thành viên công ty luật LNT & Partners.

FBNC _ Thúc đẩy bình đẳng giới trong lao động như thế nào là bình đẳng? LNT & Partners

Để tìm hiểu thêm về chương trình xin vui lòng truy cập website và

South Korea – Vietnam: Bilateral Free Trade Agreement

South Korea and Vietnam have recently engaged in developing their political and economic ties; the zenith of which was reached with the signing of a bilateral Free Trade Agreement  (“FTA”) between the two countries on May 5th, 2015 in Hanoi.  The FTA is expected to bring exponential surges in the bilateral trade between the two countries, in which the Vietnamese government has agreed to remove tariffs on 89.9% of products imported from South Korea over a period of 15 years. Likewise, South Korea is planning to revoke tariffs on 95.4% of all products imported from Vietnam. The two partners are currently ratifying the agreement before it is due to take effect late this year.

The both countries anticipate further growth in the volume of bilateral trade, which has reached a record high of US$30 billion in 2014. Additionally, with the agreement in place, Vietnam foresees substantial inward investment growth from South Korea which stood at approximately US$5.8 billion in November 2014.

By Vietnam Law Insight (LNT & Partners)

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

New Law on Investment Effective on 1st July

The new Law on Investment (LOI) has become effective as of 1st July. The final draft Governmental Decree implementing the LOI, as well as the draft Circular implementing the Decree is now being prepared by the Ministry of Planning and Investment (MPI) for issuance.

CV 4326 BKHDT-DTNN huong dan tam thoi 30-6-2015

Meanwhile the MPI has issued Official Letter 4326 /BKHĐT-ĐTNN (OL 4326) for ad hoc guidance to implement the new LOI, as well as the forms to be used from 1 July 2015 to obtain the Investment Registration Certificate (IRC) and its amendments; they key points are:

  1. Online application for IRC: investors can file IRC application online at the National Investment Portal [NIP], and submit a paper dossier within 15 days from the online filing. In the event that the dossier is accepted, the investors will be given a temporary account to check the application status. Any incorrect or incomplete application must be notified within 3 days from receipt by the licensing authority.
  2. Project Code: the project code is a 10 digit code to be issued to the applied project (Project) during its operation.
  3. Forms issued: among the forms submitted, please noted that CPC Code and VSIC Code (for business line) is still required when submitting to obtain the IRC. Separate forms are also available for amendments to the project.
  4. M&A approval: the form for M&A approval is on form I.6 attached to OL 4326. This form is simplified, and the explanation to satisfy conditions for M&A is rather brief and must strictly follow the WTO Commitment. It is unclear how other restrictions under local laws could be satisfied or would need to be satisfied (e.g. ENT for distribution companies).
  5. Forms of decisions and IRCs: OL 4326 also provides new forms of IRCs, Principle Approvals and other decisions for authorities to use.

While it is a progressive move forward, there are issues still to be clarified (as noted in our previous alert on OL 4211). Any questions are encouraged to be addressed to the Foreign Investment Agency (FIA) for guidance.

By Vietnam Law Insight (LNT & Partners)

For more information about this article, please contact the author: Dr. Le Net, LNT & Partners, at the email:

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Vietnam Opening the Doors for Portfolio Foreign Investment

Following the relaxation of the foreign investment procedure under the new Law on Investment (LOI) and the Law on Enterprise (LOE), the Government has now also relaxed the room for portfolio foreign investment as well as the equitization of state owned enterprise (SOEs).

Furthermore, the Decree provides for the equitization of state owned enterprises (SOEs), and this action is expected to attract more share acquisition in stock markets as well as private equity soon. Currently, a foreign investor may purchase up to 49% of total shares of public joint stock company (JSC) or a listed company.  From 1 September 2015, this general restriction will be removed under Decree 60/2015/NĐ-CP dated 26 June 2015 (Decree 60).

Click here to downloa Decree 60 – Open Doors for Portfolio Foreign Investment

Instead, the new restriction will be subject to the WTO commitments or other specific domestic law (e.g., the 30% cap in the banking sector). If there is a specific restriction under domestic law that has yet to be specified, then the rule of thumb is 49%.

When there is no restriction under domestic law (e.g., for production companies, or distribution companies), then there is no limit for the foreign shareholding ratio. This rule also applies to equitized SOEs, with the aim of attracting more foreign investment in the privatization program.

