2022 Handouts

INTRODUCTION TO LAW
TRAN THANH TAM (LL.M, PhD Candidate)

CONTACT INFORMATION
Lecturer: TRẦN THANH TÂM
Tranthanhtam.cs2@ftu.edu.vn
0918. 014. 246

COURSE INTRODUCTION
1. Course content
2. Course objectives
3. Reading materials
4. Teaching method
5. Learning method
6. Course assessment
1. COURSE CONTENT
1 Fundamentals of Law
2 Parties doing business in Vietnam
3 Fundamentals of Business Contract
4 Dispute Settlement
2. COURSE OBJECTIVES
1. Understand the current structure of the
Vietnamese legal system.
2. Grasp legal status of parties doing business in
Vietnam.
3. Distinguish different types of companies and
pros and cons of each corporate form.
4. Recognize valid business contracts.
5. Be capable of utilizing the regime of
commercial dispute resolution.
3. READING MATERIALS
• VIETNAMESE LEGAL DOCUMENTS:
1. LAW ON COMMERCE 2005
2. LAW ON ENTERPRISES 2020
2. CIVIL CODE 2015
3. VIETNAM COMMERCIAL ARBITRATION LAW
2010
4. OTHER BY-LAWS
4. TEACHING METHOD
• BASED ON THE LECTURES (HANDOUTS) GIVEN
TO STUDENTS
• SOCRATIC DIALOGUE
5. LEARNING METHOD
• LEGAL THINKING
• DISCUSSION
• GROUP PRESENTATION
• SELF - STUDY
6. COURSE ASSESSMENT
MARK (%) FORM OF ASSESSMENT
ATTENDANCE 10% ATTENDANCE CHECK
MID – TERM TEST 30% ASSIGNMENT +/ PRESENTATION
FINAL EXAM 60% WRITING TEST

(TRUE/FALSE STATEMENT +
SHORT ANSWERS + CASES)
BONUS POINTS
CHAPTER 1:
FUNDAMENTALS OF LAW
TRẦN THANH TÂM

(LLM, PhD Candidate)
OUTLINE
1. Definition of Law
2. Sources of Law
3. Categories of Laws
DISCUSSION
1. A restaurant guest is unhappy with the quality of service provided
during his meal. He complains to the manager and angrily demands
his money back, but his meal has been eaten. Is the guest legally
entitled to a refund?
2. An employee is arrested by the local police for driving under the
influence of alcohol. He is employed by the company as a van driver,
but was not on duty at the time of the arrest. Should the company
suspend his employment?
3. A director is presented with a bottle of rare and expensive wine as a
Christmas gift from the company’s business partner. Can she legally
accept the gift without threatening her employment status?
4. A franchise fastfood owner receives a letter from her franchisor
stating that the “casual Friday” dress code policy recently adopted
by the owner is in violation of the franchise agreement. Must the
owner change her policy?
12
DISCUSSION
• What is the importance of studying law to a
business student?
1. DEFINITION
• Law may be defined as a body of rules, created

by the state, binding within its jurisdiction and
enforced with the authority of the state through
the use of sanctions
2. Sources of law in Vietnam
đạo luậtt Constitution - Hiến pháp
Legislation Acts, Codes - Bộ luật
( Văn bản luật) National Assenlly ( Quốc hội)
Delegated Ordinances - pháp lệnh

Decrees - nghị định government
legislation Circulars - thông tư
( Văn bản dưới luật
-được ủy quyền )
Decisions - quyết định
official letter-công văn: văn bản qui phạm pháp luật--> Ko phải
luật.
15
3. Categories of Law
Law is a very large field, and it is common to

divide it into categories
• Criminal law and civil law luật hình sự vs luật dân sự

• Private law and public law luật tư vs luật công
• Common law and Civil law
thông luật vs dân luật (pháp luật châu âu lục địa)
• Substantive law and procedural law

luật về nd vs luật về tố tụng
16
CRIMINAL VS CIVIL LAW
CRIMINAL PROCEEDINGS CIVIL PROCEEDINGS
Purpose To punish the perpetrator of the crime; To seek a remedy for a
to deter others from committing the private wrong
same crime
Parties Public prosecutor prosecutes the Plaintiff sues the defendant
accused/defendant
Discretion to The discretion whether or not to initiate The discretion whether or
initiate an action an action lies with the state not to initiate an action lies
with the plaintiff
Burden of proof Public prosecutor must prove the case Plaintiff must prove case on
beyond reasonable doubt the balance of probabilities
Decision of the Guilty or not Guilty Liable or not liable
Court
Sanctions Jail sentence, fine, other Damages, specific
performance, injunctions,
other
DISCUSSION
1) Armed team broke into a bank; CRIMINAL
2) A works for a restaurant and the restaurant
failed to pay him salary for 2 months; CIVIL
3) A has his house for foreigners rent; CIVIL
4) A killed B for money; CRIMINAL
5) While driving the car beyond speed limits, A
crashed into B and made him injured; CIVIL
6) a married couple wanted to divorce CIVIL
7) Seller fails to deliver goods on time to buyer CIVIL
DISCUSSION
8) A customer got poisoned after having lunch in a
restaurant; CIVIL
9) Disagreeing with each other on how to share the
house left by a father, the two brothers fought each
other until death; CRIMINAL
10) Being much impressed by huge profit, A involved
in trafficking heroine;
11) A involved in trafficking newly born babies
abroad; CRIMINAL
CRIMINAL
12) A company makes his drinking products having
labels easy to confused with Lavie CIVIL
PENAL CODE 2015
Article 260. Offences against regulations on road traffic
1. Any person who violates regulations on road traffic safety
in any of the following cases shall be liable to a fine of
from VND 30,000,000 to VND 100,000,000 or face a
penalty of up to 03 years' community sentence or 01 - 05
years' imprisonment: a) The offence results in the death
of 01 person or bodily harm to 01 person who suffers
from ≥ 61% physical disability;…
2. If the offence results in bodily harm to 01 person who
suffers from 31% - 60% physical disability, or bodily harm
to 02 or more people who suffer from a total physical
disability of 31% - 60%, the offender shall be liable to a
fine of from VND 30,000,000 to VND 100,000,000 or face
a penalty of up to 03 years' community sentence.
Private Law and Public Law
• Private Law and Public Law are concerned

with relationships
21
Private Law
• Private Law deals with the relationships

between ordinary people in everyday
transactions
• That includes you and me, as well as
businesses and companies
22
Private Law
Individual Individual
Law regulates relationship

between them
23
Public Law
• Public Law deals with the relationships between
government organisations and ordinary citizens
– also between different government organisations
24
Public Law
State State Bodies
Individual
Law regulates relationship

between them
25
DISCUSSION
• Criminal law
• Constitutional law
• Administrative law
• Law of contract
• Tort law
• Property law
• Family law
• Company law
Common Law and Civil Law
• Common Law and Civil Law are terms used

to describe legal systems
• A legal system is the way the law is
structured and operated in a country
– England and Vietnam have different legal
systems
27
Common Law
• Common Law is used to describe legal

systems based on the English legal system
• These are usually countries which were
once part of the British Empire
– eg: America, Australia, New Zealand
28
Common Law
• One of the unique features of the common

law is that it is judge-made law.
• The judgments of courts operate not only
to resolve the particular dispute of the
specific parties before the court, but also
stand as precedents for the resolution of
future disputes of a similar nature
29
Common Law
• Case law is merely the rules of law

announced in court decisions. Case law
may consist of interpretations of statutes,
regulations and provisions in the
constitution.
• A precedent is a decision that furnishes an
example or authority for deciding
subsequent cases involving identical or
similar legal principles or facts.
30
Common Law
• The doctrine of Stare decisis - a Latin phrase

meaning “to stand on decided cases.”
• Stare decisis has two aspects:
1. A court should not overturn its own
precedents unless there is a compelling
reason to do so.
2. Decisions made by a higher court are
binding on lower courts.
31
DISCUSSION
• PROS AND CONS OF USING PRECEDENTS

• THE ROLE OF PRECEDENTS IN VIETNAM
32
CASE LAW IN VIETNAM
‘Precedents are arguments and rulings written on
effective judgments or decisions (hereinafter
referred to as judgment) of the courts that are
selected by the Judicial Council of the Supreme
People’s Court and published by the Chief Justice
of the Supreme People’s Court in order for other
courts to study and adopt them when deciding
later cases.’
(Art 1- Resolution No. 04/2019/NQ-HDTP on
process for selecting, publishing and adopting
precedents)
33
Civil Law
• Civil Law is used to describe legal systems which are based on old
Roman Law (from the Roman Empire in what is now Italy)
• It has been built on and consolidated, particularly in France, from the
18th century.
• Napoleon Bonaparte came to power after the French Revolution, which
commenced in 1789; as well as expanding the French Empire, he drew
up a detailed civil code to apply to the whole of France. By 1810, the
Civil Code, the Code of Civil Procedure, the Commercial Code, the Code
of Criminal Procedure and the Penal Code, together known as the Code
Napoléon, had become law.
• The use of the Napoleonic Code spread throughout much of Europe
and, although most nations have since drafted their own codes, and the
French Code itself has been revised, it has had a strong influence on the
current legal systems of civil law countries.
34
Civil Law
• The essential features of the system are:
1) Civil Laws are a codified set of legal rules.
2) The codified Law bears a binding for all. There is
little scope for judge-made law in civil courts. Yet,
looking into the practical aspect, the judges follow
the precedents.
3) Writings of the Legal Scholars do have a
substantial influence on the courts.
35
Common Law v. Civil Law
Below: A world map showing countries today that have a civil law system (light blue), countries that
have a common law system (green), and countries that have both (orange).
36
Substantive vs procedural law
• Substantive Law: Defines rights and

obligations
• Procedural Law: Establishes processes for

resolving disputes
37
LEGAL CULTURE
CHAPTER 2:
PARTIES DOING BUSINESS IN VIETNAM
READING MATERIALS
LEGAL DOCUMENTS
1. Law on Commerce 2005
2. Law on Enterprises 2020
3. Law on Bankruptcy 2014
4. Law on Investment 2020
OPTIONAL READINGS
1. Trương Nhật Quang (2016), Law on Enterprises – Fundamental issues (in
Vietnamese).
2. Phạm Hoài Huấn (2016), Law on Vietnam’s Enterprises – Cases – Explanation
& Comments (in Vietnamese).
I
II
II
1. DEFINITION
3.
FOREIGN
I. TRADER
TRADERS
IN
VIETNAM
2.
CONDITIONS
1. DEFINITION
• Art 5.6 Law on Commerce 1997:

