Unit 10: Arbitration

Created @March 29, 2023 2:52 PM

ậ ơ ố ộ ỹ
Legislative: L p pháp - c quan ban hành: qu c h i (congress - M , parliament -
Anh, national assembly - Vi t Nam) ệ
Executive: Hành pháp
ư
Judicial: T pháp
ọ
Neutral arbitrator: tr ng tài trung l p ậ
1. Introduction - Judicial system
1.1. US judicial system
3 branches of the US Federal Government:

ỹ ậ
Congress (M )/ Parliament (Anh)/ National Assembly (VN) → Legislative (l p
pháp)

President and Vice president (US)/ Prime Minister (UK/ VN) → Executive
(hành pháp)

Courts → Judicial (t pháp)ư

US judicial system:

Unit 10: Arbitration 1

 1.2. Vietnam judicial system

Unit 10: Arbitration 2

 Vietnam’s situation

“The commercial court system is non- ệ ố ươ ạ

functioning. The local arbitration system
has no power of enforcement and the
enforceability of arbitration under the
New York Convention of Foreign Arbitral
Award, to which Vietnam has acceded,
is untested”
H th ng tòa án th ng m i không ho t ạ
ộ ệ ố ọ ị ươ
đ ng. H th ng tr ng tài đ a ph ng
ề ộ ả
không có quy n ràng bu c và kh năng
ràng buộc của tố tụng trọng tài theo
Công ước Newyork về phán quyết của
trọng tài nước ngoài mà Vietnam tham
gia lại chưa được thông qua.

2. Arbitration terms - Glossary

The parties to a dispute sometimes choose to resolve a dispute through
arbitration rather than through court litigation. In arbitration, a dispute is resolved

Unit 10: Arbitration 3

 ọ ậ ẩ
by a neutral arbitrator(tr ng tài trung l p) rather than by a judge or jury (th m
phán).

Arbitration is generally quicker and cheaper than court litigation. Specially

qualified arbitrators are often used to resolve technical disputes.

Both parties must agree to submit their dispute to arbitration. Many contracts
require that disputes be resolved through arbitration rather than through litigation

💡 Definition:

A form of alternative dispute resolution (ADR),

Is a legal technique for the resolution of disputes outside the courts,

wherein the parties to a dispute refer it to one or more persons (the
"arbitrators"), by whose decision (the “award") they agree to be bound
ộ
(bound: ràng bu c các bên)

It is a settlement technique in which a third party reviews the case and

imposes a decision that is legally binding for both sides.

Characteristics:

Is most commonly used for the resolution of commercial disputes, particularly

in the context of international commercial transactions.

Has been the dominant force in dispute resolution in areas such as:

Shipping

Commodities, and

Construction

Takes place in private place, unlike litigation in the court.

Can be either voluntary or mandatory and can be either binding or non-

binding

ỏ ậ ọ ậ ữ ổ ế ể
Trong th a thu n tr ng tài, "binding" và "non-binding" là hai thu t ng ph bi n đ
ả ấ ủ ế ị ượ ư
mô t tính ch t c a quy t đ nh đ c đ a ra trong quá trình tr ng tài.ọ
Nếu một quyết định được xem là Ngược lại, nếu một quyết định được
"binding" trong trọng tài, điều đó có xem là "non-binding" trong trọng tài, thì
nghĩa là quyết định đó là ràng buộc và điều đó có nghĩa là các bên có thể tuân

Unit 10: Arbitration 4

 ả ủ ở
ph i tuân th b i các bên liên quan.
Nếu bất kỳ bên nào không tuân thủ, thì
bên kia có thể đưa ra các biện pháp thi
hành tại các tòa án để bảo vệ quyền lợi
của mình. Trong trường hợp này, quyết
định của trọng tài có giá trị tương
đương với một phán quyết của tòa án.
ủ ặ ủ ế ị
th ho c không tuân th quy t đ nh đó.
Trong trường hợp này, quyết định chỉ có
giá trị tham khảo và các bên có thể tiếp
tục đàm phán hoặc giải quyết tranh
chấp bằng các phương thức khác.

→ The role of mediation

Arbitration bodies try hard to get their standard arbitration clause put into
people contracts, so they have a captive market once disputes arise. They do
this by publicizing their activities and their rules.

Arbitration bodies may have a standard clause that they prefer parties to
include in their contracts, which outlines the basic terms and procedures for
arbitration. By having this clause included in contracts, the arbitration body
can avoid negotiating the terms of the arbitration agreement each time a
dispute arises, and instead rely on the pre-agreed terms.

By publicizing their activities and rules, the arbitration body can also
establish a reputation as a reliable and effective provider of arbitration
services. This can help to build trust and confidence in the arbitration
process among potential users, which may in turn lead to more business in
the future.

National legislation has to lend its support to such an important economic

activity as arbitration: The sentence means that national laws need to support
the important economic activity of arbitration.

