In the current trend of economic globalization, Vietnamese enterprises is having more and more foreign partners to cooperate in business. However, in the process of cooperation, the parties may have commercial disputes. In such cases, the parties will usually choose to resolve the dispute by Arbitration. Depending on the provisions of the Contract, the foreign Arbitratoin could be the one to resolve the dispute. Thus, in the case of a dispute being resolved and a foreign Arbitrator has issued a award, will this award be recognized and enforced in Vietnam by the Court or not? In this article, TNTP lawyers will learn about the regulations related to the jurisdiction of courts in Vietnam to recognize and enforce foreign arbitral awards in Vietnam.
1. What is foreign arbitration?
According to the provisions of Clause 11, Article 4 of the Law on Commercial Arbitration: Foreign arbitration means an arbitration formed under a foreign law on arbitration and selected as agreed by the parties to settle a dispute outside or within the Vietnamese territory.
Thus, unlike commercial arbitration in Vietnam, foreign arbitration is established under the provisions of foreign arbitration law as agreed by the parties. Dispute settlement by foreign arbitration can be outside or within Vietnam’s territory.
2. Prescriptive periods for filing applications for recognition and enforcement of foreign arbitral awards in Vietnam
According to Article 432 of the Civil Procedure Code 2015, the time of period for recognition and enforcement of foreign arbitral awards is 03 years from the date the foreign arbitral award takes legal effect, except in cases where the applicant proves that due to force majeure or objective obstacles, the application cannot be submitted within the time limit. In that case, the time of such force majeure or objective obstacle shall not be counted in the time limit for applying.
Thus, a foreign arbitral award recognized and enforced by a Vietnamese court in Vietnam will have legal effect as a decision of a Vietnamese court. At the same time, when the court is requested to recognize a foreign arbitral award, the court is not only required to recognize the legal effect of the award, but also to ensure that the award is enforced.
3. Conditions for recognition and enforcement of foreign arbitral awards
According to Clause 1, Article 424 of the Civil Procedure Code 2015, foreign arbitral awards are considered for recognition and enforcement in Vietnam if:
• Arbitral award of a foreign country which is a signatory to an International treaty about recognition and enforcement of foreign arbitral award together with Vietnam;
• Foreign arbitral award other than those specified in point a of this clause on the basis of principle of reciprocity.
Foreign arbitral award specified in clause 1 of this Article shall be considered being recognized and enforced in Vietnam shall be the final ones of the arbitral tribunal that resolve all the contents of the dispute, finish the arbitral procedures and are effective.
Thus, it can be seen that the Court in Vietnam is not allowed to re-try a dispute that has been decided by a foreign Arbitrator, but is only allowed to carefully and thoroughly examine the foreign arbitral award, the papers and documents attached to the request as a basis for issuing a award to recognize or not recognize that award.
4. Procedures for requesting recognition and enforcement of foreign arbitration awards in Vietnam
(i) Person entitled to file a request
The award creditor or their legal representative has the right to request the Vietnamese Court to recognize and enforce in Vietnam the foreign arbitral award when:
• Individuals must reside and work in Vietnam;
• The agency or organization that must execute has its headquarters in Vietnam;
• Assets related to the enforcement of foreign arbitral awards located in Vietnam at the time of request.
(ii) Form and content of the request:
• The application for recognition and enforcement of a foreign arbitral award must be made in Vietnamese or, if made in a foreign language, must be accompanied by a notarized and legally certified Vietnamese translation.
• The request must contain the following information:
– Full names and addresses of residence places or work places of the judgment creditors or their lawful representatives; if the judgment creditors are agencies or organizations, the full names and addresses of their head-offices must be fully inscribed;
– Full names and addresses of residence places or work places of the judgments debtors; if the judgments debtors are agencies or organizations, the full names and addresses of their head-offices must be fully inscribed; in cases where the judgment debtors being individuals do not have residence places or work places in Vietnam or the judgment debtors being agencies or organizations do not have head-offices in Vietnam, their applications must also specify the addresses of the places where exist the properties and assorted properties relating to the enforcement in Vietnam of foreign courts’ civil judgments/decisions;
– Requests of judgment creditors; where foreign courts’ judgments/decisions have been partly enforced, the judgment creditors must clearly state the executed parts and the remaining parts requested for recognition and continued enforcement in Vietnam.
(iii) Attached documents
• The request must be accompanied by documents specified in the international treaty to which the Socialist Republic of Vietnam is a member; in case there is no international treaty or the international treaty does not stipulate, the request must be accompanied by the following documents:
– Originals or certified true copies of the judgment/decision issued by the foreign Court;
– Original or certified copy of the Arbitration Agreement between the parties.
• Documents and papers attached to the application in a foreign language must be accompanied by a Vietnamese translation, notarized and legally certified.
Once again, the award creditor should note that the time of period for filing a request for recognition and enforcement of a foreign arbitral award is 03 years from the date the foreign arbitral award comes into effect or due to force majeure or objective obstacles, the time of force majeure or objective obstacles will not be counted as the time limit for applying. In case the prescribed time limit has expired, the judgment creditor will not receive the application.
5. Courts in Vietnam have the authority to recognize and enforce foreign arbitral awards.
Pursuant to Clause 5, Article 31, Point c, Clause 2, Article 35, Point b, Clause 1, Article 37 and Point e, Clause 2, Article 39 of the 2015 Civil Procedure Code, the Court with jurisdiction to accept and resolve the recognition and enforcement of foreign arbitral awards in Vietnam is the Provincial People’s Court where the Vietnamese enterprise has its head office or the Provincial People’s Court where the assets related to the enforcement of foreign arbitral awards are located.
Comparing with the provisions of the Civil Procedure Code 2015 on the jurisdiction of the Court, it can be seen that the Court with the jurisdiction to accept and resolve the recognition and enforcement of foreign arbitral awards in Vietnam is the Provincial People’s Court, which is appropriate. According to the provisions of the Civil Procedure Code 2015, the Provincial People’s Court is the court with the jurisdiction to resolve disputes with foreign elements. This is also consistent with the needs and practical capabilities when compared to the District People’s Courts, the Provincial People’s Courts will have a team of staff with better professional skills and facilities, helping to ensure the recognition and enforcement of foreign arbitral awards in Vietnam in terms of both processing time and whether the content of the award is suitable for recognition and enforcement in Vietnam.
Above is the sharing of TNTP expert on “Competence of courts in Vietnam to recognize and enforce foreign arbitral awards in Vietnam”. Hopefully, this article will be helpful to readers.
Sincerely,