“Traders shall be individuals, legal persons,
cooperatives, and family households having
business registration for commercial activities
which are carried out independently and
regularly.”
• Art 6.1 Law on Commerce 2005:
Traders include lawfully established economic
organizations and individuals that conduct
commercial activities in an independent and
regular manner and have business registrations
2. CONDITIONS FOR BEING A TRADER
Necessary Sufficient
2.1. NECESSARY CONDITIONS
1. Parties (individuals, organizations) shall

conduct commercial activities
2. Commercial activities are conducted
independently
3. Commercial activities are conducted
regularly
2.1. NECESSARY CONDITIONS
Commercial activities mean activities for the

purpose of generating profits, including: sale
and purchase of goods, provision of services,
investment, commercial promotion and other
activities for the profit purpose.
(Art 3.1 Law on Commerce)
2.2. SUFFICIENT CONDITIONS
→ The parties shall register their business

CEO, CHAIRMAN
3. FOREIGN TRADERS IN VIETNAM
3.1. Definition
3.2. Forms
3. FOREIGN TRADER IN VIETNAM
3.1. DEFINITION
“Foreign traders mean traders established and making

their business registrations according to the provisions of
foreign laws or recognized by foreign laws”
(Art 16.1 Law on Commerce)
3. FOREIGN TRADERS IN VIETNAM
3.2. FORMS OF FOREIGN TRADERS IN VIETNAM
+ Representative Office
(Art 3.6; 17; 18 Law on Commerce, Decree No. 72/2006/NĐ-CP)
+ Branch
( Art.3.7; 19; 20 Law on Commerce, Decree No. 72/2006/NĐ-CP)
REPRESENTATIVE OFFICE BRANCH
Art 3.6 – Law on Commerce 2005 Art 3.7 – Law on Commerce 2005
Vietnam-based representative office of a foreign Vietnam-based branch of a foreign trader means a dependent
trader means a dependent unit of the foreign unit of the foreign trader, which is established and conducts
trader, which is established under the provisions commercial activities in Vietnam under the provisions of
of Vietnamese law to conduct market survey Vietnamese law or treaties to which the Socialist Republic of
and a number of commercial promotion Vietnam is a contracting party.
activities permitted by Vietnamese law. Article 19.- Rights of branches
Article 17.- Rights of representative offices 1. To rent offices, rent and purchase equipment and facilities
1. To operate for the purposes, within the scope necessary for their operations.
and duration stipulated in their establishment 2. to recruit Vietnamese and expatriate employees to work for
licenses. them according to Vietnamese law.
2. To rent offices, rent and purchase equipment 3. To enter into contracts in Vietnam in compliance with their
and facilities necessary for their operations. operation contents specified in their establishment licenses
3. To recruit Vietnamese and expatriate and the provisions of this Law.
employees to work for them according to the 4. To open Vietnam dong accounts and foreign-currency
provisions of Vietnamese law. accounts at banks licensed to operate in Vietnam.
4. To open accounts in foreign currencies or 5. To transfer profits overseas according to the provisions of
foreign currency-based Vietnam dong at banks Vietnamese law.
licensed to operate in Vietnam, and to be
6. To have seals bearing their own names according to the
allowed to use those accounts solely for their
provisions of Vietnamese law.
operations.
7. To conduct activities of goods purchase and sale and other
5. To have seals bearing their names according
commercial activities in compliance with their establishment
to the provisions of Vietnamese law. 6. To have
licenses according to the provisions of Vietnamese law and
other rights as defined by law.
treaties to which the Socialist Republic of Vietnam is a
contracting party.
8. To have other rights provided for by law.
REPRESENTATIVE OFFICE BRANCH
Article 18.- Obligations of representative Article 20.- Obligations of branches
offices 1. To observe the accounting regime
1. Not to directly conduct profit-generating provided for by Vietnamese law; in
activities in Vietnam. cases where it is necessary to
2. To conduct commercial promotion activities apply another commonly used
within the scope permitted by this Law. accounting system, the approval
3. Not to enter into contracts, not to amend or by the Finance Ministry of the
supplement contracts already entered into Socialist Republic of Vietnam is
by foreign traders, except where chief required.
representatives obtain valid letters of 2. To report on their operations
authorization from foreign traders or other according to the provisions of
cases specified in Clauses 2, 3 and 4, Vietnamese law.
Article 17 of this Law. 3. To have other obligations provided
4. To pay taxes, fees and charges, and fulfil for by law.
other financial obligations provided for by
Vietnamese law.
5. To report on their operations according to
Vietnamese law.
6. To have other obligations as defined by
Vietnamese law.
DISCUSSION
1. What are similarities and differences

between Representative offices and
branches?
2. List forms of business made by foreign

traders in Vietnam
COMPANY LAW – AN OVERVIEW
1. HISTORY OF THE ENTERPRISE LAW IN VN

2. BASIC DEFINITIONS
3. LEGAL ISSUES ON BUSINESS NAME
1. HISTORY OF THE ENTERPRISE LAW IN VN
Forms of Prior to 2005 2005-2015 2015-2020 2021 onwards
Business
State-owned Law on State-

company owned company
Doanh nghiệp nhà nước
1995/2003
Law on Law on Law on
LLC
cty trách nhiệm hữu hạn Enterprises Enterprises Enterprises
JSC cty cổ phần
Law on Enterprises 2005 2014 2020
1999 (Company Law
Partnership and Law on Sole
cty hợp danh
Proprietorship was
Sole annulled)
Proprietorship
doanh nghiệp tư nhân
100% foreign-
owned Law on foreign
company investment in VN
cty 100% vốn đầu tư nc 1996 (amended in
ngoài
2000)
Joint venture
cty liên doanh
ENTERPRISE
BUSINESS
BUSINESS NAME
- ENTERPRISE
“Enterprise means an organization that has its own
name, assets, office, and is established or registered for
establishment in accordance with law to do business. ”
( Art 4.10 Law on Enterprises 2020)
ENTERPRISE – COMPANY?
- BUSINESS
‘Business means the continuous conduct of one, several
or of all of the stages of a process, from investment,
production to sale of products or provision of services on
the market for profit-making purposes.’
( Art 4.21, Law on enterprises 2020)

BUSINESS – COMMERCE ?
BUSINESS COMMERCE
‘Business means the ‘Commercial activities mean
continuous conduct of one, activities for the purpose of
several or of all of the stages of generating profits, including:
a process, from investment, sale and purchase of goods,
production to sale of products provision of services,
or provision of services on the investment, commercial
market for profit-making promotion and other activities
purposes.’ for the profit purpose.’
- Art 4.21, Law on enterprises - Art 3.1, Law on Commerce
2020 2020
BUSINESS NAME
Vietnamese Foreign Abbreviated

name name name
- BUSINESS NAME
(1) The Vietnamese name of an enterprise:
comprises two elements: Type of enterprise
loại hình doanh nghiệp
and proper name. tên riêng
+ The proper name must be written in letters in
the Vietnamese alphabets, the letters F, J, Z, W,
numerals and symbols.
- BUSINESS NAME
(2) The name of an enterprise in a foreign
language shall be the name which is translated
from Vietnamese into any of the foreign
languages in the Latin lettering system.
When translated into a foreign language, its
proper name may remain unchanged or may be
translated into such foreign language with a
corresponding meaning.
- BUSINESS NAME
(3) The abbreviated name of an enterprise

may be an abbreviation of its Vietnamese
name or its foreign language name.
3. LEGAL ISSUES ON BUSINESS NAME
Law on
Enterprises
2020 (Art
37 → 41)
PROHIBITED ACTS IN NAMING
ENTERPRISES TÊN TRÙNG TÊN GÂY NHẦM LẪN
1. Using names which are identical or confusingly

similar to the name of a registered enterprise.
2. Using the name of a state agency, people’s armed
forces unit, political organization, socio-political
organization, socio-politico-professional organization,
social organization or socio-professional organization
as the whole or part of the proper name of an
enterprise, unless it is consented to by such agency,
unit or organization.
3. Using terms and symbols which contravene national
historical traditions, culture, ethics and fine customs.
IDENTICAL NAMES
Identical names means that the Vietnamese name
of an enterprise requesting registration, when
written, is completely similar to the Vietnamese
name of a registered enterprise.
→ A & B Co.,Ltd - a & b Co.,Ltd???
CONFUSINGLY SIMILAR
TÊN TƯƠNG TỰ
luật doanh nghiệp điều 41, khoản 2 NAMES
a/ The Vietnamese name of an enterprise requesting

registration is pronounced the same as the name of a
registered enterprise;
b/ The abbreviated name of an enterprise requesting
registration is identical to the abbreviated name of a
c/ The foreign-language name of an enterprise requesting
registration is identical to the foreign-language name of a
d/ The proper name of an enterprise requesting registration
is different from the proper name of a registered enterprise
of the same type only by an ordinal number, a cardinal
number, a letter in the Vietnamese alphabet, or letters F, J, Z
or W written next to or spaced after the proper name of such
enterprise;
CONFUSINGLY SIMILAR
NAMES
dd/ The proper name of an enterprise requesting registration is
different from the proper name of a registered enterprise of the
same type only by the symbol "&" or "và", ".", "+", "-" and "_";
e/ The proper name of an enterprise requesting registration is
same type only by the word "tân" immediately preceding or the
word "mới" written next to or spaced after or before the proper
name of a registered enterprise;
g/ The proper name of an enterprise requesting registration is
same type only by one of the following expressions: "miền Bắc",
"miền Nam", "miền Trung", "miền Tây" and “miền Đông”;
h/The proper name of an enterprise is identical to the proper name
of a registered enterprise.
The cases prescribed at Points d, dd, e, g and h of this Clause do not
apply to subsidiaries of a registered enterprise.
2. FORMS OF ENTERPRISES UNDER
THE LAW ON ENTERPRISES 2020
2.1. Limited Liability Company (46 – 87)
2.1.1. Two or more members (46-73)
2.1.2. One member (74 – 87)
2.2. Joint-Stock Company (111 - 176)
2.3. Partnership (177 - 187) CTy hợp doanh
cty doanh nghiệp tư nhân
2.4. Sole Proprietorship (188 - 193)

2.5. Corporate group (194 - 197)
2.6. State-owned Company (88- 110)
2. FORMS OF ENTERPRISES BASED
ON LAW ON ENTERPRISES
- Characteristics:
+ Member
+ Member liability
+ Ability to issue shares
+ Legal entity status
- Finance (Capital contribution, Capital
Transfer, Profit contribution,…)
- Management Structure, legal representative
- Strengths, weaknesses of each kind of
enterprises
2.1. LIMITED LIABILITY COMPANY
WITH TWO OR MORE MEMBERS
2.1.1. CHARACTERISTICS
A) MEMBER
B) MEMBER LIABILITY
C) ABILITY TO ISSUE SHARES
D) LEGAL ENTITY
2.1.2. FINANCE
A) CAPITAL CONTRIBUTION
B) TRANSFER OF CONTRIBUTED CAPITAL AMOUNT
C) REDEMPTION OF CONTRIBUTED CAPITAL AMOUNT
D) ADJUSTMENT TO CHARTER CAPITAL
E) PROFIT DISTRIBUTION
2.1.3. MANAGEMENT STRUCTURE
2.1. LLC WITH TWO OR MORE
MEMBERS
A) MEMBER
- MAY BE ORGANISATION OR INDIVIDUALS
- QUANTITY: 2≤x≤50
(?) LESS THAN 2 & MORE THAN 50???

