© Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com i ORDINANCE ON COMMERCIAL ARBITRATION DATED 25 FEBRUARY 2003 TABLE OF CONTENTS CHAPTER I 1 GENERAL PROVISIONS 1 Article 1 Governing scope 1 Article 2 Interpretation of terms 1 Article 3 Principles for dispute resolution by arbitration 2 Article 4 Form of dispute resolution by arbitration 2 Article 5 Competence to resolve a dispute in cases where there is an arbitration agreement 2 Article 6 Effect of an arbitral award 2 Article 7 Principle of application of law to dispute resolution 2 Article 8 Applicability of international treaties 3 CHAPTER II 3 ARBITRATION AGREEMENTS 3 Article 9 Form of arbitration agreements 3 Article 10 Invalid arbitration agreements 3 Article 11 Relationship between arbitration clause and contract 3 CHAPTER III 4 ARBITRATORS 4 Article 12 Arbitrators 4 Article 13 Rights and obligations of arbitrators 4 CHAPTER IV 5 ARBITRATION CENTRES 5 Article 14 Conditions for establishment of arbitration centres 5 Article 15 Publication in newspaper of announcement of establishment of arbitration centres 5 Article 16 Legal status and organizational structure of arbitration centres 6 Article 17 Duties and powers of arbitration centres 6 Article 18 Termination of operation of arbitration centres 7 CHAPTER V 7 ARBITRATION PROCEEDINGS 7 Article 19 Right to choose form of dispute resolution by arbitration 7 Article 20 Statement of claim 7 Article 21 Limitation period for initiating proceedings for dispute resolution by arbitration 8 Article 22 Arbitration fees 8 Article 23 Venue of arbitration 8 Article 24 Statement of defence 9 Article 25 Establishment of arbitration tribunals at arbitration centres 9 Article 26 Arbitration tribunal established by the parties 10 Article 27 Replacement of arbitrators 11 © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com ii Article 28 Amendment of and addition to, or withdrawal of, statement of claim 11 Article 29 Counter-claim 12 Article 30 Consideration of arbitration agreement, jurisdiction of arbitration tribunal for dispute resolution 12 Article 31 Study of documents and determination of facts 13 Article 32 Collection of evidence 13 Article 33 Right to request application of injunctive relief 13 Article 34 Procedures for application of injunctive relief 13 Article 35 Alteration or rescission of injunctive relief 14 Article 36 Responsibilities of applicant for injunctive relief 14 Article 37 Conciliation 15 Article 38 Hearings for dispute resolution 15 Article 39 Attendance at hearings for dispute resolution 15 Article 40 Absence of parties 15 Article 41 Adjournment of hearing for dispute resolution 16 Article 42 Principles for issuance of arbitral award 16 Article 43 Minutes of hearing of dispute resolution 16 Article 44 Arbitral award 16 Article 45 Announcement of arbitral award 17 Article 46 Correction of arbitral award 17 Article 47 Stay of dispute resolution 17 Article 48 Archiving arbitration files 17 Article 49 Resolution of disputes with a foreign element by arbitration 17 CHAPTER VI 18 SETTING ASIDE OF ARBITRAL AWARDS AND ENFORCEMENT OF ARBITRAL AWARDS 18 Article 50 Right to apply for arbitral award to be set aside 18 Article 51 Application for arbitral award to be set aside 18 Article 52 Acceptance of jurisdiction over application 18 Article 53 Consideration by court of application for arbitral award to be set aside 19 Article 54 Grounds for setting aside arbitral award 20 Article 55 Appeal or protest against court decision 20 Article 56 Consideration of appeal or protest 20 Article 57 Enforcement of awards 21 Article 58 Court fees regarding arbitration 21 CHAPTER VII 22 STATE ADMINISTRATION OF ARBITRATION 22 Article 59 Contents of State administration of arbitration 22 Article 60 Body in charge of State administration of arbitration 22 CHAPTER VIII 22 IMPLEMENTING PROVISIONS 22 Article 61 Application of this Ordinance to arbitration organizations established prior to date of effectiveness of this Ordinance 22 Article 62 Effectiveness 23 Article 63 Implementing provision 23 © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 1 STANDING COMMITTEE SOCIALIST REPUBLIC OF VIETNAM OF NATIONAL ASSEMBLY Independence - Freedom - Happiness No. 08-2003-PL-UBTVQH11 Hanoi, 25 February 2003 ORDINANCE ON COMMERCIAL ARBITRATION In order to contribute to the resolution of disputes arising from commercial activities, to ensure the freedom to conduct business, to protect the lawful rights and interests of the parties, and to develop the socialist- oriented market economy; Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam as amended and added to by Resolution 51-2001-QH10 dated 25 December 2001 of Legislature X of the National Assembly at its 10th Session; Pursuant to Resolution 12-2002-QH11 dated 16 December 2002 of Legislature XI of the National Assembly at its 2nd Session on the program for formulation of laws and ordinances of Legislature XI of the National Assembly from 2002 - 2007 and in 2003; This Ordinance provides for commercial arbitration. CHAPTER I General Provisions Article 1 Governing scope This Ordinance provides for arbitral organizations and proceedings for the resolution of disputes arising from commercial activities in accordance with an agreement between the parties. Article 2 Interpretation of terms In this Ordinance, the following terms shall be interpreted as follows: 1. Arbitration means a method for resolving disputes arising from commercial activities, agreed by the parties and conducted in accordance with the order and procedures stipulated in this Ordinance. 