Currently, some businesses choose to settle disputes by Commercial arbitration instead of initiating lawsuits in court. What is the procedure for dispute settlement by Commercial arbitration?
Article table of contents
1. What is Commercial arbitration? Conditions for dispute settlement by arbitration in Vietnam
- Commercial arbitration means a mode of dispute settlement agreed by the parties and to be conducted in accordance with the provisions of Vietnam's Law on Commercial Arbitration 2010.
- Conditions for dispute settlement by arbitration
+ A dispute shall be settled by arbitration if the parties have an arbitration agreement. An arbitration agreement may be made either before or after a dispute arises.
+ When one of the parties being an individual to an arbitration agreement dies or loses his/her act capacity, such arbitration agreement remains valid for his/her heir or representative at law. unless otherwise agreed by the parties.
+ When one of the parties being an institution to an arbitration agreement has to terminate its operation, goes bankrupt, or is dissolved, consolidated, merged, divided, split up or reorganized, such arbitration agreement remains valid for an institution that takes over the rights and obligations of the institution to such arbitration agreement, unless otherwise agreed by the parties.
(According to Clause 1, Article 3 and Article 5 of Vietnam's Commercial Arbitration Law 2010)
Dispute settlement procedures by commercial arbitration (Illustration)
2. Arbitration's jurisdiction to settle disputes
Arbitration's jurisdiction to settle disputes as follows:
1. Disputes among parties which arise from commercial activities.
2. Disputes among parties at least one of whom conducts commercial activities.
3. Other disputes among parties which are stipulated by law to be settled by arbitration.
(Article 2 of Vietnam's Commercial Arbitration Law 2010)
3. Dispute settlement procedures by Commercial arbitration
Dispute settlement by commercial arbitration shall be carried out according to the following procedures:
3.1. Submit the petitions and enclosed documents
- When a dispute is settled at an arbitration center, the plaintiff shall file a petition with the arbitration center. When a dispute is settled by ad hoc arbitration, the plaintiff shall make a petition and send it to the defendant.
- A petition contains:
+ Date of its making;
+ Names and addresses of the parties; names and addresses of witnesses, if any;
+ Summary of the circumstances of the dispute:
+ Grounds and evidence for initiating the lawsuit, if any:
+ Specific requirements of the plaintiff and the value of the dispute:
+ Name and address of the person whom the plaintiff selects as arbitrator or requests to be designated as arbitrator.
- Notification of petitions: Unless otherwise agreed by the parties or provided by the rules of proceedings of an arbitration center then:
Within 10 days after receiving the plaintiff's petition, enclosed documents and arbitration charge receipt, the arbitration center shall send to the defendant copies of the petition and documents specified in Clause 3, Article 30 of of Vietnam's Commercial Arbitration Law 2010.
- Statute of limitations for initiating a lawsuit for dispute settlement by arbitration: Unless otherwise provided by discrete laws, the statute of limitations according to arbitral procedures is 2 years from the time of infringement of lawful rights and interests.
(According to Article 30, Article 32 and Article 33 of Vietnam's Law on Commercial Arbitration 2010)
3.2. Self-defense statements and the sending thereof
- For a dispute to be settled at an arbitration center, unless otherwise agreed by the parties or provided by the arbitration center's rules of proceedings, within 30 days after receiving a petition and enclosed documents:
The defendant shall send to the arbitration center a self-defense statement. At the request of one party or all parties, this time limit may be extended by the arbitration center based on the particular circumstances of the case.
- A self-defense statement contains:
+ Date of making;
+ Name and address of the defendant;
+ Grounds and evidence, if any. for self-defense;
+ Name and address of the person whom the defendant selects as arbitrator or requests for designation as arbitrator.
-For a dispute to be settled by ad hoc arbitration, unless otherwise agreed by the parties, within 30 days after receiving the plaintiff's petition and enclosed documents:
The defendant shall send to the plaintiff and arbitrator the self-defense statement and name and address of the person whom the defendant selects as arbitrator.
(According to Clauses 1, 2 and 3, Article 35 of Vietnam's Law on Commercial Arbitration 2010)
3.3. Composition of an arbitration council
- An arbitration council may be composed of one or more arbitrators as agreed by the parties.
- When the parties fail to reach agreement on the number of arbitrators, an arbitration council shall be composed of three arbitrators.
(According to Article 39 of Vietnam's Law on Commercial Arbitration 2010)
3.4. Composition and procedures of a dispute settlement meeting
- A dispute settlement meeting shall be held in private, unless otherwise agreed by the parties.
- The parties may personally, or authorize their representatives to. attend dispute settlement meetings and may invite witnesses and persons to protect their lawful rights and interests.
- When agreed by the parties, the arbitration council may allow others to attend dispute settlement meetings.
- The order and procedures for holding dispute settlement meetings shall be specified in the arbitration center's rules of arbitral proceedings or agreed by the parties in case of ad hoc arbitration.
(According to Article 55 of Vietnam's Law on Commercial Arbitration 2010)
3.5. Conciliation and recognition of successful conciliation
- At the request of the parties, the arbitration council shall conduct conciliation for the parties to reach agreement on the settlement of their dispute.
- If such an agreement can be reached, the arbitration council shall make a record of successful conciliation and have it signed by the parties and certified by the arbitrators.
- The arbitration council shall issue a decision recognizing the parties" agreement. This decision is final and as valid as an arbitral award.
(According to Article 58 of Vietnam's Law on Commercial Arbitration 2010)
3.6. Principles of issuance of awards
- The arbitration council shall issue an arbitral award on the basis of majority vote.
- In case a majority vote cannot be obtained, an arbitral award shall be issued based on the opinion of the arbitration council's chairman.
(According to Article 60 of Vietnam's Law on Commercial Arbitration 2010)
Thus, in the field of commerce, if an enterprise has an agreement on arbitration when settling a dispute, that settlement shall be carried out in accordance with the legal order and procedures on dispute settlement by Commercial arbitration.
Quoc Dat