MEMBERS
B) MEMBER LIABILITY
“Members must be liable for the debts and other
property obligations of the enterprise within the
amount of capital contributed to the enterprise”
- Exception: Art 47.4: Committed capital?
cty TNHH
MEMBERS
C) ABILITY TO ISSUE SHARES
→ MUST NOT ISSUE SHARES except when it
converts to become a shareholding company.
→ WHY?
MEMBERS
D) LEGAL ENTITY
→ from the date of issuance of its Enterprise
Registration Certificate (ERC).Giấy chứng nhận hđ doanh nghiệp
→ (?) Contracts prior to business registration?
MEMBERS
2.1.2. FINANCE
A) CAPITAL CONTRIBUTION:
+ CONTRIBUTED ASSETS: ART 34
+ VALUATION OF CONTRIBUTED ASSETS: ART 36
+ TRANSFER OF OWNERSHIP OF CONTRIBUTED
ASSETS: ART 35
+ OBLIGATION OF CAPITAL DISTRIBUTION: Members must
contribute capital to the company in full and in the type of assets
as undertaken when registering establishment of an enterprise,
within a period of ninety (90) days from the date of issuance of
the ERC, excluding the duration of transporting or importing
assets contributed as capital and conducting administrative
procedures for conversion of ownership of assets.
DISCUSSION
A, B, C together established D Co.,Ltd.

Upon their agreement of capital
contribution, A committed to contribute 500
mil, B with 350 mil and C with his factory of
450mil. After that, C wants to contribute his
450-million car instead of his factory as
committed.
Is C allowed to change his type of
contributed assets? YES -> 27, Clause 2
DISCUSSION
On the due date, B contributed 200 mil (The

committed capital amount is 350mil).
- How to deal with the unpaid capital
amount? Art 47.3.C
Art 47.4
- Is B still the member of the company? If
yes, what is his liability? Art 47.3.b
Yes -> vẫn phải chịu trách nhiệm cho giá mik cam kết đầu tư (350M)
MEMBERS
(?) PROOF OF CAPITAL CONTRIBUTION:
→ Capital Contribution Certificate (Art 47.5)

MEMBERS
B. TRANSFER OF CONTRIBUTED CAPITAL AMOUNT
→ Restrictions: Art 51-52-53
→ Reasons for such restrictions?
DISCUSSION
X Co.,Ltd: A = 200mil, B=300mil, C=250 mil,
D=350 mil, E=150 mil. Charter capital amount =
1.250 bil.
C WANTS TO TRANSFER HIS CAPITAL
AMOUNT:
1: THE 4 REMAINING MEMBERS WANT TO
PURCHASE B’S CAPITAL AMOUNT
2: ONLY A AND B WANT TO PURCHASE
3: ONLY E WANTS TO PURCHASE
MEMBERS
C. REDEMPTION OF CONTRIBUTED CAPITAL
AMOUNT
- WHEN? ART 51.1, 53.4
- CONSEQUENCES?: tiền cty chuyển nhượng lại -> vốn điều lệ tăng
+ TERMINATION OF MEMBER STATUS
+ THE CHARTER CAPITAL WILL BE DECREASED
MEMBERS
D. ADJUSTMENT TO CHARTER CAPITAL (Art.68)
- INCREASE OF CHARTER CAPITAL: 2 POSSIBILITIES
+ Capital contribution of members is increased
+ Capital contributions are made by new members
- DECREASE OF CHARTER CAPITAL: 3 POSSIBILITIES
+ Return part of the contributed capital to members –
Conditions?
+ Redeem the members’ contributed capital amounts
+ The charter capital has not been paid in sufficiently
and timely
MEMBERS
D. PROFIT DISTRIBUTION (ART 69)
- 3 CONDITIONS
+ Generate profits
+ Fulfil taxes and other financial obligations
+ Ensure that all debts and other property
obligations may be fully paid after distribution of
profits
MEMBERS
2.1.3. MANAGEMENT STRUCTURE: Art 54
MEMBERS’ COUNCIL
DIRECTOR CONTROLLING BOARD

(GENERAL DIRECTOR)
REMARK: Company >=11 members: Controlling board is

compulsory. Company < 11 members : Controlling board is optional
MEMBERS
2.1.3. MANAGEMENT STRUCTURE: Art 54
MEMBERS’ COUNCIL
DIRECTOR CONTROLLING BOARD

(GENERAL DIRECTOR)
REMARK: State-owned LLCs and its subsidiaries: Controlling

board is compulsory. The remainder: Controlling board is optional
LEGAL REPRESENTATIVE
→ ART.12-15
→ ART 54.3
Người đại diện theo pháp luật
Enterprise Registration Certificate(ERC)
Giấy chứng nhận đăng ký doanh nghiệp
A. MEMBERS’ COUNCIL (ART.55)

- POSITION:
+ HIGHEST DECISION-MAKING BODY
+ COMPRISE ALL MEMBERS
- MEMBERS’S COUNCIL MEETING: ART 57
- RIGHTS AND OBLIGATIONS: ART 55.2
B. CHAIRPERSON OF MEMBERS’COUNCIL (ART 56)

- SHALL BE ELECTED BY THE MEMBERS’ COUNCIL
- MAY CONCURRENTLY ACT AS THE DIRECTOR OF
THE COMPANY
- THE TERM OF OFFICE: =<5 YEARS (WITHOUT
TERM LIMIT)
C. DIRECTOR/GENERAL DIRECTOR
- MANAGE THE DAY-TO-DAY BUSINESS OPERATION
OF THE COMPANY
- MAY CONCURRENTLY ACT AS THE CHAIRPERSON
OF THE COMPANY
- MAY BE THE LEGAL REPRESENTATIVE
- CRITERIA AND CONDITIONS: ART 64
D. CONTROLLING BOARD
- Rights and Obligations: Art 65.3

- Criteria and Conditions: Art 65.2
2.2. ONE-MEMBER LLC
- MEMBER
- MEMBER LIABILITY
- LEGAL ENTITY STATUS
- ABILITY TO ISSUE SHARES
2.2.2. FINANCE
- CAPITAL CONTRIBUTION
- CAPITAL WITHDRAWAL VÀ TRANSFER
- ADJUSTMENT TO CHARTER CAPITAL
2.2. ONE-MEMBER LLC
A. MEMBER: 01 MEMBER (INDIVIDUAL/ORGANISATION)
B. MEMBER LIABILITY:
→ liable for all debts and other property obligations of the
company within the amount of the charter capital of the
company.
C. LEGAL ENTITY STATUS:
→ from the date of issuance of the ERC
D. ABILITY TO ISSUE SHARES:
→ NOT ALLOWED except in a case of conversion to become
a shareholding company
2.2.2. FINANCE
A. CAPITAL CONTRIBUTION: IN FULL WITHIN THE

TIME LIMIT (ART.75)
B. CAPITAL WITHDRAWAL AND TRANSFER: ART 77
C. ADJUSTMENT TO CHARTER CAPITAL: ART 87
+ DECREASE OF CHARTER CAPITAL – CONDITIONS?
+ INCREASE OF CHARTER CAPITAL
INSTITUTIONAL OWNER INDIVIDUAL OWNER

PRESIDENT
Members’ council PRESIDENT
DIRECTOR DIRECTOR DIRECTOR
CONTROLLING BOARD CONTROLLING BOARD
REMARK: State-owned LLCs: Controlling board is compulsory. The remainder:

Controlling board is optional
2.3. JOINT-STOCK COMPANY
A. MEMBER
B. MEMBER LIABILITY
C. ABILITY TO ISSUE SHARES
D. LEGAL ENTITY STATUS
E. LEGAL ISSUES ON CHARTER CAPITAL
2.3.2. TYPES OF SHARES
2.3. JOINT-STOCK COMPANY
A. MEMBER:
- INDIVIDUAL, ORGANISATION
- MIN: 3, MAX: UNLIMITED
B. MEMBER LIABILITY: LIMITED LIABILITY WITHIN
THE CONTRIBUTED CAPITAL AMOUNT
C. ABILITY TO ISSUE SHARES: ALLOWED TO ISSUE
ALL KIND OF SHARES
D. LEGAL ENTITY STATUS: from the date it is
granted an ERC.
LEGAL ISSUES ON CHARTER CAPITAL

The charter capital is divided into equal portions
called shares
LEGAL ISSUES ON CHARTER
CAPITAL
DISTINGUISH:
+ CAPITAL STRUCTURE OF LLC WITH 2 OR MORE
MEMBERS:
CHARTER CAPITAL= T1 + T2+ …+ Tn ( n≤ 50)
+ CAPITAL STRUCTURE OF SJC:

LEGAL ISSUES ON CHARTER CAPITAL
CHARTER CAPITAL = TOTAL PAR VALUE OF SOLD

SHARES
AT THE TIME OF ESTABLISHMENT:

CHARTER CAPITAL = TOTAL PAR VALUE OF SHARES
REGISTERED FOR PURCHASE
Distinguish: Sold Shares – Shares allowed to be
offered – Unsold shares
D. TRANSFER OF SHARES (ART 127)
SHARES CAN BE FREELY TRANSFERED, EXCEPT FOR 3 CASES:
1. TRANSFER RESTRICTION STIPULATED IN THE COMPANY
CHARTER
2. VOTING PREFERENCE SHARES NOT ALLOWED TO

TRANSFER
3. ORDINARY SHARES OF FOUNDING SHAREHOLDERS
WITHIN 3 YEARS FROM THE DATE OF ISSUANCE OF ERC :
- B/W FOUNDING SHAREHOLDERS: FREELY TRANSFERRED
- OTHER SHAREHOLDERS/PERSON: APPROVED BY GMS
- REMARK: ART 120.4 LAW ON ENTERPRISES 2020
2.3.2. TYPES OF SHARES (Art 113)
2 TYPES:
ORDINARY SHARES: MANDATORY
PREFERENCE SHARES: OPTIONAL
- Each share of the same type must entitle its

holder to the same rights, obligations and
interests.
A. ORDINARY SHARES
- OWNER: INDIVIDUAL/ ORGANISATION
- TRANSFER: FREELY TRANSFERRED EXCEPT THE
CASES STIPULATED IN ART 120.3, 127.1
- VOTING: 1 ORDINARY SHARE = 1 VOTE
- CANNOT BE CONVERTED INTO PREFERENCE
SHARES
B. PREFERENCE SHARES
+ Voting preference shares;

