Author: TNTP LAW

Sale of goods Contract - Basic contents you need to know

Sales of goods contract – Basic Contents You Need To Know

Written by TNTP LAW on 23 November, 2023. Posted in Contract Law.

When entering into a sale of goods contract, there are some important provisions to be aware of in order to minimize risks. Therefore, the parties participated in the contract need to understand the basic contents to propose to their business partner during the contract negotiation process. In the following article, TNTP will analyze some basic contents you need to know about this type of contract.

I. Definition of the sale of goods contract

The current legal documents in Vietnam do not have a definition of the sale of goods contract, but based on the definition of a contract (Article 385 of the Civil Code 2015), sale of asset contract (Article 430 of the Civil Code 2015), and the definition of sale and purchase of goods (Clause 8 Article 3 of the Commercial Law 2005), we can provide the following definition of the sale of goods contract as follow:

The sale of goods contract is an agreement between the parties, whereby the seller has the obligation to deliver the goods, transfer ownership rights of the goods to the buyer, and receive payment; the buyer has the obligation to make payment to the seller, receive the goods and ownership rights of the goods as agreed.

Depending on the subject, object, place of establishment and performance of the contract, the sale of goods contract is divided into domestic sale of goods contract and international sale of goods contract.

II. Form of the sale of goods contract

According to Article 24 of the Commercial Law 2005, the form of the contract can be expressed orally, in writing, or established by specific behavior. Contracts sale of goods that are required by law to be in writing by the law must comply with those provisions.

In principle, the parties are free to choose the form of the contract, except in cases where the law stipulates a specific contract form.

For example, the international sale of goods contract must be performed based on a written contract or another form with equivalent legal value (Clause 2 Article 27 of the Commercial Law 2005). The form with equivalent legal value includes electronic message, telex, fax, data message, and other forms as prescribed by law (Clause 15 Article 3 of the Commercial Law 2005).

III. Basic contents required in the sale of goods contract

During the drafting and review process to prepare for the signing of the sale of goods contract, the parties need to ensure that the contract includes the following basic contents:

– The information of the parties participated in the sale of goods contract;
– The subject of the contract;
– The price of the goods;
– Terms of payment;
– Terms of delivery;
– Right and obligation of the parties;
– Warranty of the goods;
– Commitment and guarantee;
– Force majeure events;
– Exemption from liability cases;
– Duration of the contract;
– Applicable remedies;
– Termination of the contract;
– Applicable law and dispute resolution.

The above is the content of the article ” Sale of Goods Contract – Basic Contents That Need To Know”. If you have any issues that need clarification, don’t hesitate to get in touch with TNTP for the best support.

Sincerely,

Vacation ownership contract risks to customers when entering into the “vacation ownership contract”

Written by TNTP LAW on 22 November, 2023. Posted in Contract Law.

Vacation is a precious time that many people look forward to relaxing, discovering, and enjoying life. Currently, there are many forms of tourism and resort formed to serve the needs of everyone. One of them appears in the form of customers entering into the “Vacation Ownership Contracts” with companies or resorts – A form of resort that is quite new to Vietnamese people. However, in addition to the benefits that the Vacation Ownership Contract may bring, the Customer may face many risks from this Contract. In this article, we will give an overview of the Vacation Ownership Contract and analyze the risks that Customers may face.

1. Overview of Vacation Ownership Contract

In the provisions of Vietnamese law, there are currently no specific provisions for “Vacation Ownership Contract”. However, one can be understand that a “Vacation Ownership Contract” is a type of contract where the buyer buys the right to use a specific resort location for a fixed period of time, usually annually. This is a form of vacation investment and is often used to secure ownership of vacations in popular resort locations at domestically and internationally.

Vacation Ownership Contracts usually come with specific terms and conditions, including periods of use, maintenance fees, and the rights and responsibilities of the buyer. Under the Contract Contract, the buyer may transfer or resell their ownership in this Vacation Ownership Contract to someone else.

2. Risks to the Customers

The Trade Remedies Authority of Vietnam (Ministry of Industry and Trade) said that over the past time, disputes, reflections and complaints related to the Vacation Ownership Contract have continued to be reported by the media as well as consumers to the consumer rights protection agency.