As for securities companies (or investment banking), those who are eligible to establish 100% foreign owned securities companies are allowed to buy up to 100% equity of local securities companies. Those who are not eligible can acquire up to 51% total shares.

Decree 60 also lifts all restrictions to foreign investors to invest in bonds. With respect to share certificates or derivative products of stocks of JSCs, the restriction will be relaxed as mentioned above. For this purpose, open funds or securities funds that have foreign shareholding more than 51% equity will be deemed as foreign investors.

In addition, Decree 60 addresses the following changes:

  1. Private placement of public companies
  2. Share swap of public companies
  3. Public offering of shares in public companies for swapping shares in non-public companies, or equity in limited liability companies
  4. Private placement filing at the State Securities Commission (SSC) for public companies
  5. Public offering process, use of escrow account for public offering proceeds
  6. Public offering of investment certificates or shares abroad
  7. Redeem shares
  8. Tender offers
  9. Sale of treasury shares
  10. Listing of merged or amalgamated companies
  11. Upcom transaction registration and listing
  12. Real estate capital valuation and contribution to real estate investment fund

While opening the door to, and creating more options for foreign portfolio investment, as along with the deregulation of various procedures at SSC are certainly attractive to foreign investors, it is unclear how other restrictions under different ministries, such as Ministry of Health, Ministry of Education, Ministry of Industry and Trade may impact on the intention of the Government to open up the market.

Note that Art 74.3 LOI allows for the “non-compliant” restriction of business to be valid until 1 July 2016, suggesting there could be some more grounds of clarification and explanation to come.

By Vietnam Law Insight (LNT & Partners)

For more information about this article, please contact the author: Dr. Le Net, LNT & Partners, at the email:

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Conditional Acceptance of the Construction Works for Commissioning

The Law

On 15 May 2015 the Government issued Decree No. 46/2015/ND-CP (Decree 46) to provide further guidance on the Law on Construction 2015 with respect to quality management and maintenance of construction works, pointing out:

“The responsibility for the quality of the works remains with the survey construction contractors, design contractors, and supply contractors, even after their work has been inspected and accepted by the employer, or after the defect liability period has expired. This means that these contractors may be held liable for damages evidenced to be caused by the quality of their works.”

What does it mean for businesses?

Under Decree 15/2013/ND-CP, acceptance of construction works for commissioning into use when they have not satisfied all requirements of the design, of national technical regulations, of standards applicable to the construction works, and the technical specifications and other requirements of the employers specified in the agreements is generally not allowed.

However, Decree 46 entitles the employer to conditionally accept the construction works for commissioning into use, if the issues with respect to quality of construction works do not affect the weight-bearing capacity, the life cycle and the functions of the works and if the construction works conform to the safety requirements.

Decree 15/2013/ND-CP allows the employer and contractor to freely agree on the minimum amount of the warranty fee retained by the employer. However, to the extent of State owned works, this has been restricted by Decree 46. Accordingly, the warranty fee for State owned works must not be less than 3% of the contract value for works of grade 1 or special grade, and 5% of contract value for the works of other grades.

Decree 46 stipulates that survey contractors should pay significant attention to the quality of their works. Therefore, we suggest that survey contractors to provide sufficient and eligible resources to ensure their works are compliant with the technical plan, as this is required by Decree 46. We would also warn that the Decree also entitles the employer to completely suspend the construction survey works upon finding them not compliant with the technical plan, or the construction survey agreement.

Decree 46 will take effect from 01 July 2015

By Vietnam Law Insight.

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Expands Customs Priority Policy to Brokers and Key Investment Projects

New Circular from the Ministry of Finance Expands Customs Priority Policy to Brokers and Key Investment Projects

The law

On 12th May 2015, Ministry of Finance issued Circular No. 72/2015/TT-BTC that will regulate on the application of priority policies in customs procedures, customs inspection and supervision for exported and imported goods of enterprises (hereinafter referred to as “Circular 72”). Circular 72 will replace Circular No. 86/2013/TT-BTC dated June 27, 2013 (hereinafter referred as “Circular 86”) and Circular No. 133/2013/TT-BTC dated September 24, 2013 of the Ministry of Finance.

Under the new circular, the priority policy has had its subject and scope broadened and expanded, with the conditions for application of priority now less strict, and the procedures simplified in comparison with the previous Circular 86.