+ Dividend preference shares;
+ Redeemable preference shares;
+ Other preference shares stipulated in the charter
of the company.
VOTING PREFERENCE SHARES

- PREFERENCE: MORE VOTES THAN A ORDINARY
SHARE
- 1 Voting Preference Share = n VOTE (n > 1,

CHARTER)
(n: THE QUANTITY OF VOTES)
VOTING PREFERENCE SHARE
- ‘A voting preference shareholder carries more votes than
an ordinary one’?
- VOTE CALCULATION: 3 Elements

+ TYPE OF SHARES ( VOTING PREFERENCE OR ORDINARY)
+ THE QUANTITY OF SHARES
+n=?
EXAMPLE: A= 100 ORDINARY SHARES, B = 10 VOTING
PREFERENCE SHARES
-n = 10: A = B
-n > 10: A < B
-n < 10: A > B
VOTING PREFERENCE SHARE
1. OWNER: FOUNDING SHAREHOLDERS +

ORGANISATIONS AUTHORIZED BY THE
GOVERNMENT (ART 116.1)
+ FOUNDING SHAREHOLDER: VALID FOR 3 YEARS +
CONVERTED INTO ORDINARY ONES
+ ORGANISATIONS AUTHORISED: UNLIMITED
→ why?
2. RESTRICTIONS: NON-TRANSFERABLE
DIVIDEND PREFERENCE SHARE
-PREFERENCE:
PAID AT A RATE HIGHER THAN THAT PAID FOR AN
ORDINARY STOCK OR AT AN ANNUAL FIXED RATE.
-RESTRICTION:
- HAVE NO RIGHTS TO VOTE, ATTEND THE GMS,
NOMINATE CANDIDATE TO THE BOARD OF
MANAGEMENT, CONTROLLING BOARD.
REDEEMABLE PREFERENCE SHARE
1. PREFERENCE: SHALL BE REDEEMED BY THE

COMPANY…
2. RESTRICTION:
HAVE NO RIGHTS TO VOTE, ATTEND THE GMS,
NOMINATE CANDIDATE TO THE BOARD OF
MANAGEMENT, CONTROLLING BOARD.
REMARK
AN ADDITIONAL PREFERENCE FOR DIVIDEND AND

REDEEMABLE PREFERENCE SHARES (Art.117.2.b)
Upon dissolution or bankruptcy of the company:
1. Redeemable preference shares
2. Dividend Preference shares
3. Voting Preference shares + Ordinary shares +
other type of shares
GENERAL MEETING OF
SHAREHOLDER MODEL 1
BOARD OF CONTROLLING BOARD

MANAGEMENT
DIRECTOR/
GENERAL DIRECTOR
CONTROLLING BOARD NOT MANDATORY: 2 CONDITIONS
- Quantity: < 11 shareholders
- Institutional shareholders own < 50% /Total shares
GENERAL MEETING OF
SHAREHOLDER MODEL 2
BOARD OF
MANAGEMENT
DIRECTOR/
GENERAL DIRECTOR
2 CONDITIONS
- 20% members of the B.M are independent members
- Auditing Committee is required in the B.M
GENERAL MEETING OF
SHAREHOLDER (ART.135)
- POSITION: HIGHEST DECISION-MAKING BODY
- COMPRISE ALL SHAREHOLDERS HAVING THE
RIGHT TO VOTE
- RIGHTS AND OBLIGATIONS: ART.138
- OTHER ISSUES: ART.139 → ART.152
BOARD OF MANAGEMENT
1. POSITION: THE BODY MANAGING THE COMPANY
- FULL COMPETENCE TO MAKE DECISIONS IN THE NAME OF
THE COMPANY…
2. QUANTITY:
3 ≤ n ≤ 11
3. TERM OF OFFICE:
+ MEMBERS OF B.M: UP TO 5 YEARS WITHOUT TERM LIMIT
4. CRITERIA, CONDITIONS
+ MEMBER OF B.M: ART 155.1
+ INDEPENDENT MEMBER OF B.M: ART 155.2
5. RIGHTS AND OBLIGATIONS: ART 153.2
BOARD OF MANAGEMENT
6. ADOPTING RESOLUTIONS OF THE B.M

- 1 MEMBER OF THE B.M = 1 VOTE
- PRINCIPLE OF VOTING
+ Majority Rule
+ In the event of a Tie vote: The vote of the chairperson is
decisive
DISCUSSION
- THE B.M HAS 5 MEMBERS: A (Chairperson), B, C,
D, E.
- 4 members attend the meeting to vote on the
dismissal of General Director H and G’s
appointment as new G.D. Results:
- A, B agree to dismiss H and appoint G
- C,D object to the dismissal and appointment
- E sends the vote by mail: “Object to the
dismissal of Mr H”
Who is the G.D? H or G?

AUDITING COMMITTEE – ART 161
1. POSITION
2. QUANTITY
3. RIGHTS AND OBLIGATIONS
DIRECTOR/GENERAL DIRECTOR
- TERM OF OFFICE: UP TO 5 YEARS (WITHOUT TERM
LIMITS)
- CRITERIA: ART 162.5
DISCUSSION
“ I AM CURRENTLY A DIRECTOR OF A JSC LOCATED

IN HCM CITY. I PLAN TO ESTABLISH A SUBSIDARY
COMPANY LOCATED IN HANOI. AM I ALLOWED TO
BE THE DIRECTOR OF THIS NEWLY-ESTABLISHED
COMPANY?
CONTROLLING BOARD
(ART.168 → ART.174)
- QUANTITY: 3 ≤ n ≤ 5, TERM OF OFFICE: UP TO 5
YEARS
- RELATIONSHIP WITH B.M/ G.D: INDEPENDENT
- CRITERIA AND CONDITIONS: ART.169
- RIGHTS AND OBLIGATIONS: ART.170
2.4. PARTNERSHIP
GENERAL PARTNER LIMITED PARTNER
MANDATORY OPTIONAL
INDIVIDUAL (WHY?) INDIVIDUAL/ORGANIS

ATION
MIN:2 – MAX: UNLIMITED
UNLIMITED
2.4. PARTNERSHIP
- MEMBER LIABILITY
GENERAL PARTNER LIMITED PARTNER
Liable for the liable for the debts of
obligations of the the partnership within
partnership with all of the limit of the capital
their assets amount they have
contributed to the
partnership
C. LEGAL ENTITY STATUS
LAW 1999 – LAW 2005 & 2014 & 2020
D. ABILITY TO ISSUE SHARES:
NOT ALLOWED TO ISSUE SECURITIES OF ANY
KINDS
Article 74 – Civil Code 2015
1. An organization shall be recognized as a juridical
person if it meets all of the following conditions:
a) It is legally established as prescribed in this Code
and relevant laws;
b) It has an organizational structure prescribed in
Article 83 of this Code;
c) It has property independent from other natural
and juridical persons and bears liability by
recourse to its property;
d) It participates independently in legal relations in
its own name.
2.4.2. MEMBERSHIP REGULATIONS
- Rights and obligations of G.P: Art 181

- Restrictions on rights of G.P: Art 180
- Termination of G.P Status: Art 185
- Admission of new partners: Art 186
- Rights and obligations of L.P: Art 187
RESTRICTIONS ON RIGHTS OF G.P: ART 180

- Not allowed to be the owner of a sole proprietorship or a
general partner of another partnership (Unless approved by
other general partners)
- Not allowed to conduct in his/her own name or in the
name of another person the same business lines as those of
the partnership for his/her personal benefits or for the
interests of another organization or individual
- Not allowed to transfer part or the whole of his/her capital
contribution in the partnership to another person without
the consent of other general partners.
Termination of G.P Status: Art 185

During 2 years after termination of general
partner status, the general partner, who either
voluntarily withdraws capital from the partnership
or has been excluded from the partnership, shall
still be jointly liable with all his/her assets for the
partnership’s debts which arise prior to the date
of termination of partner status.
ART 182
MEMBERS’ COUNCIL
CHAIRPERSON (MAY ACT

CONCURRENTLY AS
DIRECTOR/GENERAL DIRECTOR)
(UNLESS OTHERWISE PROVIDED BY THE CHARTER)
LEGAL REPRESENTATIVE OF THE PARTNERSHIP

- GENERAL PARTNERS: act as legal
representatives and organize management of
day-to-day business of the partnership
- CHAIRPERSON/DIRECTOR: Represent the
partnership in relationship with state agencies;
represent the partnership as defendant or
plaintiff in lawsuits, commercial disputes or
other disputes.
2.5. SOLE PROPRIETORSHIP
SOLE PROPRIETORSHIP = PRIVATE ENTERPRISE?
SOLE PROPRIETORSHIP VS STATE-OWNED

COMPANIES?
A. OWNER:
AN INDIVIDUAL
1 INDIVIDUAL = 1 SOLE PROPRIETORSHIP, WHY?
B. MEMBER LIABLITY:
Liable for all activities of the enterprise with all
his/her assets.
C. LEGAL ENTITY STATUS
D. ABILITY TO ISSUE SECURITIES
2.5.2. RIGHTS AND OBLIGATIONS OF
ENTERPRISE OWNERS
A. FINANCE
B. MANAGEMENT
C. LEASE OF ENTERPRISE
D. SALE OF ENTERPRISE
ENTERPRISE OWNERS
A. FINANCE (ART 189)

- Register the investment capital by
himself/herself.
- Reduce the investment capital below the
amount of investment capital registered only
after registration with the business registration
agency.
- Have total discretion in deciding on the use of
profits after payment of taxes.
ENTERPRISE OWNERS
B. MANAGEMENT - ART 190
- Have total discretion in making all business
decisions
- Act as the legal representative
- Director can be the owner or can be hired -
Liability?
ENTERPRISE OWNERS
C. LEASE OF ENTERPRISE: ART 191
- The owner of a private enterprise may lease his/her
whole enterprise provided that a written notice and
a notarized copy of the lease contract shall be sent
to the business registration agency and the tax
agency within 3 working days after the lease
contract becomes effective.
- During the lease term, the owner of the private
enterprise shall remain responsible before law as the
owner of the enterprise.
- The rights and responsibilities of the owner and
the lessee with respect to the business operations of
the enterprise shall be provided in the lease contract
ENTERPRISE OWNERS
D. SALE OF ENTERPRISE (ART 192)
- The owner may sell his/her enterprise to another
person.
- After selling his/her enterprise, the owner shall
remain liable for all debts and other property
obligations of the enterprise incurring before the
date of handing over the enterprise, unless
otherwise agreed by the purchaser, the seller and
creditors of the enterprise.
2.6. CORPORATE GROUPS
ECONOMIC GROUP, CORPORATIONS: ART 194

