THE REGULATIONS FOR FOREIGN ARBITRATIONS

What are the conditions that awards (judgments) of Foreign Arbitration have to demand to be enforced in Vietnam? What are the processes and procedures for recognizing and enforcing foreign arbitration awards in Vietnam? How can Vietnamese Law ensure the processes for enforcing such awards? NPLaw will support issues related to a Foreign Arbitration through the following article.

I. Understanding for a Foreign Arbitration

1. What is a Foreign Arbitration?

Foreign Arbitration means an Arbitration is established according to a foreign Law on Arbitration that the parties choose to resolve disputes beyond or in Vietnam territory. 

2. Legal basic

• The Code of Civil Procedure 2015;
• The Law on Commercial Arbitration 2010.

II. Regulations for the Foreign Arbitration

1. What are the conditions that a Foreign Arbitration Institution has to demand to operate in Vietnam?

Pursuant to Article 73 of the Law on Commercial Arbitration 2010 stipulating conditions that a Foreign Arbitration Institution has to demand to be entitled to operate in Vietnam, the Foreign Arbitration Institution has to satisfy the following two (02) conditions to be entitled to operate in Vietnam: 

•  The Foreign Arbitration Institution was established and is legally operating abroad in the current;
•  The Foreign Arbitration Institution has to present respect for the Constitution and Laws of the Socialist Republic of Vietnam.

2. How does Vietnamese Law stipulate foreign arbitration awards⁽¹⁾? and What is unsatisfactory?

 Pursuant to the Law on Commercial Arbitration 2010, Foreign Arbitration Institutions will be operated in Vietnam according to the following two (02) methods:

• Branches of Foreign Arbitration Institutions: Branches are dependent units of the Foreign Arbitration Institution. These branches will be established and operated in Vietnam according to the Law on Commercial Arbitration 2010. The Foreign Arbitration Institution and its branches will be responsible for the activities of branches under Vietnamese Law. A branch Manager established and operated in Vietnam who is appointed by the Foreign Arbitration Institution and is also an authorized legal representative of the Foreign Arbitration Institution in Vietnam. 
• Headquarters of Foreign Arbitration Institutions are also dependent units of the Foreign Arbitration Institution. However, headquarters don’t perform professional activities like the Foreign Arbitration Institution or its branches, such headquarters are only established to seek and promote operating opportunities in Vietnam according to the Law on Commercial Arbitration 2010. Headquarters will not be responsible for its activities under Vietnamese Law that belong to the competence of the Foreign Arbitration Institution.

III. Some questions and answers regarding Foreign Arbitration

1. What units does the Foreign Arbitration Institution in Vietnam have?

Branches and headquarters of the Foreign Arbitration Institution are dependent units of the Foreign Arbitration Institution, but branches have scopes of operation more extensive than headquarters. Branches will provide and perform services such as arbitration, mediation, and other activities of dispute resolution in Vietnam. While headquarters are only established to seek and promote operating opportunities in Vietnam. 

2. Are foreign arbitration awards recognized and enforced in Vietnam?

Pursuant to Clause 2, Article 424 of the Code of Civil Procedure 2015, foreign arbitration awards that are recognized and enforced in Vietnam are final awards of the Arbitration Tribunal to resolve the entire dispute's contents, terminate the arbitral proceedings, and have validity.

3. How are foreign arbitration awards enforced in Vietnam?

Foreign arbitration awards will be enforced like decisions of a local Court, and the Judiciary⁽²⁾ of the State can apply coercive measures to enforce such decisions. 

4. Cases that foreign arbitration awards are recognized and enforced in Vietnam

• Pursuant to Clause 10, Article 3 of the Law on Commercial Arbitration 2010, arbitration awards (arbitral awards) mean decisions of the Arbitration Tribunal (arbitral forum) that resolve the entire dispute's contents and terminate the arbitral proceedings;  and according to Clause 2, Article 424 of the Code of Civil Procedure 2015, awards (judgments) of a foreign arbitration as defined by Clause 1 of this Article that are recognized and enforced in Vietnam are final awards of the Arbitration Tribunal to resolve the entire dispute's contents, terminate the arbitral proceedings, and have validity.
• Foreign arbitration awards that are recognized and enforced in Vietnam by the Vietnamese Court have the same legal validity as decisions of the Vietnamese Court.

These are all information relating to REGULATIONS FOR THE FOREIGN ARBITRATIONS as prescribed by Vietnamese Law. Please don’t hesitate to contact us, if the clients have any further questions.

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1. Arbitration award: (also known as an arbitral award) means a decision of the Arbitration Tribunal that resolves the entire dispute's contents and terminates the arbitral proceedings.    (source: Legal English of NPLaw)

2. Judiciary: the part of a country’s government that is responsible for its legal system and which consists of all the judges in the country’s courts of Law. (source: Cambridge Dictionary)