The customs priority regime will be expanded to include eligible customs brokers and projects, rather than only for enterprises, as noted in the previous Circular 86. The scope of privileges has expanded beyond just businesses to include various subjects including enterprises, customs brokers and key investment projects agreed by the Prime Minister. The conditions stated for the amount of import or export turnover for enterprises has been reduced from US$200 million annually to US$100 million annually.

What does this mean for businesses?

In terms of procedures, Circular 72 waives the stage of undertaking the Memorandum of Understanding (“MOU”) in the verification process. Instead of separating the appraisal procedure into two stages which are generating the MOU and issuance of the Decision on recognition of prioritized enterprises as stipulated in Circular 86. Circular 72 streamlines the process as the Decision will be signed by the Director of the General Department of Customs within 10 working days since the completion of inspection process, without making the memorandum if enterprises meet the conditions for application of priority policy. Moreover, enterprises will submit the dossiers to the Customs Department of the province where the headquarters of the enterprise is located, instead of the General Department of Customs. Furthermore, the right to customs clearance with incomplete declarations will be granted to enterprises more generally, instead of only applying this in the event that the database system of the customs offices meet malfunction or temporarily stop operation.

Businesses should also note that the time schedule for the processing of dossiers is not clearly stated in this Circular, while Circular 86 explicitly specifies that the time limit for consideration to recognize the prioritized business shall not exceed 45 working days.

Circular 72 will take effect on 26th June 2015.

By Vietnam Law Insight.

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

New Legal Framework for Vietnam’s Nascent Derivative Securities Market

The Law

On 5 May 2015, the Government issued Decree No. 42/2015/ND-CP on derivative securities and the derivative securities market, which is considered as the very first legal framework for the derivative securities market of Vietnam to come into operation in 2016.

This Decree recognizes futures contracts, options and forward contracts of which objects are underlying assets being securities and/or other assets used as the basis for fixing the value of the derivative securities as derivative securities. There will also be other kinds of derivative securities as recognized in accordance with guidelines of the Ministry of Finance. These newly recognized derivative securities may be traded on the derivative securities market as provided by the laws.

In principle, any organization or individual may invest in derivative securities on the derivatives market, except for certain organizations, such as securities companies, fund management companies, credit institutions and State-owned companies, which must satisfy certain requirements before investing in the market.

Furthermore, for the purpose of conducting derivative securities trading and/or providing derivative securities clearance and payment services, an organization will need to obtain a certificate of satisfaction of conditions for the respective activities issued by the State Securities Commission. To obtain this certificate, in general and subject to activities registered to be conducted, the organization must satisfy a number of conditions, such as financial conditions, i.e. minimum charter capital; conditions on business results, ratios of available capital, professional rules and/or relevant requirements to be provided by the Ministry of Finance; and other conditions as provided.

What does this mean for businesses?

Through there has been a legal framework for securities trading in Vietnam since the introduction of the Law on Securities (70/2006-QH11), Decree 42/2015/ND-CP allows for more diversified securities products in the Stock Exchange, thus boosting liquidity in the securities market which will be great news for businesses that are increasingly using the Stock Market as a capital channel. Accordingly, Decree 42/2015/ND-CP is expected to support the securities market of Vietnam, increase competitiveness and help to narrow the gap between securities market of Vietnam and of other countries all over the world.

Decree 42 will take effect on 1 July 2015.


By Vietnam Law Insight.

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Vietnam, FDI and the TPP ISDS: a Tentative Look

The Trans-Pacific Partnership Agreement (“TPP”) is a multilateral agreement currently being negotiated that, when finally agreed, will encompass approximately 40% of the worlds GDP under a new generation of multilateral economic governance that is focusing on competition policy, labour rights, international investment law and the harmonization of other areas of law and aimed at boosting trade, investment and economic growth between members, who at the advanced negotiation stage include Japan, the USA, Vietnam, Australia, Singapore, Brunei, Malaysia, New Zealand, Chile and Peru, with Canada and Mexico interested in joining. One of the most controversial aspects of the negotiations is that they are largely being held behind closed doors – with only limited information on draft chapters being released through memorandums, or via the medium of Wikileaks, hence why this short article is a tentative look – a detailed analysis at this stage is not possible until the final draft is released or leaked, which will not be for some time yet. This lack of transparency has helped foster strong opposition to the agreement before even considering the provisions contained within. This article considers some implications of the TPP’s Investor-State Dispute Settlement (“ISDS”) for investors of inward and outward FDI in Vietnam.