PARENT COMPANIES, SUBSIDIARIES: ART 195
RIGHTS AND RESPONSIBILITIES OF A PARENT
COMPANY TO ITS SUBSIDIARIES: ART 196
FINANCIAL STATEMENTS OF PARENT
COMPANIES AND SUBSIDIARIES: ART 197
3. ESTABLISHMENT – DISSOLUTION
- BANKCRUPTCY
3.1. ESTABLISHMENT AND MANAGEMENT OF ENTERPRISES (ART 17)
→INDIVIDUALS AND ORGANISATIONS…
EXCEPTIONS:
1. STATE AGENCIES… USING STATE ASSETS… TO MAKE PROFITS FOR THEIR OWN
ORGANISATIONS
2. PUBLIC OFFICIALS, PUBLIC EMPLOYEES…
3. OFFICERS, NON-COMMISSION OFFCERS…
4. MANAGERS, PROFESSIONAL MANAGERS IN STATE COMPANIES
5. MINORS; PERSONS WHOSE CIVIL ACT CAPACITY IS RESTRICTED OR LOST; PERSONS
WITH COGNITIVE DIFFICULTIES OR DIFFICULTIES WITH BEHAVIOURAL CONTROL;
ORGANIZATIONS WITHOUT LEGAL ENTITY STATUS;
6. PERSONS BEING EXAMINED FOR PENAL LIABILITY, SERVING PRISON SENTENCES;
OTHER CASES PRESCRIBED BY THE LAWS ON BANKRUPTCY AND CORRUPTION
PREVENTION AND COMBAT.
7. ORGANIZATIONS BEING COMMERCIAL LEGAL ENTITIES WHICH ARE PROHIBITED
FROM CONDUCTING BUSINESS OR OPERATING IN CERTAIN SECTORS PURSUANT TO
THE CRIMINAL CODE.
3.2. CAPITAL CONTRIBUTION
THOSE NOT ALLOWED TO CONTRIBUTE CAPITAL

- State agencies, units of people’s armed forces
using state assets to contribute capital to
enterprises to make profits for their own
organizations and units;
- Those who may not contribute capital to
enterprises in accordance with the law on
public officials and employees.
3.3. PROCEDURE FOR ENTERPRISE
REGISTRATION
- Enterprise registration authorities: Business
Registration Office - The Department of
Planning and Investment
- Documents and procedure for enterprise
Registration:
- Time limit for issuing certificate of enterprise
registration:
3.4. DISSOLUTION OF ENTERPRISES
Circumstances & conditions for dissolution?

ÓPoff its debts
Solvent = able to pay
What are scenarios that an enterprise shall be
dissolved?
Compulsory?
Voluntary?
3.4. DISSOLUTION OF ENTERPRISES
Procedures?
Is the dissolution initiatedÓP
by a resolution?
What is the order of payment of company debts?
When is the company deemed to be dissolved?
Prohibited activities?
3.5. BANKCRUPTCY OF
ENTERPRISES
When does a company fall into the state of bankruptcy?
Insolvent = unable to pay its debts when they fall due
VN: The Bankruptcy Law 2014
ÓP
Other jurisdictions: Insolvency Law
Will falling into the state of bankruptcy lead to the declaration of
bankruptcy (bring the business to an end)?
Winding up or liquidation involves the closing down of the business and
the realization of company assets for the benefit of creditors.
Thank You
CHAPTER 3:
BUSINESS CONTRACT
I. FUNDAMENTALS OF A CONTRACT
– Definition
– Essence of a contract
– Classifications of a contract
II. FEATURES OF A BUSINESS/COMMERCIAL
CONTRACT
– Party
– Object
– Purpose
– Form
– Governing law
III. OFFER AND ACCEPTANCE
I. FUNDAMENTALS OF
A CONTRACT
1. Definition
A contract is “a promise or a set of promises for
the breach of which the law gives a remedy, or the
performance of which the law in some way
recognizes as a duty”
(The US Restatement (Second) of
Contracts, Section 1).
→ a contract is an agreement that can be enforced
in court
1. DEFINITION
Contract means an agreement between parties in
relation to the establishment, modification or
termination of civil rights and obligations. (Art 385
–Vietnam Civil Code 2015)
Agreement
Parties (individual, organisation) CIVIL CONTRACT
Civil rights and obligations

2. ESSENCE OF CONTRACT
- Legal validity of a contract : Art 3.2 + Art 401.2
“…Any commitment or agreement which does not
violate a prohibition by law or is not contrary to
social morals is binding for performance by the
parties and must be respected by other parties.”
‘…From the time when a contract takes effect, the
parties must exercise the rights and perform the
obligations to each other as undertaken. The
contract may only be amended or cancelled as
agreed by the parties or as provided by law. .’
→ CONTRACT = LAW
3. CLASSIFICATION OF CONTRACT
• Bilateral vs Unilateral contract
• A bilateral contract is a contract whereby each
party has an obligation to the other.
• A unilateral contract is a contract whereby
only one party has an obligation.
• Principal vs Ancillary contract
• A principal contract is a contract the
effectiveness of which does not depend on
another contract.
• An ancillary contract is a contract the
effectiveness of which depends on a principal
contract.
• A contract for the benefit of a third person is
a contract whereby contracting parties must
perform obligations for the benefit of a third
person and the third person enjoys benefits
from such performance.
• A conditional contract is a contract the
performance of which depends on the
occurrence, modification or termination of a
specified event.
II. COMMERCIAL CONTRACT
• Parties: Art 2 – Law on Commerce
• Object: Art 3.2 – Law on Commerce
• Purpose: Art 3.1 – Law on Commerce
• Form: Art 24 – Law on Commerce
• Governing law: Art 4 – Law on Commerce
• Parties: Art 2 – Law on Commerce
‘Article 2.- Subjects of application

1. Traders conducting commercial activities as provided for
in Article 1 of this Law.
2. Other organizations and individuals conducting
commerce-related activities.
3. Basing itself on the principles provided for by this Law, the
Government shall specify the application of this Law to
individuals who independently and regularly conduct
commercial activities without having to make business
registration.’
• Object: Goods, service.
Art 3.2 – Law on Commerce
‘Goods include:
a/ All types of movables, including those to be formed
in the future;
b/ Things attached to land’
• Form: Art 24 & Art 74 – Law on Commerce
‘1. Contracts for sale and purchase of goods may be

expressed in verbal or written form or established
by specific acts.
2. For types of contracts for purchase and sale of
goods, which, as provided for by law, must be made
in writing, such provisions must be complied with.’
• Governing law: Art 4 – Law on Commerce
‘1. Commercial activities must comply with the

Commercial Law and relevant laws.
2. Particular commercial activities provided for in other
laws shall comply with the provisions of such laws.
3. Commercial activities which are not provided for in
the Commercial Law and other laws shall comply with
the provisions of the Civil Code.’
III. OFFER AND ACCEPTANCE
OFFER AND ACCEPTANCE
OFFER
+ CONTRACT
ACCEPTANCE
Forms:
- Offer + Acceptance = Contract
- Offer signed by both the seller and buyer =
Contract
1. OFFER
+ Civil Code 2015: Art.386 → Art. 397

+ CISG 1980: Art.14 → Art.24
Contract formation under the
CISG
OFFER ACCEPTANCE
• Form of acceptance (Art CONTRACT
• Criteria for an offer
18) • The time when the
(Art 14)
• Counter-offer (Art 19) contract is
• Withdrawal (Art 15)
• Time allowed for concluded (Art 23-
• Revocation (Art 16) 24)
acceptance (Art 20-21)
• Termination (Art 17)
• Withdrawal (Art 22)
1. OFFER
1. Criteria for an offer

2. Withdrawal and revocation of an offer
Criteria for an offer
1 - Việt Nam: Art 386 Civil Code
- CISG 1980: Art 14
CRITERIA FOR AN OFFER
Art 386.1 Vietnam Civil Code Art 14.1 CISG
Offer to enter into a contract A proposal for concluding a

means a clear expression by contract addressed to one or
the offeror of its intention to more specific persons constitutes
enter into a contract and to an offer if it is sufficiently definite
be bound by such offer made and indicates the intention of the
to another determined party offeror to be bound in case of
or to the public (hereinafter acceptance. A proposal is
collectively referred to as the sufficiently definite if it indicates
offeree). the goods and expressly or
implicitly fixes or makes provision
for determining the quantity and
the price.
REMARKS
• Mass distribution of a catalogue of
merchandise
• Brochures
• Advertisement
→ INVITATION TO TREAT?
ART 14 VS ART 55 – OPEN PRICE
CONTRACT
‘Where a contract has been validly concluded
but does not expressly or implicitly fix or
make provision for determining the price, the
parties are considered, in the absence of any
indication to the contrary, to have impliedly
made reference to the price generally charged at
the time of the conclusion of the contract for
such goods sold under comparable circumstances
in the trade concerned.’
ART 14 VS ART 55 – OPEN
PRICE CONTRACT
Case law:
In the majority of cases, the courts and arbitral
tribunals came to the conclusion that a contract
had been formed while in rare cases a different
result was reached
WITHDRAWAL AND
2 REVOCATION
- CISG: Art 15.2, Art 16
- VN: Art 389, Art 390 Civil Code
Art 15.2 CISG Art 16 CISG
An offer, even if it is (1) Until a contract is concluded an
irrevocable, may be offer may be revoked if the
withdrawn if the revocation reaches the offeree
withdrawal reaches the before he has dispatched an
offeree before or at the acceptance.
same time as the offer. (2) However, an offer cannot be
revoked:
(a) if it indicates, whether by
stating a fixed time for acceptance
or otherwise, that it is irrevocable;
or
(b) if it was reasonable for the
offeree to rely on the offer as
being irrevocable and the offeree
has acted in reliance on the offer.
WITHDRAW REVOKE
OFFER REACHES DISPATCHES ACCEPTANCE
2 EXCEPTIONS ( Art.16.2)
ART 389 CIVIL CODE ART 390 CIVIL CODE
An offeror may modify or An offeror may revoke the offer
withdraw an offer to enter into to enter into a contract if such
a contract in the following right was specified in the offer
cases: and the offeree receives the
(a) The offeree receives notice notice of revocation of the
of modification or withdrawal offer prior to the offeree
of the offer prior to or at the providing a notice of
same time as receipt of the acceptance of the offer to
offer; enter into the contract.
(b) The offeror clearly specified
the circumstances in which the
offer could be modified or
withdrawn and such
circumstances have in fact
arisen.
2. ACCEPTANCE
+ CISG 1980: Art.14 → Art.24
+ Civil Code 2015: Art.386 → Art.397

2. ACCEPTANCE
1. the offeree shall accept the entire

content of the offer
2. the acceptance must be received
within the time limitation set forth in
the offer
3. the acceptance shall not be withdrawn
The offeree shall accept the
1 entire content of the offer
- Civil Code 2015: Art 392, 393