2. Arbitration agreement means an agreement between the parties to commit to use arbitration to resolve disputes which may arise or which have arisen from commercial activities. 3. Commercial activities means the performance of one or more commercial acts by a business organization or individual, comprising purchase or sale of goods; provision of services; distribution, commercial representation or agency; bailment; leasing out or leasing; hire-purchase; construction; consulting; engineering; licensing; investment; finance and banking; insurance; exploration and exploitation; transportation of goods and passengers by air, sea, rail or road; and other commercial acts in accordance with law. © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 2 4. Dispute with a foreign element means a dispute arising from commercial activities in which one or more of the participating parties is a foreigner or foreign legal entity, or where the grounds for establishing, altering or terminating the relationship which is the subject of dispute arise abroad, or where assets relating to the dispute are located abroad. 5. Arbitrator means a person satisfying all of the conditions stipulated in article 12 of this Ordinance and selected by the parties or appointed by an arbitration centre or a competent court to resolve a dispute. 6. Relative means a person belonging to the three inheritance ranks stipulated in the Civil Code. 7. Event of force majeure means an unforeseeable event which occurs for objective reasons and which is not able to be remedied despite the taking of all necessary and possible measures. Article 3 Principles for dispute resolution by arbitration 1. A dispute shall be resolved by arbitration if the parties reach an arbitration agreement before or after the occurrence of the dispute. 2. When resolving a dispute, an arbitrator must be independent, objective and impartial, must follow the law, and must respect the agreement of the parties. Article 4 Form of dispute resolution by arbitration A dispute between parties shall be resolved by an arbitration tribunal organized by an arbitration centre or by an arbitration tribunal established by the parties pursuant to the provisions of this Ordinance. An arbitration tribunal shall consist of three arbitrators or of a sole arbitrator as agreed by the parties. Article 5 Competence to resolve a dispute in cases where there is an arbitration agreement Where a dispute already has an arbitration agreement but one party institutes court proceedings, the court must refuse to accept jurisdiction, unless the arbitration agreement is invalid. Article 6 Effect of an arbitral award 1 An arbitral award shall be final and the parties must carry it out, except in cases where the arbitral award is set aside by a court in accordance with the provisions of this Ordinance. Article 7 Principle of application of law to dispute resolution 1. With respect to a dispute between Vietnamese parties, the arbitration tribunal shall apply the law of Vietnam in order to resolve the dispute. 2. With respect to a dispute with a foreign element, the arbitration tribunal shall apply the law chosen by the parties. The choice of a foreign law and its application shall not be inconsistent with the fundamental principles of the law of Vietnam. Where the parties are unable to choose the law to resolve the dispute, it shall be decided by the arbitration tribunal. 1 Allens Arthur Robinson Note: The literal translation is "arbitral decision". The translation "arbitral award" has been used throughout this translation for consistency with the UNCITRAL Model Law on Arbitration. © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 3 Article 8 Applicability of international treaties In the case of any inconsistency between an international treaty signed or acceded to by the Socialist Republic of Vietnam and the provisions of this Ordinance, the provisions of the international treaty shall apply. CHAPTER II Arbitration Agreements Article 9 Form of arbitration agreements 1. An arbitration agreement must be made in writing. An arbitration agreement in the form of a letter, telegram, telex, facsimile, electronic mail or any other written form which clearly shows the intention of the parties to resolve disputes by arbitration shall be deemed to be a written arbitration agreement. 2. An arbitration agreement may be an arbitration clause in a contract or it may be a separate agreement. Article 10 Invalid arbitration agreements An arbitration agreement shall be invalid in the following circumstances: 1. The dispute which arises does not belong to commercial activities as defined in clause 3 of article 2 of this Ordinance. 2. A signatory to the arbitration agreement lacks authority to enter into it pursuant to law. 3. One party to the arbitration agreement lacks full civil legal capacity. 4. The arbitration agreement fails to specify, or to specify clearly, the subjects of the dispute or the arbitration organization authorized to resolve disputes, and the parties have failed to enter into any supplementary agreement. 5. The arbitration agreement was not made in accordance with the provisions of article 9 of this Ordinance. 