A Vacation Ownership Contract is essentially a service registration contract, based on Case Law No. 42/2021/AL which makes it very clear that this is a form of accommodation service contract. Therefore, owning a vacation is not the same as owning real estate, or property there, but what the buyer owns is the time and service enjoyed in the future, not in the present. So it has a lot of potential risks for buyers. As follows:

• First, in fact, the term of Vacation Ownership Contracts is often quite long, which means that the buyer has to pay large amounts of money to own, it is possible that at the time of entering into the Contract, the project of the resort under the Contract has not been completed. Therefore, it is necessary to carefully evaluate the risks and profit margins before entering into the Contract.

• Second, in addition to the risk of external factors, such as the salesperson pressuring to sign the contract, the seller also uses untrue forms of advertising. The risk that future performance of the Contract may be “delayed” or even “broken” if the vacation seller fails to complete the Project on time or, worse, the Project “dies”.

• Third, in addition to the one-time payment at the time of signing the contract, the Customer must also pay annual expenses (from several million to several tens of millions of VND) depending on the specific rights and utilities that the Customer wants to enjoy when using the service at the resort. However, in the Contract there may not be specific and clear provisions about these expenses and related issues.

• Fourth, many people consider Vacation Ownership Contracts as a profitable investment channel. However, during the Contract, there are many buyers who want to resell or terminate the Vacation Ownership Contract for many reasons such as the vacation seller does not comply with the Contract, promises, the resort project is not completed on schedule to participate in the service, detecting signs of deceiving customers, mobilizing capital to build resorts by entering into vacation ownership contracts, … Many Customers after paying a lot of money to the vacation seller and receive the Contract after payment. At this point, the Customer can carefully read the Contract and realize that there are many unfavorable terms for vacation buyers. Therefore, if the Customer considers this as a profitable investment channel and wants to sell/re-transfer the Vacation Ownership Contract, the Customer will face difficulties because the terms of sale or transfer are very unfavorable, even in cases stipulating that the Customer must have the approval of the vacation seller to proceed with the transfer. Customers who have purchased vacations often have difficulty exiting this agreement.

• Fifth, the current Vietnamese law also does not have specific legal provisions to regulate the subject of “Vacation Ownership Contract” and the fact that investors through the sale of vacations to raise capital from entering into contracts with customers, has created a large legal gap. Businesses use a strong legal team, using a pre-written contract (Sample Contract) that stipulates terms that are favorable to them and disadvantageous to customers, especially for those who are not knowledgeable about the law.

3. Minimizing risks when entering into Contracts

• Before entering into the Vacation Ownership Contract in particular and the types of Contracts in general, the Customer should carefully study information about the subject of the Contract which products or services are introduced in the event, as well as about the supplier. In this way, it is possible to identify important issues of benefits and risks that may be encountered, thereby having the opportunity to decide and ask for further answers before signing the contract.

• For the Vacation Ownership Contract, the Customer should carefully read and understand all the terms and conditions in the Contract, pay special attention to the fees and durations, rights and obligations of the Customer, the value of the Contract and related costs, as well as the terms of termination/assignment of the Contract and handling of breach of the Contract. Clients can use legal aid services from a legal service provider to advise on entering into this type of Contract.

• In addition, Customers can report and denounce to the police agencies organizations, businesses and individuals that take advantage of the activity of “Owning vacations” to commit illegal acts.

Above is the article “Risks to Customers when entering into “Vacation Ownership Contract” that TNTP sent to readers. In case there is a problem to discuss, please contact TNTP for answers.

Best regards,

Jurisdiction of the court to resolve commercial contract disputes

Written by TNTP LAW on 21 November, 2023. Posted in Dispute Settlement.

When a commercial contract gives rise to a dispute, if the parties have agreed on a dispute resolution authority, that authority’s jurisdiction takes priority as per the agreement. In the absence of an agreement and when the parties cannot reconcile on their own, the dispute is resolved in a court with jurisdiction. In such cases, the plaintiff needs to understand the legal provisions to file the lawsuit in the appropriate jurisdiction. In this article, TNTP will provide readers with legal knowledge about “Jurisdiction of the Court to Resolve Commercial Contract Disputes.”

1. What is a commercial contract dispute?

Currently, there is no legal definition of a commercial contract dispute. To understand the definition of commercial contract dispute, we need to understand two related concepts: contract dispute and commercial dispute.

• A contract dispute refers to conflicts and disagreements among parties in a contractual relationship, primarily arising from the non-performance or improper performance of rights and obligations specified in the contract.

