Commercial Disputes with Foreign Enterprises – Practical Experience from DEDICA
What is a commercial dispute with foreign elements and why is it complex?
This type of dispute arises when at least one of the following elements is present: one party is a foreign individual or legal entity; the transaction occurs abroad; or the contract involves foreign-based assets. Examples include export-import agreements or cross-border investment collaborations.
The key challenges include:
Jurisdiction determination: According to Article 30 of the Vietnamese Civil Procedure Code 2015, Vietnamese courts may accept jurisdiction if the parties agree to choose Vietnam or if the assets are located in Vietnam.
Applicable law: Foreign law may only be applied if it does not conflict with the fundamental principles of Vietnamese law.
Diverse resolution methods: These include negotiation, mediation, arbitration, or litigation — prioritized in the order of “amicable, quick, cost-saving.”
DEDICA’s Practical Experience
1. Drafting solid contracts – clear dispute resolution clauses
Before signing, DEDICA provides detailed consultation on:
Applicable law
Method of dispute resolution (international arbitration, Vietnamese courts)
Limitation period for filing lawsuits (2 years under the Commercial Law or 3 years under the Civil Code, as per contractual agreement)
Example: Company A signed a contract with a partner in Hong Kong, opting for arbitration at VIAC (Vietnam). When the partner breached the agreement, the arbitration clause enabled a fast and cost-effective resolution compared to court litigation.
2. Prioritizing negotiation and mediation – saving costs and protecting reputation
DEDICA promotes direct dialogue or mediation through international mediators. Case examples include:
A Vietnamese company was owed service fees in the EU. DEDICA coordinated with EU-based legal counsel to resolve the matter within two months, avoiding complex litigation.
A successful mediation between a Vietnamese company and a Canadian partner over imported raw materials concluded in three sessions, preserving the business relationship.
3. Ready for international arbitration – globally enforceable judgments
When negotiation fails, arbitration is the next strategic step. DEDICA recommends respected institutions such as ICC, VIAC, and CIETAC. The process includes:
Filing the request and selecting industry-specific arbitrators
Conducting proceedings confidentially and efficiently
Receiving an award that is enforceable in multiple countries
4. When using Vietnamese courts – comply with international procedural rules
If litigation in Vietnamese courts is necessary:
Confirm jurisdiction (Article 30 and 35 of the Civil Procedure Code in cases involving foreign elements)
Prepare thoroughly: verify overseas assets, conduct judicial entrustment procedures via the Ministry of Justice (which may be time-consuming)
Example: DEDICA represented a Vietnamese enterprise in a dispute against a Chinese partner. The court case lasted six months and resulted in recovering nearly 80% of the debt.
5. Development experience: risk management and global positioning
According to DEDICA and VNEconomy experts, businesses should:
Establish preventive legal frameworks: internal processes and standard contract clauses
Be prepared for negotiation and mediation when disputes arise
Consider arbitration when appropriate, or opt for Vietnamese courts if assets are based in Vietnam
Contact DEDICA Law Firm today for expert legal advice!
Phone: (+84) 39 969 0012 (We are available on WhatsApp, WeChat and Zalo)
Head Office: 144 Vo Van Tan Street, Vo Thi Sau Ward, District 3, Ho Chi Minh City, Vietnam
Hours: Monday–Friday (8:30 am – 6:00 pm)
Call us now or leave us a message to get advice. Initial consultation is free of charge.