- CISG 1980: Art.19.2; Art.19.3
Article 392 Amendment of offer Art 19 CISG
proposed by offeree (1) A reply to an offer which purports to
be an acceptance but contains additions,
When an offeree accepts the offer to limitations or other modifications is a
enter into a contract but specifies rejection of the offer and constitutes a
conditions or amendments to the offer, counter-offer.
the offeree shall be deemed to have (2) However, a reply to an offer which
made a new offer. purports to be an acceptance but
contains additional or different terms
which do not materially alter the terms
of the offer constitutes an acceptance,
Art 393 Acceptance of offers to enter into unless the offeror, without undue delay,
contracts objects orally to the discrepancy or
dispatches a notice to that effect. If he
does not so object, the terms of the
1. Acceptance of an offer to enter into a contract are the terms of the offer with
contract means a reply by the offeree the modifications contained in the
accepting the entire contents of the acceptance.
offer. (3) Additional or different terms relating,
among other things, to the price,
→ ‘Mirror image’ rule payment, quality and quantity of the
goods, place and time of delivery, extent
of one party's liability to the other or
the settlement of disputes are
considered to alter the terms of the offer
materially.
THE ACCEPTANCE MUST BE
2 RECEIVED WITHIN THE TIME
LIMITATION SET FORTH IN THE
OFFER
- CISG: ART.18, ART.21

- VN: ART 394
FORMS OF ACCEPTANCE
- Written forms
- Oral form
- Performing an act
- SILENCE = ACCEPTANCE?
+ CISG (Art 18.1)
+ VN (Art 393 Civil Code)
DISCUSSION
A requests B to set out the conditions for the
renewal of a contract for the supply of wine, due
to expire on 31 December. In its offer B includes
a provision stating that “if we have not heard
from you at the latest by the end of November,
we will assume that you have agreed to renew
the contract on the conditions indicated above”.
Discuss.
DISCUSSION
Under a long-term contract for the supply of
wine B regularly met A’s orders without
expressly confirming its acceptance. On 15
November A orders a large stock for New Year. B
does not reply, nor does it deliver at the
requested time.
Discuss whether B is in breach.
The acceptance shall not be
3 withdrawn
- VN: Art 397 Civil Code
- CISG: Art 22
DISCUSSION
The Polish seller (Y) sent an offer to the
Vietnamese buyer (X). The offer is valid until
30th May.
26/5: X accepted the offer on one condition –
that Y might reduce the price
29/5: X accepted the entire content of the initial
offer
27/5: Y concluded the contract with another
buyer.
X claims for damages.
BUSINESS CONTRACT
I. VALIDITY OF A CONTRACT
– Definition
– Essence of a contract
– Classifications of a contract
REQUIREMENTS FOR A
VALID CONTRACT
1. Parties to the contract [Capacity]
2. Voluntary consent of the parties
3. Purpose and Content of the contract
[legality]
4. Forms of the contract
Art 117 – Civil Code
1. PARTIES TO THE CONTRACT
- The parties have civil legal capacity and

capacity for civil acts appropriate to the
established civil transaction.
Legal capacity: Individuals (Art 16 -18 Civil Code)
• The civil legal capacity of an individual means the
capability of the individual to have civil rights and civil
obligations.
• All individuals have equal civil legal capacity.
• The commencement and termination of the civil legal
capacity
• The civil legal capacity of an individual may not be
restricted, except where otherwise provided by this
Code or other relevant laws.
Legal capacity: Legal entities (Art 86 Civil Code)
• The civil legal capacity of a legal entity means the
capability of that entity to have civil rights and
obligations.
• Civil legal capacity of legal entities is unrestricted,
except where otherwise prescribed by this Code or
other relevant laws.
• The commencement and termination of the civil
legal capacity of a legal entity?
Civil Capacity: Individuals

• The age of majority
• Minors
– Age 15 – Under 18
– Age 6 – Under 15
– Under 6
2. VOLUNTARY CONSENT
• Absence of free will:

– Deception and Duress (Art 127 Civil Code)
– Mistake (Art 126 Civil Code)
2. VOLUNTARY CONSENT
The cow was Rose 2d of Aberlone, a gentle animal that lived in
Michigan. Rose’s owner, Hiram Walker & Sons, had bought her
for $850. After a few years, the company concluded that Rose
could have no calves. As a barren cow she was worth much
less, so Walker contracted to sell her to T.C. Sherwood for $80.
But when Sherwood came to collect Rose, the parties realized
she was pregnant.
1. Walker refused to part with the happy mother, and
Sherwood sued. Is the contract voidable?
2. Suppose Walker sold Rose thinking that the price of beef
was going to drop, when in fact the price rose 60 percent in
five months. Is the contract voidable?
3. PURPOSE AND CONTENT OF
THE CONTRACT
→ Not contrary to the law or social morals.
• Purpose of the contract: Art 118
• Content of the contract: Art 398
• Legal prohibitions or contravention of social
morals: Art 123
4. FORMS OF THE CONTRACT
Legal basis: Art 119 Civil Code; Art 24 + 74

Commercial law
Verbal
In Writing
Specific acts
In Writing + notarized/certified?
VOID CONTRACTS
• When? Art 122
• Classification
– Art 130
– Art 129
• Legal consequences
IV. REMEDIES FOR BREACH
OF THE CONTRACT
IV. REMEDIES FOR BREACH OF THE
CONTRACT
1. Exemptions for non-performance
2. Remedies for breach of the contract

1. EXEMPTIONS FOR NON-PERFORMANCE
- Vietnam’s law:
+ Law on Commerce: Art 294-295-296
+ Civil Code: Art 156.1; Art 351.2
- CISG: Art 79, Art 80
- PICC 2016: Art 7.1.7

ART 294 – LAW ON COMMERCE
+ A case of liability exemption agreed upon by the

parties
+ Force majeure event (Compared to Art 79.1 CISG)
+ A breach by one party is entirely attributable to the
other party's fault (Compared to Art 79.2)
+ A breach is committed by one party as a result of the
execution of a decision of a competent state
management agency which the party cannot know, at the
time the contract is entered into.
FORCE MAJEURE
 Art 156.1 Civil Code 2015: An event of force
majeure is an event which occurs in an objective
manner which is not able to be foreseen and
which is not able to be remedied by all possible
necessary and admissible measures being taken.
 Art 79.1 CISG 1980: A party is not liable for a
failure to perform any of his obligations if he
proves that the failure was due to an impediment
beyond his control and that he could not
reasonably be expected to have taken the
impediment into account at the time of the
conclusion of the contract or to have avoided or
overcome it or its consequences.
COVID-19 AND FORCE MAJEURE
The Buyer (Neitherlands) and Seller (China) entered into an L-Lysine sales
contract on 20 June 2003.
Quantity: 289 ton
Price: USD 11,750 per ton, FOB Shanghai
Delivery time: July – December 2003
The Seller only delivered 289 ton goods between July and October of 2003, and
did not deliver the rest of the goods, which is 156 ton.
The Buyer informed the Seller to cancel the 156 ton undelivered goods and
request the Seller to take all the responsibilities thereof.
It is noted that SARS happened in China in April and was not under control until
by June 2003.
Seller’s arguments: During the contract, SARS happened in China, which
influenced the production and operation of the Seller, thus the Seller could not
perform the contract and are excused for such non-performance.
Could the seller be exempted due to the Force Majeure caused by SARS?
REMARKS (ART. 295 LAW ON COMMERCE 2005)

• The party must promptly notify in writing the
other party of cases of liability exemption and
possible consequences thereof.
• Provide the evidence from qualified authority
• Comparisons: Art 79(4) CISG

Effects of exemptions on the rights and duties of

the parties
• Not liable for damages resulting from non-
performance
• Comparisons: Art 79(5) CISG
FORCE MAJEURE vs HARDSHIP
• Hardship: Art 420 – Civil Code

1. The change of circumstances shall be deemed fundamental
when it meets all following conditions:
a) The circumstances change due to objective reasons occurred
after the conclusion of the contract;
b) At the time of concluding the contract, the parties could not
foresee a change in circumstances;
c) The circumstances change such fundamentally that if the parties
know in advance, the contract has not been concluded or are
concluded, but with completely different content;
d) The continuation of the contract without the change in the
contract would cause serious damage to one party;
dd) The advantaged party has adopted all the necessary measures
in its ability, in accordance with the nature of the contract, cannot
prevent or minimize the extent of effect.
Effect of Hardship: Art 420 – Civil Code

2. In the case of basic circumstances change, the advantaged
party may request the other party to the re-negotiate the
contract in a reasonable period of time.
3. If the parties cannot reach an agreement on amending the
contract within a reasonable period of time, any of the parties
may request a court to:
a) Terminate the contract at a specific time;
b) Adapt the contract with a view to restoring its equilibrium
The court may only decide to adapt the contract in the event
that the termination of the contract would cause greater
damage than the cost to perform the contract if it is adapted
2. REMEDIES FOR BREACH OF
CONTRACT
• Remedies available to the injured party under the
general contract law
payment
Buyer Seller
goods
• Contractual parties fully perform their obligations and
gain the benefits they bargained for.
• If a party fails to perform part or all of the required
duties under the contract, then breach of contract
occurs. The other party cannot get the benefits it
bargained for.
2. REMEDIES FOR BREACH OF
CONTRACT
• What types of breach of contract are there?
Non-performance, delayed performance and
defective performance.
• What are the buyer’s remedies for the seller’s
breach?
• What are the seller’s remedies for the buyer’s
breach?
2.3. COMMON REMEDIES FOR BREACH THE
CONTRACT
- Specific performance (Art 297→299 Law on

Commerce – Art 28; 46→48; 62→63 CISG)
- Penalty (Art 300-301 Law on Commerce)
- Damages (Art 302→306 Law on Commerce;
Art 74 → 77 CISG)
- Avoidance of the contract (Đ312 →315 Law
on Commerce; CISG: [49(1); 51(2); 64(1); 74;
73; 81-84]
SPECIFIC PERFORMANCE
(1) The seller has made non-delivery/delivered a part of goods

(2) The seller has delivered non-conforming goods
(3) The buyer failed to pay or take delivery
-- A grace period to be given for the buyer/seller to perform their

obligations (Art 298 VN Commercial Law; Art 47 CISG)
-- What happens if they fail to perform within the given grace
period? (Art 299.2 VN Commercial Law; Art 49.1b and Art
64.1.b CISG)
SPECIFIC PERFORMANCE
• Relationships with other remedies