• Based on Article 3.1 of the 2005 Commercial Law, commercial activities are defined as profit-seeking activities, including the sale of goods, provision of services, investment, commercial promotion, and other profit-seeking activities.

A commercial dispute can be understood as conflicts and disputes related to rights and obligations between entities engaged in commercial activities.

Therefore, based on the above-mentioned concepts of contract dispute and commercial dispute, a commercial contract dispute can be understood as conflicts and disagreements that arise between entities regarding non-performance or improper performance of obligations committed in a commercial contract, directly affecting the legitimate interests of the other party.

2. Jurisdiction to resolve commercial contract disputes in court

The jurisdiction to resolve contract disputes by the court is determined as follows:

• Determining the jurisdiction of the Court based on the specific case

Determining the jurisdiction of the court based on the specific case means determining whether the dispute falls within the jurisdiction of the court. The 2015 Code of Civil Procedure (“CCP 2015”) specifically regulates the jurisdiction to resolve disputes by the court from Article 26 to Article 34. Accordingly, disputes related to business and commercial matters fall within the jurisdiction of the court, as specifically defined in Article 30 of the CCP 2015, including disputes arising from commercial contracts.

Therefore, disputes arising from commercial contracts will fall within the jurisdiction of the court, except in cases where the parties have agreed on a different dispute resolution authority.

• Determining the jurisdiction of the Court based on the level of adjudication

Based on the provision in point b, Clause 1 of Article 35 of the CPC 2015, District-level Courts have jurisdiction to settle commercial disputes as specified in Clause 1 of Article 30 of the CPC 2015. Therefore, District-level Courts have jurisdiction to settle commercial contract disputes between individuals and enterprises or between enterprises with profit-seeking purposes.

However, for other types of commercial contract disputes and disputes arising from the sale and purchase of assets involving parties or assets abroad, or cases that require legal representation by the representative agency of the Socialist Republic of Vietnam abroad, the jurisdiction does not lie with the district-level people’s courts but with the Provincial-level Courts (based on point c, Clause 1 of Article 37 of the CPC 2015).

Based on the above-mentioned provisions, it can be seen that disputes arising from commercial contracts will fall under the jurisdiction of the District-level Courts, except for disputes arising from the sale and purchase of assets involving parties or assets abroad or cases that require legal representation by the representative agency of the Socialist Republic of Vietnam abroad, which fall under the jurisdiction of the Provincial-level people’s Courts.

• Determining the jurisdiction of the Court based on the territory

The jurisdiction of the court to settle disputes arising from commercial contracts based on the territory is determined as follows: The court where the defendant resides or works if the defendant is an individual, or the court where the defendant has its headquarters if the defendant is an entity or organization.

For disputes within commercial contracts, the parties have the right to mutually agree in writing to request the court where the plaintiff resides or works if the plaintiff is an individual, or the court where the plaintiff has its headquarters if the plaintiff is an entity or organization.

Note: If a civil case has been accepted and is being resolved by a court according to the territorial jurisdiction as stipulated in the CPC 2015, then that court must continue to handle the case even if there are changes in the residence, headquarters, or address for conducting transactions of the parties during the resolution process.

• Determining the jurisdiction of the Court based on the choice of the plaintiff

The plaintiff has the right to choose the court to resolve commercial contract disputes in certain cases as stipulated in Clause 1 of Article 40 of the CPC 2015, specifically:

 If the plaintiff does not know the residence, workplace, or headquarters of the defendant, the plaintiff may request the Court where the defendant is last known to reside, work, or have its headquarters, or where the defendant has assets to be settled.

 If the dispute arises from the activities of a branch organization, the plaintiff may request the court where the organization’s headquarters or where the organization’s branch is located to settle the dispute.

 If the defendant does not have a residence, workplace, or headquarters in Vietnam, the plaintiff may request the court where the plaintiff resides, works, or has its headquarters to settle the dispute.

 If the dispute relates to compensation for non-contractual damages, the plaintiff may request the court where the plaintiff resides, works, has its headquarters, or where the damage-causing event occurred to settle the dispute.

 If the dispute arises from a contractual relationship, the plaintiff may request the court where the contract is performed to settle the dispute.

 If the defendants have residences, workplaces, or headquarters in multiple different places, the plaintiff may request the court where one of the defendants resides, works, or has its headquarters to settle the dispute.

