In international business, a distribution agency contract plays a very important role — it connects manufacturers, distributors, markets and end customers. When a dispute occurs, if not handled skillfully, it can lead to financial loss, reputational loss and complicated legal procedures. Mediation (commercial mediation/conciliation) is one of the preferred dispute resolution methods because of its flexibility, savings, and preservation of the business relationship between the parties.
This article will clarify how to mediate international distribution agency contract disputes with the latest perspective under Vietnamese law, along with practical steps and points to note for businesses.
Decree 22/2017/ND‑CP on commercial mediation
This is an important document regulating commercial mediation in Vietnam — including mediators, commercial mediation organizations, principles, procedures, and results of mediation.
The Decree applies to "commercial disputes", including disputes arising from distribution agency contracts if there is a commercial element.
UNCITRAL Model Law on Mediation (UNCITRAL Model Law on Mediation)and international conventions such as the Singapore Convention on international conciliation agreements
These international regulations are referenced to complete mediation procedures in Vietnam, especially in cases where international contracts choose foreign law or international mediation organizations.
For example, UNCITRAL sets rules on confidentiality, selection of mediators, termination of mediation, and enforcement of successful mediation agreements.
International contract terms need to clearly state applicable law and dispute resolution
In an international distribution agency contract, the parties should clearly stipulate the "applicable law" when the contract is signed — if not specified, international regulations and Vietnamese law will apply according to the Civil Code and Civil Procedure Code.
In addition, dispute resolution methods should be prescribed in the order: negotiation → conciliation → arbitration/court, to avoid being passive when a dispute arises.
Some important principles stipulated by Vietnamese law in Decree 22/2017/ND‑CP that businesses need to pay attention to:
Voluntarily: both parties must agree to mediation. Neither side is forced.
Equality: the rights and obligations of the parties must be guaranteed, without imposition.
Secret: information collected and exchanged during the mediation process is confidential, unless otherwise agreed or required by law.
The result of mediation was successfulmust be legal, not violate legal prohibitions, social ethics, and not aim to shirk obligations.
Below is the proposed process based on practice in Vietnam + guidelines governed by international law.
Check contracts & collect evidence
Find the mediation agreement in the contract (if any): see if the contract clearly stipulates commercial mediation, mediation organization, applicable law, language, and location of mediation.
Collect original contracts, appendices, delivery records, invoices, payment documents, letters/emails exchanged, evidence of violations (quality, quantity, slow delivery...), and damages incurred.
Assess legal position & risks
Determine applicable law — if the contract stipulates foreign law, otherwise according to Vietnamese law + international treaties (if any).
Evaluate the cost and time if you have to use arbitration or court compared to mediation.
Consider the impact on your long-term business relationship with your counterparty — mediation can preserve your reputation and improve your relationship.
Select the organization or mediator
Inside the country: use a commercial mediation organization in Vietnam or a mediator announced according to the list of the Department of Justice.
If the international contract has an agreement on a foreign organization or an international mediator, both parties can choose the appropriate person/organization.
Agreement on mediation costs, language used, location, and deadline.
Open reconciliation
One party sends a written request for conciliation to the other party, clearly stating the content of the dispute, grounds, and desired requirements.
Establish a mediation agreement if there is not one: a written confirmation of the mediation terms if not previously set out.
Mediation session
Integration through mediator: listen to the arguments of both sides, identify the real points of dispute.
Exchange opinions and come up with possible solutions. The mediator acts as an intermediary to support and regulate, but does not make decisions for him.
If there is a foreign element: consider language differences, foreign laws, jurisdiction, transfer of information across borders.
Agreement or concluding mediation
When conciliation is successful: the parties prepare a written conciliation agreement, clearly stating commitments, performance obligations, implementation deadline, and compensation (if any). This document will be binding on the parties.
If mediation fails: record the minutes of conciliation, and choose the next option (arbitration, court, or other methods if agreed upon).
The successful conciliation agreement document has legal value in civil relations between the parties.
In the 2015 Civil Procedure Code, Chapter XXXIII has provisions on recognition of out-of-court mediation results, so the party benefiting from the mediation results can request the court to issue a recognition decision for ease of enforcement.
If the other party does not comply with the written agreement, they can use evidence of the written agreement to request the court to enforce it.
Clearly state in the contract the terms of mediation
Applicable law, language, location, mediation organization, costs, and time limit for mediation. This helps avoid further disputes over how to resolve the dispute.
Cost & time
Mediation is often faster than arbitration and court. But if the other party is not ready to cooperate, the time can also be extended.
Mediation costs include mediator's remuneration + organizational costs, the parties should agree in advance.
Confidentiality & information security
Very important in international contracts, to ensure coordination with foreign laws, protect trade secrets, sensitive information.
Validity and enforcement of the conciliation agreement
There should be a clear commitment in the successful settlement agreement so that it can be recognized by the court if necessary.
Understand the court's rights and jurisdiction to enforce the agreement.
Skills of the mediator/mediation organization
Understand international trade law, Vietnamese law, industry characteristics, and cultural differences.
Have soft skills: listening, negotiating, conflict management.
Choose mediation first — preserve relationships & save risk
In fact, many international businesses prioritize mediation because they want to maintain their brand, relationships with agents and markets.
Mediation of international distribution agency contract disputes in Vietnam is a very practical solution: flexible, cost-saving, maintaining partnership relationships, faster than arbitration or court proceedings. However, to be successful, careful preparation is required: from a clear contract, complete evidence, choosing a good mediator, ensuring legal procedures, and an enforceable mediation agreement.
If you are business A, facing a dispute with an international distribution agent, look at the contract to see if there is a mediation clause. If not, immediately propose a mediation session, collect documents, and choose a reputable mediation organization. Don't let a small dispute become a big legal problem.
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