Opposing views mean uncertainty for ISDS in TPP

The ISDS provisions of the TPP have both strong support, and strong disapproval. The strong support comes primarily from the Japanese and US governments and firms that see the ISDS as crucial to the success of the TPP, and the need to protect their investment interests particularly in the SE Asian parties to the agreement. On the opposing side, with a particularly vitriol response is Australia, which has undergone a unique policy shift among developed countries and chosen to accommodate anti-ISDS voices, arguing that it ISDS is a threat to domestic rule of law and has an undermining effect on national judiciary systems. In light of this, Australia has become a proponent to abandoning the ISDS mechanism in the TPP. While the inclusion of an ISDS is still highly likely to be included as part of the agreement – with the USA pressuring opponent parties to endorse the ISDS – and arguing that there won’t be a TPP without it, there is still uncertainty around how the final draft of the TPP will be structured.

ISDS could bring new forms of investment to Vietnam

The inclusion of ISDS into the TPP agreement could have the effect further reducing the risk associated with foreign investment, which could encourage companies from developed countries party to the TPP such as those in the US, to engage in “discretionary” outsourcing, this refers to foreign investment that does not require a foreign presence to be successful (while “non-discretionary” investment outsourcing refers to investment that requires outsourcing to a foreign jurisdiction to be financially viable) , and to ensure performance, would usually be kept in the home country jurisdiction where investment is less risk averse. Such investment can include high quality manufacturing, research and development and others. This discretionary investment could further raise investor confidence in Vietnam as a destination for high tech, R&D and other forms of investment.

Vietnamese outward investment could be boosted

2014 was regarded as a bumper year for Vietnamese outward FDI, with approximately US$1 billion going to 129 projects around the world. While the biggest recipients of Vietnamese FDI have been Myanmar and Cambodia, the US and Singapore were also destinations, both of whom are parties to the TPP negotiations. This suggests that Vietnamese firms would be able to benefit from the ISDS mechanisms. While the US and Singapore have highly developed legal frameworks for the enforcement of foreign arbitral awards; both countries and Vietnam are indeed party to the New York Convention, this could seek to enhance Vietnamese enterprises’ access to a neutral ISDS mechanism. The wide scope of the Japanese and American positions on ISDS covering all major contracts between foreign investors and the host state, if agreed, could protect many forms of Vietnamese FDI to the US and Singapore.

A potential Appellate structure could enhance ISDS for investors

Although not confirmed as yet, the US has taken a leading role in the TPP negotiations in calling for an Appellate structure to the TPP ISDS. Such a mechanism has been widely promoted in US-led international investment agreements, and is included in the US model BIT as a review mechanism. Furthermore, the International Centre for Settlement of Investment Disputes (“ICSID”) secretariat has also considered reform to include an Appellate structure for reviewing arbitral awards. Such a mechanism in the TPP ISDS could have two implications for investors. Firstly, such a structure could harmonize the interpretation of the TPP treaty text, and allow for the correction of awards from the many private commercial arbitration institutions from different jurisdictions that contain different rules of interpretation, and provide a more legitimate investment framework for investors. Indeed, the basis behind the ICSID Appellate structure was to achieve the aforementioned.


This short look at some of the potential implications on both inward and outward investors in Vietnam suggests that there will be benefits to the international framework for investment in the region that will have the effect of boosting investor confidence between TPP members, on the back of a re-energized ISDS mechanism. With suggests that such negotiations are at an “advanced stage”, it is likely that more aspects of the agreement will be made public in the months to follow.


  • Sappideen, R. Ling Ling, He. ‘Investor-state Arbitration: The Roadmap from the Multilateral Agreement on Investment to the Trans-Pacific Partnership Agreement’, 40 Fed. L. Rev. 207 2012
  • Cai, Congyan. ‘Trans-Pacific Partnership and the Multilateralization of International Investment Law’, 6 J. E. Asia & Int’l. L. 385 2013
  • Ikenson, D. ‘A Compromise to Advance the Trade Agenda: Purge Negotiations of Investor-State Dispute Settlement’, 57 Free Trade Bulletin 2014
  • Mayer Brown JSM ‘A Guide to doing business in Vietnam’ 2015
  • Mayer Brown JSM ‘Will Vietnam Sink or Swim Amid a Proliferation of FTA?’ International Trade Asia, 2015
  • Accessed 7/4/15
  • Accessed 7/4/15

By Joseph McDonnell – Vietnam Law Insight.