Based on the above content, the jurisdiction of the court to resolve commercial contract disputes can be determined based on the plaintiff’s request in certain cases as prescribed by law.

The above is the content and legal sharing of TNTP regarding the jurisdiction of the Court to resolve commercial contract disputes. We hope this article is useful to you.

Best regards,

Rights and Obligations of the Mortgagee in Property Mortgage

Written by TNTP LAW on 16 November, 2023. Posted in Contract Law.

To ensure the performance of obligations in a contract, one of the measures often chosen by parties is Property Mortgage. Property Mortgage has common characteristics with other methods of securing obligations, such as enhancing the responsibilities of the parties regarding their commitments and supplementary obligations. To help parties apply this measure in accordance with legal regulations, in this article, TNTP will present an important aspect that all parties should pay attention to: the Rights and Obligations of the Mortgagee in Property Mortgage.

1. Rights of the Mortgagee

The mortgagee in Property Mortgage has the following rights:

• Examine and inspect directly the mortgaged property provided that such examination and inspection does not hinder or cause difficulty to the use and exploitation of the mortgaged property.

• Require the mortgagor to provide information on the current status of the mortgaged property.

• Require the mortgagor to apply necessary measures to preserve the property and the value of the property if there is a danger that use and exploitation of the mortgaged property will cause loss of value or depreciation in the value of the property.

• Conduct the registration of mortgage as prescribed by law.

Registering the mortgage in accordance with legal regulations is the obligation of the mortgagee if the mortgage measure falls under the cases mandated by the law to be registered as a secured transaction. On the other hand, registering the mortgage is also the right of the mortgagee because only when the mortgage is registered as per legal regulations does it gain enforceability against third parties. From that point onward, the mortgagee has the right to claim the mortgaged property from the possessor and is entitled to establish the priority order for payment when handling the mortgaged property.

• Require the mortgagor or a third person holding the mortgaged property to deliver it to the mortgagee for realization if, upon expiry of the term for the fulfilment of the obligation, the obligor has failed to perform or performed incorrectly the obligation.

• Hold documents related to mortgaged property as agreed by parties, unless otherwise prescribed by law.

• Follow procedures for realization of a mortgaged property as prescribed in the cases: i) An obligator fails to perform or perform not as agreed an obligation when it falls due; ii) An obligator must perform the secured obligation before the time limit due to his/her violation against the obligation as agreed or prescribed by law; iii) Other cases as agreed by the parties or prescribed by law.

2. Obligations of the Mortgagee

The mortgagee has the following obligations:

• Return the documents to the mortgagee after the termination of the mortgage in cases where the parties have an agreement, except when the law specifies otherwise.

Although the law only stipulates that a mortgage is the “use of property” and does not require the mortgagor to transfer documents related to the mortgaged property, in practice, the mortgagee often requests the mortgagor to transfer such documents regarding the mortgaged property. This transfer of documents helps the mortgagee prevent the mortgagor from transferring ownership rights to the mortgaged property. In cases where the mortgagee holds documents related to the mortgaged property, the mortgagee has an obligation to return these documents to the mortgagor when the mortgage is terminated.

• Follow procedures for the realization of mortgaged property in accordance with regulations of law.

Realization of mortgaged property is both a right and an obligation of the mortgagee. However, when carrying out this process, the mortgagee must comply with the procedures and regulations prescribed by the law.

This article, “Rights and Obligations of the Mortgagee in Property Mortgage” is provided by TNTP for your reference. If you have any questions or need further clarification, please feel free to contact TNTP for timely assistance.

Sincerely,

Rights and Obligations of the Mortgagor in Property Mortgage

Written by TNTP LAW on 15 November, 2023. Posted in Contract Law.

Property mortgage involves one party using their own property to secure the performance of obligations without transferring the property to the other party. When implementing Property mortgage measures, one of the critical aspects that all parties involved need to pay attention to is the rights and obligations of the Mortgagor. In this article, TNTP will provide information about the Rights and Obligations of the Mortgagor in Property mortgages.

1. Rights of the Mortgagor

The Mortgagor in asset mortgages has the following rights:

• Exploit, and enjoy the yield and income derived from, the property, except where the yield and income also form part of the mortgaged property as agreed.

• Invest in order to increase the value of the mortgaged property.

• Recover the mortgaged property and related documents held by a third person when the obligation secured by the mortgage is terminated or is substituted by other security.