• ART 299 LAW ON COMMERCE 2005
• ART 48; 63 CISG
PENALTY
• Penalty means a remedy whereby the aggrieved
party requests the breaching party to pay an
amount of fine for its breach of a contract, if so
agreed in the contract (Art 300 – Law on
commerce 2005)
PENALTY
• “The fine level for a breach of a contractual
obligation or the aggregate fine level for more than
one breach shall be agreed upon in the contract by
the parties but must not exceed 8% of the value of
the breached contractual obligation portion.”
(Art 301 Law on Commerce 2005 )
Exceptions:
+ Art 266 Law on Commerce 2005
+ Art 146.2 Law on Construction 2014
Compare: Art 418 Civil Code 2015
PENALTY
• Art 146.2 Law on Construction 2014
‘For works using state funds, the fine level must not
exceed 12% of the value of the violated contract’
ART 418 CIVIL CODE
Article 418. Agreements on fines against violations
1. Agreements on fines for violations are reached by the parties to a contract which requires the
violating party to pay a fine to the aggrieved party.
2. The fine levels shall be agreed among the parties, unless otherwise prescribed by relevant
laws.
3. The parties may reach an agreement that the violating party has to pay only a fine for violations
and is not liable to any compensation for damage,or has to pay both a fine for violations and a
compensation for damage. In case the parties have an agreement on fines against violation which
does not specify that the violating party has to pay both a find for violations and a compensation
for damage, then the violating party has to pay only the fine for violations.
PENALTY
RELATIONSHIPS WITH OTHER REMEDIES

- Art 307 Law on Commerce 2005
- Art 418 Civil Code 2015
ART 418 CIVIL CODE
Article 418. Agreements on fines against violations
1. Agreements on fines for violations are reached by the parties to a contract which requires the
violating party to pay a fine to the aggrieved party.
2. The fine levels shall be agreed among the parties, unless otherwise prescribed by relevant
laws.
3. The parties may reach an agreement that the violating party has to pay only a fine for violations
and is not liable to any compensation for damage,or has to pay both a fine for violations and a
compensation for damage. In case the parties have an agreement on fines against violation which
does not specify that the violating party has to pay both a find for violations and a compensation
for damage, then the violating party has to pay only the fine for violations.
DAMAGES
“ Liability to pay damages shall arise upon existence
of all of the following elements:
1. Breach of the contract;
2. Material loss;
3. Act of breaching the contract is the direct cause
of the loss.”
(Art 303 Law on Commerce 2005)
DAMAGES
CLASSIFICATION OF DAMAGES
• Loss suffered by the other party as a consequence

of the breach
• Loss of profit
DAMAGES
Principles of claiming damages
• The party claiming damages must bear the burden of

proof of the loss
• A party claiming damages must take such measures
as are reasonable in the circumstances to mitigate
the loss
DAMAGES
RELATIONSHIP WITH OTHER REMEDIES

• Art 307 Law on Commerce 2005
• Art 419 Civil Code 2015
• Limitation of damages clause/liquidated
damages clause: Art 419 & 360 Civil Code
ART 360 – CIVIL CODE 2015
‘Where there is any loss and damage resulting from

a breach of an obligation, the obligor must
compensate for the total loss and damage, unless
otherwise agreed or provided by law.’
ART 419 – CIVIL CODE 2015
1. The damage to be compensated for breach of contractual obligations is determined in
accordance with Clause 2 of this Article, Article 13 and Article 360 of this Code.
2. The obligee may demand compensation for damage to its supposed benefits that will be
enjoyed by the contract offer. The obligee also may request the obligor to pay the costs
incurred due to its non-fulfillment of contractual obligations which do not overlap with the
compensation for damages for contractual benefits.
3. At the request of the obligee, a court may compel the obligor to pay spiritual damages to
the obligee. The damages shall be decided by the court according to contents of case.
AVOIDANCE OF THE CONTRACT
• Law on Commerce 2005: Art 312 → Art 315
• CISG: 49(1); 51(2); 64(1); 74; 73; 81-84
AVOIDANCE OF THE CONTRACT
• Fundamental breach:
+ CISG: Art 25
+ Law on commerce: Art 3.13
ART 3.13 LAW ON COMMERCE
Fundamental breach means a contractual
breach by a party, which causes damage to the
other party to an extent that the other party
cannot achieve the purpose of the entry into the
contract.
AVOIDANCE OF THE
CONTRACT
• Effects of avoidance:
+ CISG: Art 81-84
+ Law on commerce: Art 314
CHAPTER 4:
DISPUTE RESOLUTION
READING MATERIALS
1. Law on Commerce 2005

2. Law on VN Commercial Arbitration 2010
3. Civil Procedure Code 2015
4. Decree No. 22/2017/NĐ-CP on
commercial mediation
4. New York Convention 1958
5. ICC Arbitration Rules
6. VIAC Arbitration Rules (Effective on
01/3/2017)
READING MATERIALS
1. Richard Schaffer, Filiberto Agusti and

Lucien Dhooge (2014) - International
Business Law and Its Environment (See
Chapter 3 – p.56-80)
2. Ray August, Don Mayer and Michael
Bixby (2013) International Business
Law: Text, cases and readings (See
Chapter 3- p.127-181)
3. Indira Carr and Peter Stone (2018),
International Trade Law (See Chapter 19
– p.629-652; chapter 20- p.654-669)
4. Nguyễn Thị Mơ, Law for doing
business abroad (2012) (See Chapter 6)
NEGOTIATION
CON- MEDIATION
TENT
LITIGATION (COURTS)
ARBITRATION
I. NEGOTIATION
1.1. Definition
1.2. Advantages and Disavantages
1.3. Remarks
1.1. DEFINITION
Negotiation is the process of reaching an

agreement by discussion
1.3. REMARKS
“Commercial disputes must be first resolved

through negotiations between the
parties…Where negotiation or conciliation
fails, commercial disputes may be resolved by
an arbitration body or a court.’’
( Art 239 Law on Commerce 1997)
→ NEGOTIATIONS ARE MANDATORY
1.3. REMARKS
Law on Commerce 2005:
• Art 237.1.e
• Art 40.2
1.3. REMARKS
- Time limit for negotiation/complaints?
Art 318 – Law on Commerce

II. MEDIATION
1. Definition:
Mediation involves the use of a third party
who transmits and interprets the
proposals of the principal parties and
sometimes advances independent
proposals
II. MEDIATION
2. Features:
• Non-binding, voluntary, conciliatory
• Both parties must be willing to be

assisted by an independent party
• Always reserve the right to other

courses of action
III. LITIGATION
A dispute between the parties is taken to

court through the commencement of a
lawsuit
III. LITIGATION
• Remember the 5 issues of litigation

with foreign parties:
1. It can take a long time

2. It is complicated
3. It is expensive
4. Be ready for anything to happen
5. Nothing is guaranteed (‘I can’t lose’)
Legal Names of disputing Parties
CRIMINAL LAW CIVIL LAW
• Prosecution(R) • Plaintiff
• Accused • Defendant
• Appellant
• Respondent
237
Parties
• Plaintiff commences the lawsuit
• Respondent defends the lawsuit

Litigation
• Plaintiff vs. Respondent
• Claim by Plaintiff against Respondent
• Demands relief, i.e. damages

III. LITIGATION
• Statement of Claim
• Statement of Defence
Which Level of Court
1. Regional court, Higher Court,
Supreme Court
2. Depends on the law of the

geographic jurisdiction where
the law suit is started
3. May depend on the $ value you

are suing for
COURT SYSTEM IN VN
- Supreme People’s Court
- High People’s Court
- Provincial People’s Court
- District People’s Court
- Miliary Court
(Art 3 – Law on organization of
People’s Courts 2014)
Which Level of Court
Vietnam:
Commercial disputes involving foreign
elements are settled by economic
tribunals in the People’s Province
Courts.
IV. ARBITRATION
ADVANTAGES
• Confidentiality
• Party autonomy
• Simplified procedures and faster
decisions
• Not subject to appeal on the merits
• Enforceable in approx 142 countries
CLASSIFICATION
- Ad-hoc Arbitration
- Institutional Arbitration
INSTITUTIONAL ARBITRATION
• ICC International Court of Arbitration

(LCIA)
www.iccwbo.org/court/arbitration
• Singapore International Arbitration
Centre
Website: www.siac.org.sg
• Japan Commercial Arbitration
Association
Website: www.jcaa.or.jp
• China International Economic and
Trade Arbitration
INSTITUTIONAL ARBITRATION
• Hong Kong International Arbitration

Centre (HKIAC)
Website: www.hkiac.org
• American Arbitration Association
Website: www.adr.org
• Thai Arbitration Institute
( Ministry of Justice)
ARBITRATION CENTERS IN VN
1. Vietnam International Arbitration Centre – VIAC
6th Floor, 9 Đào Duy Anh, Đống Đa, HN
2. Pacific International Arbitration Centre – PIAC
57-59 Hồ Tùng Mậu, Bến Nghé, HCM
3. Hochiminh City Commercial Arbitration Center –
TRACENT
460 Cách mạng Tháng tám,Tân Bình, HCM
ARBITRATION CENTERS IN VN
4. Vietnam Finance and Banking Commercial Arbitration
Centre – VIFIBAR– 569-573 Trần Hưng Đạo Dist 1 HCM
5. Finance Commercial Arbitration Centre – FCCA –
215/42 Nguyễn Xí, Bình Thạnh, TPHCM
6. Vietnam Lawyers’ Commercial Arbitration Centre –
VLCAC – 163/18 Xô Viết Nghệ Tĩnh – Bình Thạnh,
TPHCM
Conditions for resolving dispute by
arbitration
• A dispute shall be resolved by arbitration if
the parties have an arbitration agreement.
ARBITRATION AGREEMENT
• Form: In writing or equivalent
+ Art 2 New York Convention 1958
+ Art 16 Law on VN Commercial
Arbitration 2010 (VNCAL)
ART 16 – VNCAL 2010
a) An agreement established via an exchange between the
parties by telegram, facsimile, telex, email or other form
prescribed by law;
b) An agreement established via the exchange of written
information between parties;
c) An agreement prepared in writing by a lawyer, notary or
competent organization at the request of the parties;
d) Reference by the parties during the course of a transaction to
a document such as a contract, source document, company
charter or other similar documents which contain an arbitration
agreement
e) Exchange of a statement of claim and defense which express
the existence of an agreement proposed by one party and not
denied by the other party.
ARBITRATION AGREEMENT
(?) What is the relationship between
arbitration agreement and contract?
An arbitration agreement shall exist totally

independently of the contract.
Any modification, extension or rescission of the
contract, or invalidity or unenforceability of the
contract shall not result in the invalidity of the
arbitration agreement.
(Art 19 – VNCAL)
ARBITRATION AGREEMENTS NULL
AND VOID
VNCAL 2010 (Art 18):
a) The dispute arises in a sector outside the competence for
arbitration prescribed in article 2 of this Law;
b) The person who entered into the arbitration agreement lacked
authority as stipulated by law.
c) The person who entered into the arbitration agreement lacked
legal capacity pursuant to the Civil Code;
d) The form of the arbitration agreement does not comply with
article 16 of this law;
e) One of the parties was deceived, threatened or coerced
during the process of formulation of the arbitration agreement
and requests a declaration that the arbitration agreement is void;
f) The arbitration agreement breaches a prohibited clause
prescribed by law.
Recognition and enforcement of
foreign arbitral awards
Three questions will arise:
1) what are the conditions required for
recognition or enforcement?
2) What procedure should be expected?
3) What defence might be available?
COURT SYSTEM
IN COMMON LAW COUNTRIES
OUTLINE
Court system in the US
Court system in Australia
Court system in the UK

