Vietnam is an attractive destination for foreign direct investment, offering growth opportunities across manufacturing, logistics, trading, technology, and services. However, when disputes arise, many foreign-invested enterprises (FDI companies) quickly realize that resolving disputes in Vietnam is more complex than expected.
These difficulties rarely stem from a single legal issue. Instead, they arise from a combination of legal, procedural, cultural, and strategic challenges—especially for companies that do not have continuous local legal support.
Understanding these challenges early is essential for protecting business interests and avoiding unnecessary losses.
One of the first difficulties FDI companies encounter is unfamiliarity with Vietnamese dispute resolution procedures.
Common challenges include:
Complex procedural requirements
Strict rules on evidence and documentation
Formal language and filing standards
Multiple procedural stages
Foreign companies often underestimate how procedural compliance can affect outcomes. Even strong claims may be delayed or dismissed due to procedural mistakes rather than substantive issues.
Disputes in Vietnam are primarily conducted in Vietnamese.
FDI companies frequently face problems such as:
Contracts drafted in bilingual form with inconsistencies
Evidence and correspondence in multiple languages
Misinterpretation of legal terminology
Translation errors or inconsistencies can seriously weaken legal arguments. In many cases, disputes hinge on subtle wording differences that foreign parties did not anticipate.
Many FDI disputes originate from contracts that were not drafted with Vietnamese enforcement in mind.
Common contract-related issues include:
Generic templates used across multiple jurisdictions
Ambiguous dispute resolution clauses
Governing law provisions that conflict with local enforcement
Unclear allocation of risk and liability
When disputes arise, Vietnamese courts and arbitration tribunals rely heavily on written contracts. Commercial assumptions or overseas practices carry little weight if they are not reflected clearly in enforceable terms.
Even when contracts are adequate, FDI companies often struggle with evidence.
Typical problems include:
Missing delivery or acceptance records
Informal approvals via email or messaging platforms
Inconsistent internal documentation across departments
Lack of proper authorization records
These gaps usually arise long before disputes occur. By the time legal action is considered, it may be impossible to reconstruct evidence properly.
FDI companies often approach disputes based on home-country expectations, which may not align with local practice.
Differences may appear in:
Negotiation style
Communication tone
Expectations around compromise and timing
Interpretation of silence or delay
Misreading these signals can lead to premature escalation or missed opportunities for early resolution.
Winning a dispute is only part of the problem. Enforcement is often the real challenge.
FDI companies frequently struggle with:
Identifying counterparty assets in Vietnam
Delays in enforcement procedures
Limited leverage after judgment or award
Cross-border enforcement coordination
A favorable outcome that cannot be enforced offers little commercial value.
Another common difficulty is choosing an unsuitable dispute resolution forum.
FDI companies may:
File lawsuits in courts without jurisdiction
Overlook arbitration clauses
Choose foreign courts without enforceability in Vietnam
Once proceedings are initiated in the wrong forum, correcting the mistake can be costly and time-consuming.
Many FDI companies involve lawyers only after disputes escalate significantly.
At that point:
Damaging communications may already exist
Evidence may be incomplete
Legal options may be limited
Early mistakes often determine the trajectory of the entire dispute.
FDI companies often rely on overseas legal teams to manage disputes in Vietnam.
While these teams may be strong in general legal strategy, they may lack:
Practical knowledge of Vietnamese procedure
Familiarity with local enforcement realities
Experience with Vietnamese authorities and institutions
This disconnect often leads to misaligned strategy and unexpected outcomes.
Disputes in Vietnam often require significant involvement from senior management.
FDI companies face:
Extended timelines
Frequent requests for documents and clarification
Ongoing coordination between headquarters and local teams
Without proper legal structure, disputes consume management resources far beyond what was initially expected.
Most of these challenges arise not from bad faith, but from:
Lack of continuous legal oversight
Reactive dispute handling
Contracts and procedures not adapted to Vietnam
FDI companies often focus on operations and growth, assuming legal issues can be addressed when needed. Unfortunately, dispute risks accumulate quietly over time.
Many FDI companies rely on ad hoc legal advice only when disputes occur.
This approach often fails because:
Contracts are already signed
Evidence gaps already exist
Strategic options are already limited
Reactive legal support manages damage—but rarely prevents it.
Ongoing legal consultancy provides FDI companies with continuous legal oversight, not just dispute response.
This approach helps by:
Structuring contracts for enforceability in Vietnam
Monitoring legal risk during daily operations
Preserving evidence properly
Advising on dispute strategy before escalation
Aligning legal decisions with business objectives
As a result, disputes are either avoided or resolved more efficiently.
FDI companies with long-term operations in Vietnam face cumulative legal risk.
Without ongoing legal support:
Small issues turn into major disputes
Compliance gaps become enforcement risks
Disputes become harder to control over time
Preventive legal management is essential for sustainable operations.
DEDICA provides ongoing legal consultancy services tailored specifically for FDI companies operating in Vietnam.
DEDICA supports clients by:
Reviewing and structuring contracts
Advising on dispute prevention and strategy
Supporting negotiations and dispute resolution
Representing clients in court and arbitration
Helping manage enforcement and recovery
DEDICA’s approach focuses on practical solutions, risk prevention, and long-term business protection, not just dispute reaction.
FDI companies often face significant difficulties when resolving disputes in Vietnam—not because the legal system is inaccessible, but because disputes are handled too late or without proper local strategy.
Common challenges include procedural complexity, evidence gaps, contract weaknesses, enforcement uncertainty, and cultural differences.
By engaging ongoing legal consultancy, FDI companies gain the legal structure, foresight, and local insight needed to manage disputes effectively—or avoid them altogether.
📞 Hotline: (+84) 39 969 0012 (Available via WhatsApp, WeChat, Zalo)
🕒 Working Hours: Monday – Friday (8:30 – 18:00)
Contact us today for a free initial consultation with our experienced lawyers!
Select a platform to view details