• Sell, replace, or exchange the mortgaged property, if it is goods circulating in the process of production or business. In this case, the right to demand payment from the buyer, the amount received, property formed from the amount received, or the property replaced or exchanged becomes part of the mortgaged property.

When a warehouse is mortgaged, the mortgagor may substitute goods in the warehouse but must ensure the value of the goods in the warehouse remains the value agreed.

• Sell, exchange or give mortgaged property not being goods rotating during the production and business process with the consent of the mortgagee or as prescribed by law.

• Lease or lend the mortgaged property provided that notice must be provided to the lessee and the borrower that the property is being mortgaged and that the mortgagee must also be notified that such notice has been provided.

2. Obligations of mortgagor

The mortgagor in property mortgages has the following obligations:

• Transfer documents related to the mortgaged property, unless otherwise agreed or prescribed by law.

• Take care of and preserve the mortgaged property.

• If the mortgaged property is in danger of losing its value or depreciating in value due to its exploitation, to take necessary remedial measures, including ceasing the exploitation of the mortgaged property.

• When the mortgaged property is damaged, the mortgagor is obligated to, within a reasonable period, repair or substitute another property with equivalent value, unless otherwise agreed.

• Provide information about the actual condition of the mortgaged property to the mortgagee.

• Deliver the mortgaged property to the mortgagee for realization in one of the cases prescribed in the cases: i) An obligator fails to perform or perform not as agreed an obligation when it falls due; ii) An obligator must perform the secured obligation before time limit due to his/her violation against the obligation as agreed or prescribed by law; iii) Other cases as agreed by the parties or prescribed by law.

• Notify the mortgagee of any third-person rights with respect to the mortgaged property (if any). In the case of failure to provide such notice, the mortgagee shall have the right to cancel the contract of mortgage of property and demand compensation for damage or the right to maintain the contract and agree on the rights of the third person with respect to the mortgaged property.

• Do not sell, exchange or give the mortgaged property, except in the cases:

i) In cases where the mortgaged property is goods circulating in the process of production or business, the mortgagor is allowed to sell, replace, or exchange this property. In the case of mortgaged goods, the mortgagor has the right to replace the goods in the warehouse but must ensure the value of the goods in the warehouse as agreed.

ii) In cases where the mortgaged property is not goods circulating in the process of production or business, the mortgagor can only sell, exchange, or donate this property if agreed upon by the mortgagor or as stipulated by the law.

This article, “Rights and Obligations of the Mortgagor in Property Mortgage” is provided by TNTP for your reference. If you have any questions or need further clarification, please feel free to contact TNTP for timely assistance.

Sincerely,

Mortgage of property – Basic content you need to know

Written by TNTP LAW on 14 November, 2023. Posted in Contract Law.

Currently, the need for borrowing money has become essential in daily life and business activities. To mitigate the risks that may arise from loan transactions, a Mortgage of property is considered one of the effective legal tools commonly applied by the parties involved. Therefore, when applying the mortgage of property measure, parties should proactively study the legal regulations regarding this measure. In this article, TNTP will present some basic information about mortgage of property.

1. What is a Mortgage of property?

Mortgage of property means the use by one party (hereinafter referred to as the mortgagor) of property under the ownership of the obligor as security for the performance of an obligation to the other party (hereinafter referred to as the mortgagee) without transferring such property to the mortgagee.

The mortgagor shall hold the mortgaged property. The parties may agree to deliver the mortgaged property to a third person to hold.

2. Mortgaged property

Mortgaged properties are the properties or rights chosen by the parties to secure the rights of the mortgagee when there is a breach of the secured obligations. Mortgaged properties include both real and movable properties. These properties can be existing or future assets. Mortgaged properties must meet all the conditions specified by law, such as being owned by the mortgagor, being identifiable, and being transferable in civil transactions. Parties should take note of the following:

• In cases where the entire or part of the real or movable property has accessory objects, those accessory objects are also considered part of the mortgaged property unless otherwise agreed.

• Concerning mortgage on land use rights that the mortgagor owns property on land, such property shall also be part of the mortgaged property, unless otherwise agreed.

• Where mortgaged property is insured, the mortgagee must notify the insurer that the insured property is being mortgaged. The insurer shall pay the insured sum directly to the mortgagee upon the occurrence of an insured event. If the mortgagee failed to notify the insurer that the insured property was mortgaged, the insurer shall pay the insured sum in accordance with the insurance contract and the mortgagor shall be obliged to make payment to the mortgagee.