Disclaimer: This Briefing is for information purposes only. Its contents do not constitute legal advice and should not be regarded as detailed advice in individual cases. For more information, please contact us or visit the website: Http://

Nghị định Hợp tác Công – Tư (PPP), Các dự án cơ sở hạ tầng đã thực sự mở cửa?

Với nhu cầu cơ sở hạ tầng ngày càng cao, trong khi ngân sách và nguồn vốn ODA có hạn, việc kêu gọi tư nhân vào các dự án cơ sở hạ tầng (PPP) được hy vọng là giải pháp khả thi nhất. Trong khi PPP đã thành công nhiều ở các nước ASEAN khác, nhất là Malaysia, thì các dự án PPP ở Việt Nam vẫn đang gặp trở ngại. Vì vậy, việc Nghị định 51 ngày 14 tháng 02 năm 2015 quy định về đầu tư theo hình thức đối tác công tư hy vọng sẽ đáp ứng được mong đợi của nhà đầu tư. Nghị Định 15 có những quy định mới đáng chú ý như sau:

  1. Nghị Định 15 quy định về hình thức các hợp đồng dự án, bao gồm Hợp đồng Xây dựng – Chuyển giao (Hợp đồng BT); Hợp đồng Xây dựng – Chuyển giao – Thuê dịch vụ (Hợp đồng BTL) và Hợp đồng Xây dựng – Thuê dịch vụ – Chuyển giao (Hợp đồng BLT). Như vậy nhà đầu tư không nhất thiết phải chuyển giao công trình cho nhà nước, mà có thể chọn nhiều giải pháp khác nhau, tùy yêu cầu của nhà đầu tư và bên cấp vốn cho vay dự án.
  1. Nghị Định 15 quy định rõ hình thức đầu tư và phân loại dự án được áp dụng hình thức PPP. Bên cạnh các dự án về cơ sở hạ tầng vật chất như cầu, đường, các công trình xây dựng… các công trình về thương mại, khoa học, công nghệ, khí tượng thủy văn, khu kinh tế, khu công nghiệp, khu công nghệ cao, khu công nghệ thông tin tập trung; ứng dụng công nghệ thông tin cũng được đưa vào danh mục các dự án được áp dụng hình thức PPP. Quy định này khuyến khích nhà đầu tư trong lĩnh vực nghiên cứu và công nghệ cao. Nghị Định 15 cũng quy định rõ, các dự án theo hình thức PPP sẽ được phân loại theo dự án quan trọng quốc gia, các dự án nhóm A, B và C. Nhờ đó mà các dự án nhỏ sẽ được thông qua nhanh chóng hơn.  Theo đó, Dự án nhóm C không phải thực hiện thủ tục cấp giấy chứng nhận đăng ký đầu tư.
  2. Nghị Định 15 quy định việc sử dụng vốn đầu tư của nhà nước tham gia thực hiện dự án sẽ được phân bổ c sẽ được dùng chủ yếuu để hỗ trợ xây dựng công trình phụ trợ, tổ chức bồi thường, giải phóng mặt bằng và tái định cư. Tuy nhiên nghị định không nói rõ giá trị quyền sử dụng đất có được tính trong tổng phí đàu tư hay không.
  3. Một trong những điều kiện để lựa chọn dự án là dự án phải có tổng vốn đầu tư từ 20 tỷ đồng trở lên (trừ dự án O&M và một số dự án đặc thù). Ngoài ra, dự án có khả năng thu hồi vốn từ hoạt động kinh doanh sẽ được ưu tiên lựa chọn.
  4. Về nội dung đề xuất dự án, bên cạnh các nội dung về thông tin dự án, yếu tố kỹ thuật… nội dung đánh giá dự kiến sơ bộ rủi ro trong quá trình thực hiện dự án và phân chia rủi ro giữa cơ quan nhà nước có thẩm quyền và nhà đầu tư cũng cần được đề cập.
  5. Nghị Định 15 cũng quy định về thời điểm ký kết hợp đồng dự án. Theo đó, nhà đầu tư đàm phán và ký tắt hợp đồng dự án trước, sau đó được cấp giấy chứng nhận đăng ký đầu tư. Bước cuối cùng mới là ký kết hợp đồng dự án. Như vậy, các thiệt hại, thay đổi hay phát sinh trước khi ký kết hợp đồng dự án có phát sinh hậu quả pháp lý hay không? Vấn đề này vẫn chưa được trả lời.
