Regulations on settlement of disputes over business investment activities in Vietnam

Regulations on settlement of disputes over business investment activities in Vietnam (Internet image)

Regarding this issue, LawNet responded as follows:

1. Regulations on guarantees for business investment activities in Vietnam

According to Article 11 of the Law on Investment 2020, the guarantees for business investment activities are as follows:

- Investors are not required by the State to satisfy the following requirements:

+ Give priority to purchase or use of domestic goods/services; or only purchase or use goods/services provided by domestic producers/service providers;

+ Achieve a certain export target; restrict the quantity, value, types of goods/services that are exported or domestically produced/provided;

+ Import a quantity/value of goods that is equivalent to the quantity/value of goods exported; or balance foreign currencies earned from export to meet import demands;

+ Reach a certain rate of import substitution;

+ Reach a certain level/value of domestic research and development;

+ Provide goods/service at a particular location in Vietnam or overseas;

+ Have the headquarters situated at a location requested by a competent authority.

- Depending on the socio-economic conditions and demands for investment attraction in each period, the Prime Minister shall decide to apply forms of guarantee of the State to execute investment projects subject to approval for their investment guidelines by the National Assembly, the Prime Minister, and other important investment projects on infrastructural development.

2. Regulations on guarantees for business investment upon changes of laws in Vietnam

Guarantees for business investment upon changes of laws according to Article 13 of the Law on Investment 2020 is as follows:

-  Where a new law provides more favorable investment incentives, investors are entitled to enjoy the new incentives for the remaining period of the incentive enjoyment of the project, except for special investment incentives for the investment projects in the case specified in Point a Clause 5 Article 20 of the Law on Investment 2020.

- Where a new law that provides less favorable investment incentives than those previously enjoyed by investor is promulgated, investors shall keep enjoying the current incentives for the remaining period of the incentive enjoyment of the project.

- The regulations in Clause 2 of Article 13 of the Law on Investment 2020 do not apply if regulations of a legal document are changed for reasons of national defense and security, social order and security, social ethics, public health, or environmental protection.

- Where an investor is no longer eligible for investment incentives prescribed in Clause 3 of Article 13 of the Law on Investment 2020, one or more of the following solutions shall be adopted:

+ Deduct the damage actually suffered by the investor from the investor's taxable income;

+ Adjust the objectives of the investment project;

+ Assist the investor in remedying damage.

- With regard to the investment guarantee measure in Clause 4 of Article 13 of the Law on Investment 2020, the investor shall make a written request within 03 years from the effective date of the new legal document.

3. Regulations on settlement of disputes over business investment activities in Vietnam

According to Article 14 of the Law on Investment 2020, the settlement of disputes over business investment activities is as follows:

(1) Disputes over business investment activities in Vietnam shall be settled through negotiation and conciliation. If the negotiation or conciliation fails, the dispute shall be settled by an arbitration body or by a court in accordance with (2), (3) and (4).

(2) Every dispute between a Vietnamese investor and a foreign-invested business organization, or between a domestic investor or a foreign-invested business organization and a regulatory agency over business investment activities within Vietnam’s territory shall be settled by a Vietnam's arbitration body or Vietnam’s court, except for the cases in (3)

(3) Every dispute between investors, one of which is a foreign investor or a business organization defined in Points a, b and c Clause 1 Article 23 of the Law on Investment 2020, shall be settled by one of the following agencies/organizations:

- Vietnam’s court;

- Vietnam’s arbitration body;

- Foreign arbitration body;

- International arbitration body;

- An arbitral tribunal established by the parties in dispute.

(4)  Every dispute between a foreign investor and a regulatory agency over business investment activities within Vietnam’s territory shall be settled by Vietnam’s arbitral tribunal;

Or Vietnam’s court, unless otherwise agreed under a contract or prescribed by an international treaty to which the Socialist Republic of Vietnam is a signatory.

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