3. Effectiveness of mortgage of property

The effectiveness of a mortgage of property includes the effectiveness in binding the rights and obligations of the parties in the mortgage relationship and the effectiveness against third parties.

A mortgage of property contract becomes effective from the moment it is concluded unless otherwise agreed or specified by law. Therefore, a mortgage of property contract can become effective at one of three points in time: the statutory point, the agreed point, or the point of conclusion. The priority order is determined in decreasing order as follows: the statutory point, the agreed point, and the point of conclusion.

The statutory point can be understood as when the law has regulations on registering, notarizing, authenticating, etc., for a mortgage of property. According to Land law, unless it is related to real estate business, a mortgage contract for land use rights, land use rights and properties attached to land must be notarized or authenticated (Article 167, Land Law 2013).

Mortgage of property becomes effective against third parties from the moment they are registered. When the mortgage of property becomes effective against third parties, it gives the mortgagee the right to demand the mortgaged property before anyone else, even if someone else has possession of it.

4. Termination of property mortgage

A mortgage of property shall terminate in any of the following cases:

• The obligation which is secured by the mortgage has terminated.

• The mortgage of the property has been cancelled or substituted with another security.

• The mortgaged property has been realized.

• As agreed by the parties.

This article, “Mortgage of property – Basic content you need to know” is provided by TNTP for your reference. If you have any questions or need further clarification, please feel free to contact TNTP for timely assistance.

Sincerely,

INTECH PARTNER DAY 2023 program with the motto: CONNECTION – COOPERATION – DEVELOPMENT

Written by TNTP LAW on 13 November, 2023. Posted in Hoạt động của TNTP.

On October 27, 2023 at the INTECH Group Business Hub Building, the branch of TNTP & Associates International Law Firm (” TNTP “) participated in the INTECH PARTNER DAY 2023 Program – A program organized by INTECH Group to create opportunities to exchange, connect and tighten cooperation between INTECH Group and partners; as well as connecting partners of INTECH Group together to share opportunities, cooperate, develop sustainably and reach out.

INTECH Group was established in 2012, is a unit specializing in providing comprehensive solutions for factory and cleanroom, with strengths in consulting, design, construction, maintenance and being a distribution representative, partner with reputable manufacturers in the world.

During its operation, INTECH Group has achieved a number of outstanding achievements as follows:

– Top 100 in FAST500 Fastest Growing Enterprises in Vietnam in 2022.
– In 2022, surpassing the strict standards of the NEBB US, INTECH Group has mastered cleanroom technology and reached the world’s highest cleanliness level Class 1 according to ISO 14644 standards, this achievement was voted as one of 10 Vietnamese science and technology events in 2022.
– In 2023, INTECH Group was recognized as a pioneer enterprise in the field of cleanroom approved by the Ministry of Planning and Investment and the United States Agency for International Development – USAID IPSC Project.

Let’s take a look at the activities of INTECH Partner Day 2023 took place on October 27, 2023:

– Conference: Exchange and share about the topic “Restructuring for sustainable development”;
– Introduction to visiting exhibition and networking exchange;
– Gala Dinner: Connection – Cooperation – Development.

In the current development trend, cooperation is one of the effective ways to help develop business activities of enterprises. Besides expanding the access to new customers, building business partnerships also help enterprises provide more value to their existing customers.

Not just a simple strategic relationship, business partnership also helps enterprises create a sustainable symbiotic development ecosystem, develop in vision instead of going alone in the business process. Most business cooperation relationships bring many benefits to enterprises and are suitable for all kinds of enterprises, scales and operating models. It is important that enterprises and partners actively cooperate and always build and nurture for the development relationships, with the aim to create “win-win” value for both sides.

With the participation from INTECH Group’s partners network, including customers, strategic suppliers, associations, business clubs, training and human resource development organizations, as well as enterprise support organizations, the program is a great opportunity for TNTP to connect, learn and create new cooperation opportunities.

Through learning and sharing, TNTP in particular and enterprises in general can shape a future of mutual development, prosperity, and contribute to the community and society in a positive way.

TNTP sincerely thanks for the meaningful and practical value of the program and hopes that INTECH Group will continue to organize helpful programs in the future.

