Fundamental principles in commercial activities in Vietnam

Fundamental principles in commercial activities in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What are commercial activities?

According to Clause 1, Article 3 of the Commercial Law 2005, commercial activities mean activities for the purpose of generating profits, including: sale and purchase of goods, provision of services, investment, commercial promotion and other activities for the profit purpose.

2. Fundamental principles in commercial activities in Vietnam

Fundamental principles in commercial activities in Vietnam according to Articles 10, 11, 12, 13, 14 and 15 of the Commercial Law 2005 are as follows:

* Principle of traders’ equality before law in commercial activities

Traders of all economic sectors are equal before law in commercial activities.

* Principle of freedom and freewill to agreement in commercial activities

- Parties have the rights of freedom to reach agreements not in contravention of the provisions of law, fine traditions and customs and social ethics in order to establish their rights and obligations in commercial activities. The State respects and protects such rights.

- In commercial activities, the parties shall act on their own freewill, and neither party is allowed to impose its own will on, to force, intimidate or obstruct, the other party.

* Principle of application of customs in commercial activities pre-established between parties

Except otherwise agreed, the parties shall be regarded as automatically applying customs in commercial activities pre-established between them which they have already known or ought to know, provided that such customs are not contrary to the provisions of law.

* Principle of application of practices in commercial activities

Where it is neither provided for by law nor agreed by the parties, and there exist no customs pre-established between them, commercial practices shall be applied provided that such practices are not contrary to the principles provided for in the Commercial Law 2005 and the Civil Code.

* Principle of protection of legitimate interests of consumers

- Traders conducting commercial activities are obliged to provide consumers with sufficient and truthful information on goods and/or services they trade in or provide and take responsibility for the accuracy of such information.

- Traders conducting commercial activities must be responsible for the quality and lawfulness of goods and/or services they trade in or provide.

* Principle of recognition of legal validity of data messages in commercial activities

In commercial activities, data messages which satisfy all technical conditions and standards provided for by law shall be recognized legally valid as documents.

3. Regulations on termination of operations in Vietnam of foreign traders

Regulations on termination of operations in Vietnam of foreign traders according to Article 23 of the Commercial Law 2005 are as follows:

- Foreign traders shall terminate their operations in Vietnam in the following cases:

+ Upon expiration of the operation duration stipulated in their licenses;

+ At the request of traders, which is approved by competent state management agencies;

+ Under decisions of competent state management agencies as a sanction against their violations of law and their licenses;

+ Where traders are declared bankrupt;

+ Where foreign traders terminate their operations according to foreign laws, for representative offices, branches or foreign parties to business cooperation contracts with Vietnamese parties;

+ Other cases provided for by law.

- Before terminating their operations in Vietnam, foreign traders are obliged to pay debts and fulfill other obligations toward the State, concerned organizations and individuals in Vietnam.

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