  6. Về nội dung hợp đồng dự án, Nghị Định 15 liệt kê các nội dung cần thiết trong một hợp đồng PPP, các tài liệu đính kèm cần thiết. Ngoài ra, Nghị Định 15 có quy định mở để các Bộ, Ngành và UBND cấp tỉnh được phép đề xuất một hình thức hợp đồng khác với các hình thức đã được quy định tại Nghị Định 15 để trình Chính phủ xem xét, quyết định.
  7. Nghị Định 15 cho phép chuyển nhượng quyền và nghĩa vụ theo hợp đồng dự án, hoặc chuyển nhượng một phần hoặc toàn bộ dự án. Điều này mở cửa cơ hội chứng khoán hóa (securitization) cho dự án, giải tỏa một phần lo lắng cho các nhà tài trợ hay ngân hàng đối với vấn đề tài chính dự án, nhất là khi chủ đầu tư không đủ năng lực để tiếp tục thực hiện dự án.
  8. Về pháp luật áp dụng, Nghị Định 15 quy định rõ cho phép các bên ký kết có thể thỏa thuận việc áp dụng pháp luật nước ngoài để điều chỉnh các hợp đồng dự án mà một bên là nhà đầu tư nước ngoài hoặc Các hợp đồng được Chính phủ bảo lãnh nghĩa vụ thực hiện. Đây là thay đổi lớn và cho phép các nhà tư vấn tài chính quốc tế được tham gia sâu rộng vào dự án.
  9. Nghị Định 15 quy định về nghĩa vụ bảo đảm thực hiện hợp đồng dự án, tuy nhiên Nghị định lại đưa vấn đề này cho luật đấu thầu giải quyết. Vấn đề bảo lãnh của Chính phủ không được quy định rõ, mà được giao lại cho Bộ Tài chính và Bộ Tư pháp nghiên cứu.
  10. Đối với doanh nghiệp dự án, sau khi được cấp giấy chứng nhận đăng ký đầu tư, nhà đầu tư thành lập doanh nghiệp để thực hiện dự án phù hợp với mục tiêu, phạm vi hoạt động đã thỏa thuận tại hợp đồng dự án. Việc thành lập doanh nghiệp dự án được thực hiện theo quy định của pháp luật doanh nghiệp.
  11. Nghị Định 15 quy định rõ nghĩa vụ giám sát thực hiện hợp đồng dự án của nhà đầu tư, doanh nghiệp dự án và cơ quan nhà nước có thẩm quyền. Việc phân định trách nhiệm cụ thể này là cần thiết để đảm bảo dự án được giám sát thực hiện một cách cẩn trọng. Về giá, phí hàng hóa, dịch vụ và các khoản thu, Nghị Định 15 tôn trọng thỏa thuận của các bên trong hợp đồng dự án, tạo điều kiện để nhà đầu tư thu hồi vốn và lợi nhuận. Đây là cơ sở quan trọng để nhà đầu tư đàm phán giá với các bên cung cấp hay bên mua hàng của nhà nước nếu có các ràng buộc bất lợi cho nhà đầu tư.
  12. Nghị định 15 quy định rõ thời hạn để quyết toán công trình dự án. Theo đó, trong thời hạn 06 tháng kể từ ngày hoàn thành công trình dự án, nhà đầu tư thực hiện quyết toán vốn đầu tư xây dựng công trình.
  13. Về việc thế chấp tài sản, quyền kinh doanh công trình dự án, Nghị Định 15 quy định rõ Nhà đầu tư, doanh nghiệp dự án được thế chấp tài sản, quyền sử dụng đất và quyền kinh doanh công trình dự án tại bên cho vay theo quy định của pháp luật về đất đai và pháp luật về dân sự, với điều kiện thời hạn thế chấp không quá thời hạn hợp đồng dự án. Tuy nhiên, thời hạn thế chấp có thể vượt quá thời hạn hợp đồng dự án nếu có thỏa thuận tại hợp đồng dự án. Về hình thức thỏa thuận thế chấp, thỏa thuận thế chấp tài sản, quyền kinh doanh công trình dự án phải được lập thành văn bản ký kết giữa bên cho vay và các bên ký kết hợp đồng dự án. Như vậy quyền lợi của bên cho vay đối với dự án sẽ được bảo đảm phần nào.