Best regards,

Deposit – Basic content you need to know

Written by TNTP LAW on 8 November, 2023. Posted in Legal newsletter.

Deposit is a long-standing civil remedy in various civil transactions. The deposit method plays a role in enhancing the awareness of fulfilling the obligations of parties in civil contracts. Simultaneously, it is an effective legal tool to protect the rights and interests of parties when the obligations in the main contract are violated. To gain a better understanding of the deposit method, readers can follow this article by TNTP.

1. Definition of Deposit

Deposit is an act whereby one party (hereinafter referred to as the Depositor) transfers to another party (hereinafter referred to as the Depositary) a sum of money or precious metals, gemstones or other valuable things (hereinafter referred to as the deposited property) for a period of time as security for the entering into or performance of a contract.

Deposits are formed through the agreement of the parties when they intend to establish a contract (the deposit agreement is formed before the contract is concluded) or when they aim to secure the performance of obligations in an already established contract. Accordingly, one party will transfer assets to the other, specifically money, precious metals, gemstones, or other valuable assets, to ensure the conclusion or to secure the performance of the contract. Deposited assets serve the dual function of securing the performance of obligations and being used for payment if the transaction is carried out as intended by the parties.

Note: In cases where one party in the contract transfers a sum of money without specifying whether it is a deposit or an advance payment, this amount is considered an advance payment.

2. Forms of Deposit

The Civil Code 2015 (“CC 2015”) does not specifically stipulate the form of deposits. Therefore, parties can agree on deposits verbally, in writing, etc. However, to fully express and clarify the contents of the deposit, as well as to limit risks and protect the legal rights of parties in case of disputes, it is advisable to document the deposit.

A deposit agreement can be expressed through a separate document or as a clause in the main contract. In the case of a deposit to conclude a contract, the deposit must be documented separately because, at the time of concluding the deposit agreement, the contract has not yet been formed.

3. Rights and Obligations of the Depositor

The Depositor has the following rights and obligations:

• Request the Depositary to cease exploitation, use, or the establishment of civil transactions regarding the deposited assets; carry out preservation and maintenance to prevent the depreciation or loss of value of the deposited assets;

• Exchange, replace the deposited assets, or use the deposited assets in other civil transactions with the consent of the Depositary;

• Pay the Depositary reasonable expenses for the preservation and maintenance of the deposited assets. Reasonable expenses are understood as the actual, necessary, and legally acceptable expenses at the time of expenditure that the Depositary must pay to ensure the preservation of the deposited assets without loss, damage, or deterioration;

• Register ownership rights to the assets or perform other obligations as stipulated by the law to ensure that the Depositary becomes the owner of the deposited assets in case the Depositor violates the commitment to conclude or perform the contract;

• Other rights and obligations as agreed upon or as stipulated by CC 2015 and related laws.

4. Rights and Obligations of the Depositary

The Depositary has the following rights and obligations:

• Demand that the Depositor cease exchanging, replacing, or establishing other civil transactions regarding the deposited assets without the consent of the Depositary;

• Take ownership of the deposited assets in case the Depositor violates the commitment to conclude or perform the contract;

• Preserve and maintain the deposited assets;

• Refrain from establishing civil transactions, exploiting, or using the deposited assets without the consent of the Depositor;

• Other rights and obligations as agreed upon or as stipulated by CC 2015 and related laws.

5. Handling of Deposited Assets

The handling of deposited assets is carried out as follows: If the contract is concluded and executed, the deposited assets are returned to the Depositor or used to fulfil the monetary obligation. If the Depositor refuses to conclude the contract or perform it, the deposited assets belong to the Depositary, and the Depositary must return the deposited assets and an amount equivalent to the value of the deposited assets, except in cases with different agreements.

This article “Deposit – Basic content you need to know ” is provided by TNTP for your reference. If you have any issues or questions, please contact TNTP for timely assistance.

Sincerely,

Pledge of property – Basic content you need to know

Written by TNTP LAW on 7 November, 2023. Posted in Legal newsletter.

In Vietnam, the law stipulates nine measures for securing obligations. Among them, a prevalent measure employed by parties to ensure the performance of obligations is the Pledge of property. To ensure that this measure is applied correctly according to legal regulations and protects the rights and interests of all parties involved, this article will present the fundamental information about the Pledge of property that all parties should be aware of.

