Dispute Resolution Process for International Transport Contracts in Vietnam

Sep 23

When Vietnamese businesses engage in international transport contracts, disputes may arise for various reasons — delayed delivery, damaged goods, payment issues, or unclear delivery conditions. To effectively handle these disputes, it is essential to understand the legal process, choose the appropriate dispute resolution method, prepare thoroughly, and be aware of key considerations. This article provides a comprehensive summary based on the latest sources and current practices in Vietnam.

1. Legal Basis and Options for Dispute Resolution

1.1 Applicable Laws and Regulations

Civil Code 2015: Provides general provisions on civil contracts with foreign elements, determines the applicable law, obligations, and rights of the parties.
Vietnam Maritime Code 2015: Regulates international maritime cargo transport, including responsibilities, risks, timelines, and liability levels in case of damage.
Commercial Law 2005: Governs international commercial relations, including the obligations of buyers and sellers, and transport fee calculation—if agreed upon.
Commercial Arbitration Law 2010: Applies when the contract contains an arbitration clause to resolve disputes.
Additionally, international treaties may apply if Vietnam is a member, or international transport practices may be considered. However, Vietnam has yet to fully adopt several widely-used maritime conventions such as the Hague, Hamburg, or Rotterdam Rules.

1.2 Common Methods of Dispute Resolution

Disputes arising from international transport contracts can be resolved through:

Negotiation & direct discussion: Preferred when parties remain cooperative and wish to maintain a long-term relationship. Saves time and costs.
External (or internal) mediation: A neutral mediator helps both parties find an amicable solution.
Commercial arbitration: If the contract includes an arbitration clause. Arbitration is often faster than court proceedings and allows the parties to choose the applicable law, venue, and language. In international logistics disputes, many companies prefer institutions such as the Vietnam International Arbitration Center (VIAC).
People’s Court: If there is no arbitration clause or arbitration is not suitable. Court decisions carry legal enforceability. The court will review jurisdiction, applicable law, evidence, and the procedural process.

2. Step-by-Step Dispute Resolution Process in Vietnam

Outlined below are the typical steps, based on Vietnamese law and practice, for resolving disputes in international transport contracts.

2.1 Initial Preparation

Identify the dispute & collect evidence: Clearly determine the dispute (e.g., missing goods, damage, late delivery, payment breach, transport risks, force majeure). Collect relevant documents such as the contract, delivery reports, bills of lading, invoices, quality certificates, inspection records, and photos/videos.
Review the contract: Focus on critical clauses like dispute resolution, applicable law, jurisdiction, language, limitation period for claims, and penalty clauses. Vague terms can increase litigation risks.
Estimate damages & check limitation periods: Calculate losses, shipping costs, and interest (if applicable). Verify the statutory time limit for filing claims, which may vary depending on the contract type (e.g., international air transport is governed by specific limitation periods under the Civil Aviation Law).

2.2 Choosing the Resolution Method & Filing a Claim

Decide on the resolution method:
- If there’s an arbitration clause, arbitration offers flexibility and faster procedures.
- If not, or if one party rejects arbitration, court proceedings are an alternative.
Prepare the claim/arbitration request:
- Include a clear statement of claims, legal grounds, and supporting evidence.
- Attach related documents collected during preparation.
- Demonstrate jurisdiction (i.e., arbitration clause validity, or court jurisdiction — particularly important in cross-border cases).
File the application:
- Arbitration: Submit to the agreed arbitration center and pay the arbitration fees.
- Court: File with the appropriate People’s Court. If documents are in a foreign language, provide translations. Pay court fees and comply with civil procedure requirements.

2.3 Proceedings, Hearings & Decisions

Jurisdiction and proceedings: The court will accept the case if it meets legal conditions. Arbitration centers will form an arbitration tribunal.
Mediation: Courts may offer mediation during litigation; arbitration may involve a pre-hearing conference to encourage settlement.
Hearings: Each side presents their arguments and evidence. Expert witnesses may be involved, especially if goods are damaged.
Issuing a decision or award: The court or tribunal issues a ruling or arbitral award detailing compensation, interest, costs, and whether the claim is upheld.

2.4 Enforcement, Appeals & Recognition

Appeals / counterclaims: If allowed, the losing party can appeal to a higher court or seek to set aside the arbitral award.
Recognition and enforcement:
- Domestic judgments → Enforced through civil enforcement agencies.
- Foreign arbitral awards → Must be recognized by a Vietnamese court for enforcement, based on the Commercial Arbitration Law and applicable international treaties.
Interim measures: If assets are at risk before a decision is made, a party may request emergency interim relief from the court or arbitrator.

3. Practical Considerations

3.1 Common Risk Points

Contracts lacking clear clauses on dispute resolution, applicable law, jurisdiction, and language can create future complications.
Insufficient evidence — e.g., missing bills of lading, invoices, delivery reports, or inspection records — makes it hard to prove damage or loss.
Delays in filing claims: Statutory deadlines may expire, especially in air transport disputes.
Conflicts in international law or practices: Without a clear choice of law, Vietnamese courts may apply the law of the jurisdiction most closely connected to the contract.

3.2 Preventive Measures

When drafting contracts: Always include specific dispute resolution clauses (court or arbitration, law, venue, language).
Clearly define responsibility for insurance, damage risks, and delivery issues.
Require proper documentation from carriers or freight forwarders — such as transport documents and proof of condition at departure and arrival.
Anticipate force majeure scenarios (natural disasters, wars, regulatory changes) and include corresponding risk-handling clauses.

4. Conclusion

Resolving disputes in international transport contracts in Vietnam can be complex due to factors like applicable laws, jurisdiction, evidence, and procedural variations between arbitration and courts. However, with careful preparation — clear contract drafting, proper documentation, and selecting the right dispute resolution path — businesses can significantly increase their chances of success and reduce the cost and duration of disputes.

If your company is facing a dispute in an international transport contract — and you’re concerned about protecting your interests or enforcing a judgment — don’t delay. Seeking professional legal counsel and preparing thoroughly from the outset is the most strategic way to safeguard your legal rights and business reputation internationally.