6. A party to the arbitration agreement was deceived or threatened, and requests that the arbitration agreement be declared invalid; the limitation period for requesting that an arbitration agreement be declared invalid shall be six months from the date of entering into it, but must be prior to the date on which an arbitration tribunal opens the initial hearing to resolve a dispute as stipulated in article 30 of this Ordinance. Article 11 Relationship between arbitration clause and contract An arbitration clause shall exist independently of the contract. Any modification, extension, termination or invalidity of a contract shall not affect the validity of the arbitration clause. © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 4 CHAPTER III Arbitrators Article 12 Arbitrators 1. Any Vietnamese citizen who satisfies all of the following conditions may act as an arbitrator: (a) Having full civil legal capacity; (b) Having good ethics and being honest, impartial and objective; (c) Having a university degree and at least five years' work experience in the field of his or her studies. 2. Any person under administrative detention, currently being prosecuted for a criminal offence, or having been convicted and whose conviction has not yet been expiated shall be barred from acting as an arbitrator. 3. Judges, prosecutors, investigators, enforcement officers, and officials currently working in the people's courts, the people's procuracy, investigative bodies or enforcement bodies shall be barred from acting as arbitrators. Article 13 Rights and obligations of arbitrators 1. Arbitrators shall have the following rights: (a) To accept or refuse to resolve a dispute; (b) To remain independent during dispute resolution; (c) To refuse to provide information concerning a dispute; (d) To receive remuneration. 2. Arbitrators shall have the following obligations: (a) To comply with the provisions of this Ordinance; (b) To be impartial and objective during dispute resolution; (c) To refuse to resolve a dispute in the circumstances stipulated in clause 1 of article 27 of this Ordinance; (d) To keep confidential the contents of the dispute which he or she resolves; (dd) Not to accept bribes and not to commit other acts in breach of the ethics of an arbitrator. © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 5 CHAPTER IV Arbitration Centres Article 14 Conditions for establishment of arbitration centres 1. Depending on the status of socio-economic development in localities, arbitration centres may be established in a number of localities pursuant to regulations of the Government. 2. If there is a request from at least five founding members who are qualified to act as arbitrators in accordance with article 12 of this Ordinance and who are introduced by the Vietnam Lawyers Association, the Minister of Justice shall consider and make a decision on issuance of a licence for establishment of an arbitration centre. 3. An application file for establishment of an arbitration centre shall comprise the following: (a) Application for establishment of an arbitration centre; (b) Full names, addresses and occupations of the founding members; (c) Charter of the arbitration centre; (d) Letter of introduction from the Vietnam Lawyers Association. 4. An application for establishment of an arbitration centre shall contain the following particulars: (a) Date of the application; (b) Full names, addresses and occupations of the founding members; (c) Sector of operation of the arbitration centre; (d) Proposed office location of the arbitration centre. 5. Within a time-limit of forty five (45) days from the date of receipt of a proper application file, the Minister of Justice shall issue a licence for establishment of an arbitration centre and approve its charter. In the case of refusal, there must be a written reply specifying the reasons therefor. 6. Within a time-limit of thirty (30) days from the date of receipt of its establishment licence, an arbitration centre must register its operations with the Department of Justice of the province or city under central authority (hereinafter referred to as Department of Justice) in the locality where the arbitration centre locates its office. If, upon expiry of this time-limit, an arbitration centre has failed to register, its licence shall be revoked. The Government shall provide regulations on the order and procedures for arbitration centres to register their operations. Article 15 Publication in newspaper of announcement of establishment of arbitration centres 1. Within a time-limit of thirty (30) days from the date of issuance of an establishment licence, an arbitration centre must cause to be published in three consecutive issues of a central daily © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 6 newspaper or a daily newspaper in the locality where it registers its operation, the following main items: (a) Title and office address of the arbitration centre; (b) Sector of operation of the arbitration centre; (c) Number of certificate of registration of operation, issuing-body and date of issuance; (d) Date of commencement of operations of the arbitration centre. 2. An arbitration centre shall display at its office a notice of the items stipulated in clause 1 of this article and a list of arbitrators at the arbitration centre. Article 16 Legal status and organizational structure of arbitration centres 1. An arbitration centre shall be a non-governmental organization with legal entity status, its own seal and bank account. 2. An arbitration centre may establish branches and representative offices. 3. An arbitration centre shall have an executive committee and arbitrators. The executive committee of an arbitration centre shall include a chairman and one or more vice chairman and may also include a general secretary appointed by the chairman of the arbitration centre. Any individual invited by an arbitration centre to act as an arbitrator must satisfy all of the conditions stipulated in article 12 of this Ordinance. Article 17 Duties and powers of arbitration centres Arbitration centres shall have the following duties and powers: 1. To draw the charter and procedural rules of the arbitration centre which shall not be inconsistent with the provisions of this Ordinance. 