  14. Về việc sử dụng ngoại tệ trong dự án, Nghị Định 15 quy định nguyên tắc Bảo đảm cân đối ngoại tệ. Theo đó, nhà đầu tư, doanh nghiệp dự án được mua ngoại tệ tại tổ chức tín dụng được phép hoạt động ngoại hối để đáp ứng nhu cầu giao dịch vãng lai, giao dịch vốn và các giao dịch khác hoặc chuyển vốn, lợi nhuận, các khoản thanh lý đầu tư ra nước ngoài theo quy định của pháp luật về quản lý ngoại hối
  15. Về vấn đề giải quyết tranh chấp, Nghị Định 15 phân loại các tranh chấp thành (i) Tranh chấp giữa cơ quan nhà nước có thẩm quyền và nhà đầu tư hoặc doanh nghiệp dự án và tranh chấp giữa doanh nghiệp dự án với các tổ chức kinh tế tham gia thực hiện dự án; (ii) Tranh chấp giữa cơ quan nhà nước có thẩm quyền với nhà đầu tư nước ngoài hoặc doanh nghiệp dự án do nhà đầu tư nước ngoài thành lập và (iii) Tranh chấp giữa doanh nghiệp dự án với tổ chức, cá nhân nước ngoài hoặc với các tổ chức kinh tế Việt Nam và tranh chấp giữa các nhà đầu tư. Theo đó, cơ quan giải quyết tranh chấp tương ứng cho các trường hợp nêu trên là tổ chức trọng tài hoặc tòa án Việt Nam theo quy định của pháp luật Việt Nam; Trọng tài hoặc Tòa án Việt Nam hoặc hội đồng trọng tài do các bên thỏa thuận thành lập và được giải quyết theo quy định của Luật Đầu tư. Tranh chấp được giải quyết bằng trọng tài theo quy định tại hợp đồng dự án và các hợp đồng liên quan là tranh chấp thương mại. Quyết định của trọng tài nước ngoài được công nhận và thi hành theo quy định của pháp luật về công nhận và thi hành quyết định của trọng tài nước ngoài.
  16. Nghị Định 15 quy định trách nhiệm của các Bộ, Ngành liên quan. Trong đó, Bộ Kế hoạch và Đầu tư, bên cạnh các trách nhiệm khác, có trách nhiệm cấp, điều chỉnh, thu hồi giấy chứng nhận đăng ký đầu tư đối với các dự án thuộc thẩm quyền; thẩm định nguồn vốn đầu tư của Nhà nước tham gia thực hiện dự án theo thẩm quyền; tham gia ý kiến về các vấn đề thuộc chức năng, thẩm quyền theo yêu cầu của Bộ, ngành và Ủy ban nhân dân cấp tỉnh; Bộ Tư pháp, bên cạnh các trách nhiệm khác, có trách nhiệm Cấp ý kiến pháp lý đối với hợp đồng dự án, văn bản bảo lãnh của Chính phủ và các văn bản liên quan đến dự án do cơ quan nhà nước ký kết.
  17. Đối với các đồng dự án được ký tắt trước ngày Nghị định này có hiệu lực thi hành không phải đàm phán lại. Như vậy các dự án BT trước đây tạm ngưng không thực hiện nay có thể được tiến hành lại.

Những thay đổi tại Nghị định PPP đem lại nhiều dấu hiệu tích cực cho nhà đầu tư lẫn ngân hàng tài trợ. Có một số vấn đề như bảo lãnh chính phủ, hay cam kết quy định về giá, hay hỗ trợ dòng tiền (take or pay) sẽ còn một số điểm phải làm rõ.  Song việc một loạt các dự án PPP đang tiếp tục khởi động, đặc biệt trong lĩnh vực giao thông vận tải, cũng như việc Vietjetair đặt vấn đề mua lại nhà ga T1 Nội Bài cho thấy đây sẽ là động lực để thúc đẩy phát triển và quản lý tốt các dự án cơ sở hạ tầng.

Thực hiện bởi Vietnam Law Insight (LNT & Partners)

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