Who has obligation to buy professional liability insurance for their lawyer at law-practicing organizations in Vietnam?

Who has obligation to buy professional liability insurance for their lawyer at law-practicing organizations in Vietnam?

Article 40 of the 2006 Law on Lawyers, amended by Clause 17, Article 1 of the 2012 Law on Lawyers, stipulates obligations of a law-practicing organization as follows:

1. Operate consistently with the businesses written in the Certificate of registration.

2. Implement the agreements made with clients.

3. Appoint their lawyers to participate in proceedings according to the assignment of the bar association.

4. Enable their lawyers to provide legal supports and attend lawyer training courses.

5. Paying compensation for the damage caused to clients by their lawyers.

6. Buy professional liability insurance for their lawyer as prescribed by the laws on insurance.

7. Comply with this Law and the laws on labor, taxation, finance, and statistics.

8. Comply with the requirements of competent State agencies of reporting and inspection.

9. Admit apprentice lawyers and appoint eligible lawyers to instruct them; facilitate and supervise the apprenticeship.

10. Perform the management and ensure that their lawyers comply with law, the charter of the Vietnam Bar Federation, the code of ethics and professional manners of Vietnamese lawyers.

11. Report their organization and operation as prescribed by law.

12. Other obligations as prescribed by the relevant laws.

Thus, according to the above regulations in Vietnam, law-practicing organizations must buy professional liability insurance for their lawyers. If you do not buy professional liability insurance, you will be fined.

Who has obligation to buy professional liability insurance for their lawyer at law-practicing organizations in Vietnam? (Image from the Internet)

How much is penalty for a law-practicing organization that fails to buy professional liability insurance for its lawyers in Vietnam? 

According to Clause 1, Article 7, Decree 82/2020/ND-CP stipulates violations of regulations on the activities of law-practicing organizations as follows:

1. Fine from 7,000,000 VND to 10,000,000 VND for one of the following acts:

a) Register operations or registering to change the content of operating registration without the deadline with the competent authority;

b) Notify competent agencies or organizations on time about the location of a law practice facility abroad or termination of operation of a law practice facility abroad;

c) Notify and report on time to competent agencies and organizations about operation registration, change in operation registration content, suspension, resumption of operation, self-termination of operation, consolidation, merger, conversion of practice organization form;

d) Notify and report on time to competent authorities about the establishment, suspension, continued operation or self-termination of operations of branches of foreign law-practicing organizations or foreign law firms, branches of foreign law firms in Vietnam;

d) Notify the competent authority on time about hiring a foreign lawyer;

e) Untimely, incomplete or inaccurate reporting on organizational and operational status to competent authorities;

g) Announce incorrect content, time limit, number of times, and form as prescribed for the content of operation registration or change of operation registration of a law-practicing organization;

h) Post the establishment of a foreign law-practicing organization in Vietnam on time or in the wrong number of times;

i) Purchase inadequate professional liability insurance for lawyers in your organization;

k) Fail to prepare, manage, and use books and forms according to regulations.

Pursuant to Clause 4 and Clause 5, Article 4 of Decree 82/2020/ND-CP stipulating fine levels:

4. The fines specified in Chapters II, III, IV, V, VI and VII of this Decree are applied to administrative violations by individuals, except those specified in Clause 5 of this Article. In case an organization commits an administrative violation like an individual, the fine is 2 times the fine for an individual.

5. The fine levels specified in Articles 7 , 8, 9, 16, 17, 24, 26, 29, 33, 39, 50, 53, 63, 71, 72, 73, 74 and 80 of this Decree are Fines for administrative violations by organizations.

Therefore, if a law practice organization fails to buy professional liability insurance for lawyers practicing at its organization in Vietnam, it will be fined from VND 7,000,000 to VND 10,000,000.

Best regards!