2. To invite individuals who satisfy all of the conditions stipulated in article 12 of this Ordinance to act as arbitrators for the centre. 3. To appoint arbitrators to establish an arbitration tribunal in accordance with the provisions of this Ordinance. 4. To provide administrative and office services for arbitration tribunals to resolve disputes. 5. To collect arbitration fees and to pay remuneration to arbitrators in accordance with the charter of the arbitration centre. 6. To hold courses for arbitrators to derive lessons from experience and to foster and improve their expertise and skills in dispute resolution. © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 7 7. To report periodically on the operations of the arbitration centre to the Ministry of Justice, the Vietnam Lawyers Association, and the Department of Justice in the locality where the arbitration centre registers its operation. 8. To remove the name of an arbitrator from the list of arbitrators of the arbitration centre when the arbitrator commits a serious breach of the provisions of this Ordinance and the charter of the arbitration centre. 9. To archive files and to provide copies of arbitral awards at the request of the parties or of competent State bodies. 10. Other duties and powers in accordance with law. Article 18 Termination of operation of arbitration centres 1. The operation of an arbitration centre shall be terminated in the following circumstances: (a) In the circumstances prescribed in the charter of the arbitration centre; (b) Upon revocation of its establishment licence. 2. Upon termination of its operation, an arbitration centre shall return its establishment licence to the issuing-body. 3. The Government shall provide regulations on the order and procedures for termination of operation of arbitration centres. CHAPTER V Arbitration Proceedings Article 19 Right to choose form of dispute resolution by arbitration The parties shall have the right to choose an arbitration centre or an arbitration tribunal established by the parties to resolve their dispute in accordance with the provisions relating to arbitration proceedings in this Ordinance. Article 20 Statement of claim 1. In order for a dispute to be resolved by an arbitration centre, the claimant shall draw a statement of claim and file it with the arbitration centre. A statement of claim filed with an arbitration centre shall contain the following basic particulars: (a) Date on which the statement of claim is drawn; (b) Names and addresses of the parties; (c) Summary of the dispute; © Allens Arthur Robinson - Vietnam Laws Online Database on www.vietnamlaws.com 8 (d) Relief sought by the claimant; 2 (dd) Value of the assets claimed by the claimant; (e) Arbitrator at the arbitration centre which the claimant selects. 2. In order for a dispute to be resolved by an arbitration tribunal established by the parties, the claimant shall draw a statement of claim and forward it to the respondent; the particulars of the statement of claim shall be as stipulated in clause 1 of this article. 3. The claimant shall annex to the statement of claim the original or a copy arbitration agreement, and originals or copies of documents and evidence. Copies must be validly certified. 4. Arbitration proceedings shall commence upon receipt by an arbitration centre of the statement of claim of the claimant or, in the case of dispute resolution by an arbitration tribunal established by the parties, upon receipt by the respondent of the statement of claim of the claimant. 5. Within a time-limit of five working days from the date of receipt of a statement of claim, an arbitration centre shall forward a copy of it, together with the documents referred to in clause 3 of this article, to the respondent. Article 21 Limitation period for initiating proceedings for dispute resolution by arbitration 1. With respect to a dispute for which the law stipulates a limitation period for initiating proceedings, such limitation period shall apply. 2. With respect to a dispute for which the law does not stipulate a limitation period for initiating proceedings, the limitation period for initiating proceedings for dispute resolution by arbitration shall be two years from the date the dispute arises, except in cases of events of force majeure. The period from the date of occurrence of an event of force majeure up until the date on which it no longer exists shall be excluded when calculating the limitation period. Article 22 Arbitration fees 1. A claimant shall pay arbitration fees in advance, unless the parties otherwise agree. 2. In the case of dispute resolution by an arbitration centre, the executive committee of the arbitration centre shall determine the arbitration fees in accordance with the charter of the centre. 3. In the case of dispute resolution by an arbitration tribunal established by the parties, the arbitration tribunal shall determine the arbitration fees. 4. The party which loses the case shall bear the arbitration fees, unless the parties otherwise agree. Article 23 Venue of arbitration The parties shall have the right to agree on the venue for dispute resolution. In the absence of any such agreement, the arbitration tribunal shall decide the venue, but it must ensure convenience to the parties during dispute resolution. 2 Allens Arthur Robinson Note: The literal translation is "requests of the claimant".