Arbitration is an important economic activity because it provides businesses

with a means to resolve their disputes in a timely and cost-effective manner.
It can also help to preserve business relationships by allowing parties to
maintain confidentiality and control over the dispute resolution process.

To ensure that arbitration can function effectively as a means of dispute

resolution, national legislation must support it by providing a legal framework
for its use. This includes

enacting laws that recognize and enforce arbitration agreements and

awards

establishing procedures for the conduct of arbitration proceedings.

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 → help to promote a favorable business environment by providing a reliable and
efficient means of resolving disputes

→ help to attract investment and promote economic growth.

What people look for in an arbitration

Speed: Parties in a dispute want their issue to be resolved as quickly as

possible. Arbitration proceedings are typically less time-consuming than court
proceedings, and parties can often agree on a timeline for the process in
advance.

Cost-effectiveness: Arbitration can be less expensive than going to court

because it involves fewer procedural steps and less formalities. Also, arbitrators'
fees are generally lower than the legal fees of court litigation.

Confidentiality: : Parties often prefer the confidentiality of arbitration because

they can keep their dispute out of the public eye. Unlike court proceedings,
which are typically open to the public, arbitration hearings are usually private.

Reliability: Parties want to be assured that the arbitrator they select will be
knowledgeable, fair, and impartial. Arbitrators are often experts in a particular
field and selected based on their qualifications and experience, which can give
parties confidence in the outcome of the dispute resolution process.

Choice of venue

The choice of the venue (place) depends on 5 factors:

The availability of good experienced arbitrators

The availability of good experience lawyers, and expert witnesses such as

accountants and engineers

The cost of these people

The support that local legal system give to arbitration

Accessibility: flight access, goods facilities, administrative back-up, good

telecommunications, IT support, and climate

Advantages and Disadvantages

Advantages Disadvantages

Arbitration can be faster than If you get a bad decision from the
litigation: review the case and give arbitrator, there usually is nothing
decision while the litigation process

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 is sophisticated. The court need to
investigate the evidences.
Arbitration process is simple.
Arbitration can be cheaper than
litigation
Arbitration is less formal: less
formal because it takes place in
private while litigation in public
you can do about it (no appeals as
are allowed in litigation)
You may get stuck with a bad
arbitrator
You have less chance to really
investigate your case (through
discovery, which is typically broader
in litigation)

Arbitrators tend to be more Discovery means the opportunity to

sophisticated and knowledgeable discover information from the other side
than juries: because we have the in a dispute, such as through written
right to choose arbitrators who are questions or depositions.
experts in area having dispute while
the jury can not be chosen so the
chosen may be not expert in the
filed

You should negotiate the specifics of any arbitration clause. For example, you might
want to provide for three arbitrators instead of one or require that certain rules have
to be followed.
ự ế ọ
The enforcement of awards (th c thi phán quy t tr ng tài)

If both countries accept the major international convention on the enforcement of

awards (New York Convention): an arbitral award can be enforced through the
civil courts.

If the buyer comes from a country which has a poor reputation for enforcing
awards or if the country is not a signatory to the convention: the exporter should
be especially careful to ensure that payment is secured

3. Arbitration example
Arbitration clause of AAA

“Any controversy or claim arising out of or relating to this

contract, or the breach thereof, shall be settled by arbitration
administered by the American Arbitration Association in
accordance with its Commercial [or other] Arbitration Rules

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 [including the Optional Rules for Emergency Measures of
Protection], and judgment on the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction
thereof.”

“All disputes arising out of or in connection with the present

contract shall be finally settled under the Rules of Arbitration of
the International Chamber of Commerce by one or more
arbitrators appointed in accordance with the said Rules."

“All disputes arising out of or in relation to this contract shall be

finally settled by the Vietnam International Arbitration Centre
(VIAC) at the Vietnam Chamber of Commerce and Industry
(VCCI - Phòng th ương mại và công nghiệp Việt Nam) in
accordance with its Rules of Arbitration”.

Additionally, the parties may add the following provisions to the arbitration
clause:

(a) The number of arbitrators shall be one or three

One chosen by one party

One chosen by the other party
One chosen either by the parties or the two party-appointed arbitrators.

(b) The place of the arbitration shall be agreed by the parties or

determined by the arbitral tribunal;

As to disputes involving a foreign element, the parties may also make additions:

(c) The applicable law shall be agreed by the parties or determined by the
arbitral tribunal;

(d) The language of the arbitration shall be agreed by the parties or

determined by the arbitral tribunal

International bodies offer arbitration services today

The International Chamber of Commerce (ICC) in Paris

Rules promulgated by the ICC

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 The clause recommended by the ICC

The Regional Arbitration Center established by the United Nations

→ Main centers:

Main centres for international arbitration are: Paris (home of the International
ụ ể
Chamber of Commerce and its rules), London, Geneva, Stockholm (Th y Đi n),
New York, Hong Kong and Singapore.

Stockholm: east-west trade disputes

London: shipping & commodities (home of the London Court of International

Arbitration)

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