1. What is Pledge of property?

Pledge of property means the delivery by one party (hereinafter referred to as the pledgor) of property under its ownership to another party (hereinafter referred to as the pledgee) as security for the performance of an obligation.

2. Effectiveness of Pledge of property

• Agreement on pledge of property shall take effect from the time of concluding unless otherwise agreed or prescribed by law.

• Pledge of property shall take effect against a third party from the time at which the pledgee keeps the pledged property.

• In the case of real estate being the subject of the pledge, the pledge of real estate becomes effective against third parties from the moment of registration, as stipulated by the law.

3. Obligations of the pledgor

• Transfer the pledged property to the pledgee in accordance with the agreement. The pledgor may deliver the pledged property to the pledgee or a third party for safekeeping, depending on the agreement between the parties. The pledgee may keep the pledged property at the location of the property or a location of their choosing.

• Inform the pledgee of any rights of third parties regarding the pledged property, if any; failure to do so gives the pledgee the right to terminate the pledge of property contract and seek compensation for damages or uphold the contract and accept the rights of third parties regarding the pledged property.

• Pay the pledgee reasonable expenses for preserving the pledged property, unless otherwise agreed upon.

4. Rights of the pledgor

• Request the pledgee to cease the use of the pledged property if the pledgee is leasing, lending, or utilizing the pledged property in a manner that could reduce their value.

• Request the pledgee to return the pledged property and related documents, if any, when the obligation secured by the pledge is terminated.

• Request compensation for any damages incurred regarding the pledged property.

• Sell, replace, exchange, or give the pledged property with the consent of the pledgee or as provided by the law.

5. Obligations of the Pledgee

• Take care of and preserve the pledged property; if the pledgee loses or damages the pledged property, the pledgee must compensate the pledgor for the damage.

• Do not sell, exchange, give or use the pledged property as security for the performance of another obligation.

• Do not lease, lend, or exploit the yield or income derived from, the pledged property, unless otherwise agreed.

• Return the pledged property and related documents upon fulfilment of the secured obligation or where the pledge is substituted with another security.

6. Rights of the Pledgee

• Demand that any party unlawfully possessing or using the pledged property return them.

• Manage the pledged property according to the agreed-upon method or as stipulated by the law.

• Lease, lend, utilize, derive benefits, or profit from the pledged property if agreed upon.

• Receive reasonable expenses for preserving the pledged property when returning it to the pledgor.

7. Termination of Pledge of Property

The pledge of property terminates in the following cases:

• When the obligation is secured by terminating the pledge of property.

• When the pledge of property is cancelled or replaced by other security measures.

• When the pledged property has been disposed of.

• By agreement of the parties.

8. Return of Pledged Property

When the pledge of property terminates due to the aforementioned reasons: termination of the secured obligation, cancellation of the pledge of property, replacement by other security measures, or by agreement of the parties, the pledged property and documents evidencing the ownership rights concerning the property shall be returned to the pledgor. Any yield and income derived from the pledged property shall also be returned to the pledgor unless otherwise agreed.

The above information covers the basic aspects that all parties should be familiar with when implementing the measure of the Pledge of property. If you have any issues or questions, please contact TNTP for timely assistance.

Sincerely,

Author: TNTP LAW

Sales of goods contract – Basic Contents You Need To Know

I. Definition of the sale of goods contract

II. Form of the sale of goods contract

III. Basic contents required in the sale of goods contract

Vacation ownership contract risks to customers when entering into the “vacation ownership contract”

1. Overview of Vacation Ownership Contract

2. Risks to the Customers

3. Minimizing risks when entering into Contracts

Jurisdiction of the court to resolve commercial contract disputes

1. What is a commercial contract dispute?

2. Jurisdiction to resolve commercial contract disputes in court

Rights and Obligations of the Mortgagee in Property Mortgage

1. Rights of the Mortgagee

2. Obligations of the Mortgagee

Rights and Obligations of the Mortgagor in Property Mortgage

1. Rights of the Mortgagor

2. Obligations of mortgagor

Mortgage of property – Basic content you need to know

1. What is a Mortgage of property?

2. Mortgaged property

3. Effectiveness of mortgage of property

4. Termination of property mortgage

INTECH PARTNER DAY 2023 program with the motto: CONNECTION – COOPERATION – DEVELOPMENT

TNTP & ASSOCIATES INTERNATIONAL LAW FIRM

More about TNTP