When a Vietnamese enterprise signs an office lease contract with a foreign party, any arising dispute requires more than just an understanding of civil or commercial law—it also involves knowledge of international treaties, conflict of laws, applicable jurisdictions, and cross-border dispute resolution. This article summarizes the most updated legal framework and offers guidance on how to effectively resolve office lease disputes with foreign businesses in Vietnam—while protecting your interests.

1. Legal Aspects to Consider in Office Lease Contracts with Foreign Enterprises

1.1. Determining a Contract with Foreign Elements

An office lease contract is considered to have foreign elements if at least one of the following applies:

One or both parties are foreign individuals or organizations;
The signing, execution, amendment, or termination of the contract takes place abroad;
The subject of the contract (leased premises, property, or right to use office space) is related to a foreign jurisdiction.

→ Determining foreign elements is crucial, as it directly affects the applicable law and jurisdiction for dispute resolution.

1.2. Applicable Law & International Treaties

Under Vietnam’s Civil Code 2015, parties may agree on the applicable law. In the absence of such agreement, Vietnamese law or relevant international treaties to which Vietnam is a party will apply.

If a foreign law is selected, it must not violate the fundamental principles of Vietnamese law, and its content must be identifiable. Otherwise, Vietnamese law will prevail.

2. Dispute Resolution Methods and Jurisdiction in Vietnam

2.1. Common Dispute Resolution Methods

Direct Negotiation
This is often the first step—low-cost, time-saving, and helps preserve business relationships if both parties act in good faith.
Mediation
Can be conducted directly between parties or with a third-party mediator/organization. Decree 22/2017/ND-CP on commercial mediation supports this approach.
Commercial Arbitration
Applicable if the contract includes an arbitration clause or if both parties agree post-dispute. Arbitration tends to be faster and more flexible than court litigation.
Court Litigation
Necessary when other methods fail or legal conditions require court intervention. Though it can be more costly and time-consuming, court decisions are enforceable under Vietnamese law.

2.2. Jurisdiction of Vietnamese Courts over Foreign-Related Disputes

General Jurisdiction (Article 469 of the Civil Procedure Code 2015):
Vietnamese courts have jurisdiction if the defendant is residing or has assets in Vietnam, or if the contract was executed in Vietnam.
Exclusive Jurisdiction:
Applies when the dispute involves real estate located in Vietnam—including leased office premises. In such cases, provincial-level courts typically have jurisdiction in first-instance proceedings.

3. Steps to Resolve Office Lease Disputes with Foreign Enterprises

3.1. Preparing Before a Dispute Arises

Draft a clear contract with specific clauses on dispute resolution: applicable law, arbitration vs. court, governing jurisdiction, penalty clauses, deposit terms, maintenance obligations, and return of premises.
Preserve all evidence: the lease agreement, handover minutes, invoices, maintenance records, emails, messages, and other related documents.
Establish jurisdiction (forum selection) early in the contract to avoid future complications.

3.2. Practical Steps When a Dispute Occurs

Negotiation / Mediation
Before initiating litigation or arbitration, send a notice of breach, suggest specific remedies, and set a compliance deadline. If unresolved, consider involving a professional mediator.

Choosing a Dispute Resolution Method

If there’s an arbitration clause, initiate arbitration under the Law on Commercial Arbitration.
If arbitration is not applicable, proceed with court litigation.

Litigating in Court

Choose the correct court with jurisdiction (typically provincial-level courts).
Submit a lawsuit with supporting documents: the contract, proof of breach, and specific damages.
Pay provisional court fees.
Attend mandatory mediation sessions if required by the court.
Proceed to trial, and appeal if necessary.

Judgment Enforcement
Enforcing court decisions can be difficult if the foreign party has no assets in Vietnam or there are barriers to judicial cooperation. It is crucial to plan for enforcement during the contract negotiation stage.

4. Practical Challenges & Solutions

Unclear Governing Law:
Ambiguity in law choice may lead to prolonged legal disputes. Foreign laws may not be recognized if they contradict Vietnamese public policy.
Foreign Party Rights in Vietnamese Proceedings:
Foreign entities may sue and be sued under equal protection but enforcing judgments may still face hurdles.
Judicial Assistance, Law Verification, and Cross-border Evidence:
These processes are often time-consuming and costly.
Language Barriers and Legal Translation Costs:
Misinterpretation and inconsistencies can lead to additional risks.

Solutions:

Clearly define applicable law and dispute resolution forums in contracts.
Prepare enforcement strategies early: identify assets, banking info, or guarantees.
Engage legal advisors with international expertise to draft contracts and prepare documentation.
For minor disputes, prioritize negotiation or mediation to reduce costs and maintain business ties.

5. Conclusion

Resolving office lease disputes with foreign enterprises in Vietnam requires:

Accurately identifying foreign elements and applicable law;
Understanding the jurisdiction of arbitration or courts;
Familiarity with civil litigation procedures and required evidence;
Managing practical challenges like enforcement and international law verification.

With thorough preparation, strategic legal guidance, and the right dispute resolution mechanism, businesses can minimize risks, protect their legal interests, and resolve disputes efficiently.

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Resolving Office Lease Disputes with Foreign Enterprises in Vietnam