Arbitration has become an increasingly popular method of dispute resolution in Vietnam, particularly for commercial matters. By opting for arbitration, parties can potentially save time, money, and avoid lengthy court proceedings. In this article, we will provide you with a general overview of the arbitration law in Vietnam and help you better understand this important method of dispute resolution. If you need assistance with arbitration or other legal matters, our law firm is here to help you navigate the complex legal landscape.
I. The Legal Framework for Arbitration in Vietnam
The primary legal framework governing arbitration in Vietnam is the Law on Commercial Arbitration No. 54/2010/QH12, which came into effect on January 1, 2011. This law was drafted based on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration and is generally aligned with international arbitration norms and practices.
In addition to the Law on Commercial Arbitration, the following legal documents also regulate arbitration proceedings in Vietnam:
- The Civil Procedure Code No. 92/2015/QH13, which governs the recognition and enforcement of arbitral awards in Vietnam.
- Decree No. 63/2011/ND-CP, which provides detailed guidance on the implementation of the Law on Commercial Arbitration.
- The Law on Enforcement of Civil Judgments No. 64/2014/QH13, which establishes procedures for enforcing arbitral awards.
II. The Arbitration Process
A. Arbitration Agreement
The arbitration process begins with the parties signing an arbitration agreement. This agreement can be in the form of an arbitration clause in a contract or a separate agreement. The agreement must be in writing and should clearly specify that the parties agree to submit their disputes to arbitration. It is advisable to specify the arbitration rules, the arbitral institution, the number of arbitrators, and the language of the proceedings in the agreement.
B. Arbitral Institutions
Vietnam has several domestic arbitral institutions, including the Vietnam International Arbitration Centre (VIAC), the Pacific International Arbitration Centre (PIAC), etc. Parties can also choose to submit their disputes to international arbitration institutions, such as the International Chamber of Commerce (ICC) or the Singapore International Arbitration Centre (SIAC).
C. Arbitral Proceedings
The arbitration proceedings generally follow the rules of the chosen arbitral institution. These rules typically include provisions on the appointment of arbitrators, the exchange of written submissions and evidence, and the organization of hearings. Arbitration proceedings are usually confidential, and the parties can agree on the language and the applicable law.
D. Arbitral Awards
Arbitral awards are the final decisions made by the arbitrators to resolve the dispute. These awards are binding on the parties and can be enforced in the same way as a court judgment. Vietnam is a signatory to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which means that foreign arbitral awards can be recognized and enforced in Vietnam, subject to certain conditions.
III. Enforcement of Arbitral Awards
A. Domestic Arbitral Awards
The enforcement of domestic arbitral awards in Vietnam is regulated by the Civil Procedure Code and the Law on Enforcement of Civil Judgments. To enforce a domestic arbitral award, the winning party must apply to the competent court for recognition and enforcement within one year from the date the award becomes effective.
B. Foreign Arbitral Awards
Foreign arbitral awards can be recognized and enforced in Vietnam under the New York Convention. To enforce a foreign arbitral award, the winning party must apply to the Ministry of Justice, which will forward the application to the competent court. The court will then review the application and decide whether to recognize and enforce the award. The recognition and enforcement process for foreign arbitral awards may take longer than for domestic awards due to additional procedural requirements.
There are certain grounds on which a Vietnamese court may refuse to recognize and enforce a foreign arbitral award, such as:
- The parties to the arbitration agreement were, under the applicable law, incapable of entering into the agreement, or the agreement is not valid.
- The party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present its case.
- The award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the arbitration agreement.
- The composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or the law of the country where the arbitration took place.
- The award has not yet become binding on the parties or has been set aside or suspended by a competent authority of the country in which, or under the law of which, the award was made.
- The subject matter of the dispute is not capable of settlement by arbitration under Vietnamese law.
- The recognition or enforcement of the award would be contrary to the public policy of Vietnam.
Arbitration is an effective and flexible method of dispute resolution in Vietnam, offering parties the opportunity to resolve their disputes efficiently and confidentially. By understanding the legal framework and the arbitration process, you can make an informed decision on whether arbitration is the right choice for your dispute.
If you require assistance with arbitration or any other legal matter, our law firm is here to help. We have a team of experienced attorneys who can guide you through the arbitration process and represent your interests in the most effective manner. Please do not hesitate to contact us to discuss your needs and learn more about how we can assist you.
Note: This article is for general information purposes only and does not constitute legal advice. Each case is unique, and specific legal advice should be sought from a qualified attorney based on the individual circumstances of your matter.