Court system in the US
Overview of court system in the US
Source: Clarkson, M (2021). Business Law – Text and Cases, p.73

The State court systems
• (1) Trial courts of general jurisdiction
• (2) Trial courts of limited jurisdiction
• (3) Appellate courts (intermediate appellate
courts)
• (4) The state’s highest court (often called the
state supreme court)
(1) Trial courts of general jurisdiction
• Trial courts that have general jurisdiction as to
subject matter may be called county, district,
superior, or circuit courts.
• State trial courts of general jurisdiction have
jurisdiction over a wide variety of subjects,
including both civil disputes and criminal
prosecutions.
• In some states, trial courts of general jurisdiction
may hear appeals from courts of limited
jurisdiction.
(2) Trial courts of limited jurisdiction
• Courts of limited jurisdiction as to subject matter are
generally inferior trial courts or minor judiciary courts.
• Limited jurisdiction courts might include local municipal
courts (which could include separate traffic courts and
drug courts) and domestic relations courts (which
handle divorce and child-custody disputes).
• Small claims courts are inferior trial courts that hear
only civil cases involving claims of less than a certain
amount, such as $5,000 (the amount varies from state)
(3) Appellate/Reviewing court
• Every state has at least one court of appeals
(appellate court, or reviewing court), which may
be an intermediate appellate court or the state’s
highest court.
• Courts of appeals do not conduct new trials
• The appellate court hears arguments from
attorneys and determines whether the trial court
committed an error.
• Reviewing courts focus on questions of law, not
questions of fact.
(4) Highest state courts
• The highest appellate court in a state is usually
called the supreme court but may be
designated by some other name.
• The decisions of each state’s highest court on
all questions of state law are final.
• Only when issues of federal law are involved
can the United States Supreme Court overrule
a decision made by a state’s highest court.
The Federal Court system
• (1) U.S. district courts (trial courts of general
jurisdiction) and various courts of limited
jurisdiction
• (2) U.S. courts of appeals (intermediate courts
of appeals)
• (3) The United States Supreme Court.
U.S. District Courts
• District courts are the federal
courts where trials are held and
lawsuits are begun.
• All states have at least one.
• For all federal cases, district
courts have original
jurisdiction, the authority to
hear the case for the first time.
•District courts hear both civil and criminal
cases.
•They are the only federal courts that involve
witnesses and juries.
U.S. Courts of Appeals
• People who lose in a district court often
appeal to the next highest level—a U.S. court
of appeals.
• Appeals courts review decisions made in
lower district courts. This is appellate
jurisdiction—the authority to hear a case
appealed from a lower court.
The US Circuit Court of Appeals
Each of the 12 U.S. courts of appeals covers a
particular geographic area called a circuit. A
thirteenth appeals court, the Court of Appeals for
the Federal Circuit, has nationwide jurisdiction.
Appeals courts do not hold trials. Instead, a panel
of judges reviews the case records and listens to
arguments from lawyers on both sides.
The judges may decide in one of three ways:
uphold (AGREE) the original decision, reverse
(disagree) the decision, or remand the case—
send it back to the lower court to be tried again.
The Supreme Court Justices
• The main job of the nation's top court
is to decide whether laws are
allowable under the Constitution.
• The Supreme Court has original
jurisdiction only in cases involving
foreign diplomats or a state. All other
cases come to the Court on appeal.
• The Court chooses the cases it hears
through the writ of Certiorari.
• The Court chooses the cases it hears.
In cases the Court refuses to hear, the
decision of the lower court stands.
The Current Supreme Court
John G. Roberts, Jr., Chief Justice
Amy Coney Barret, Associate Justice

Neil Gorsuch, Associate Justice
Clarence Thomas, Associate Justice
Brett Kavanaugh, Associate Justice
Stephen G. Breyer, Associate Justice
Samuel Anthony Alito, Jr., Associate Justice
Sonia Sotomayor, Associate Justice.
Elena Kagan, Associate Justice
 The court has final authority

The president appoints Supreme on cases involving the
Court justices, with Senate constitution, acts of
approval. The president's decision Congress, and treaties.
may be influenced by the Justice  Eight associate justices and
Department, American Bar one chief justice make up
Association, interest groups, and the supreme court.
other Supreme Court justices.
Powers of the Court
• The Court's main job is to decide whether laws and
government actions are constitutional, or allowed by
the Constitution. It does this through judicial
review—the power to say whether any law or
government action goes against the Constitution.
• The legislative and executive branches must follow
Supreme Court rulings. Because the Court is
removed from politics and the influences of special-
interest groups, the parties involved in a case are
likely to get a fair hearing.
Case Law
• The published opinions of judges that
arise from court cases where they
interpret statutes, regulations, and
constitutional provisions
• Legal system depends on these decisions
and the precedents they establish
• Stare Decisis (Precedence)
– Controlling and persuasive authority
274
Marbury v. Madison
 The Constitution does not give
the Supreme Court the power of
judicial review. The Court
claimed the power when it
decided the case Marbury v.
Madison.
 As President John Adams was
leaving office, he signed an
order making William Marbury a
justice of the peace. The
incoming president, Thomas
Jefferson, refused to carry out
the order. Marbury took his case
to the Supreme Court.
The Power of Judicial Review
 In the Court's opinion, Chief Justice John Marshall set
forth three principles of judicial review:
 (1) The Constitution is the supreme law of the land.
 (2) If a law conflicts with the Constitution, the
Constitution rules.
 (3) The judicial branch has a duty to uphold the
Constitution. Thus, it must be able to determine
when a law conflicts with the Constitution and nullify
that law.
 Through its rulings, the Supreme Court interprets the
meaning of laws, helping the police and other courts
apply them.
Limits on the Courts' Power
 The Court depends on the executive branch and state and
local officials to enforce its decisions. Usually they do.
 Congress can get around a Court ruling by passing a new
law, changing a law ruled unconstitutional, or amending
the Constitution.
 The president's power to appoint justices and Congress's
power to approve appointments and to impeach and
remove justices serve to check the power of the Court.
 The Court cannot decide that a law is unconstitutional
unless the law has been challenged in a lower court and
the case comes to it on appeal. The Court accepts only
cases that involve a federal question. It usually stays out
of political questions. It never considers guilt or
innocence.
Court system in Australia
Court Hierarchy
FEDERAL COURTS STATE COURTS
High Court Court of Appeal
Federal Court Family Court Supreme Court
District Court
Federal Circuit Court of Australia Magistrates Court
Tribunals
The Australian Judiciary
State Tribunals
• hear matters of relatively low
importance
• lower formality in proceedings
• expert panel members
• Administrative Appeals
Tribunal, Residential Tenancies
Tribunal
State Local or Magistrate Courts
• hear matters of moderate
importance
• moderate formality in
proceedings
• assessors and magistrates
• less serious crimes and civil
cases up to $100,000
State District or County Courts
• hear matters of importance
• formality in proceedings
• judges
• serious crimes (except murder,
treason, and piracy)
• civil matters up to $750,000
• all motor accident cases
State Supreme Courts
• hear matters of high
importance
• high formality in proceedings
• judges
• most serious crimes
• unlimited civil jurisdiction
Federal Circuit Court
• hears matters of importance
• formality in proceedings
• judges
• relieves workload of Federal
Court and Family Court
• matters include bankruptcy,
migration, divorces
Federal Court of Australia
• hears matters of high
importance
• judges
• matters include trade
practices, taxation and civil
matters under Federal law
Family Court of Australia
• hears matters of high
importance
• judges
• matters include family
violence, parental mental
health, child abuse
High Court of Australia
• hears matters of very high
importance
• very high formality in
proceedings
• judges
• unlimited jurisdiction
• appeals against decisions of
state Supreme Courts
Appeals process
• you can appeal the decisions
of lower courts to higher
courts
• High Court is the highest court
of appeal
• appeals move from below
upwards
Precedent
• decisions by judges should be
consistent
• decisions of higher courts are
binding on lower courts
• decisions of lower courts may
be persuasive
• precedent moves from above
downwards
Constitutional Review
• The High Court has the power to review the
validity of new Commonwealth legislation to
ensure it is enacted under a Commonwealth
power in the Constitution
• New legislation must be enacted under an
exclusive or concurrent power
• If the legislation falls under a residual power
retained by the states, such as crime or
education, it will be unconstitutional and
invalid
Precedent
• A precedent can be divided into two parts:
ratio decidendi and obtier dicta
• Ratio decidendi are the judges reasons for
the decision and form the binding part of
the precedent
• Obiter dicta are the ‘sayings by the way’ or
judges additional commentary and are only
persuasive, not binding
Adversarial system
• In court, two opposing parties argue their case
before a judge who acts as a neutral third party
• The side that has brought the case to court for
hearing is called the plaintiff
• The side that is defending themselves against the
plaintiff’s action is called the defendant
• The judges decides whether the plaintiff or the
defendant is right and makes court orders in favour
of the winning party
• The term adversary means opponent which is why
this system of court proceedings is known as the
adversarial system
Court system in the UK
UK courts and tribunals
• Which country does “English” refer to?
England + Wales + Scotland = Great Britain
Great Britain + Northern Ireland →

The United Kingdom
- The UK is a unitary state, but without a single body of law

- There is no single court system for the United Kingdom.
- Separate court systems are in place for England and Wales, for
Scotland, and for Northern Ireland.
The UK Supreme Court
• The Supreme Court is the highest court
in the court hierarchy.
• It is the final court of appeal for all
United Kingdom civil cases, as well as for
criminal cases from England, Wales and
Northern Ireland (but not Scotland).
• The Supreme Court hears appeals on
arguable points of law of general public
importance, and it concentrates on cases
of the greatest public and constitutional
importance.
• The court is staffed by 12 ‘independently
appointed judges’ – Justices of the
Supreme Court.
The Supreme Court of the United Kingdom replaced
the House of Lords in 2009 at the apex of the United Kingdom’s
legal system.
The Court Hierarchy in England and Wales
⚫ The Court of Appeal
⚫ The distinction between the Civil and Criminal Divisions
⚫ Binds all lower courts
⚫ Also binds itself with exceptions
⚫ What are the exceptions?

- Young v Bristol Aeroplane [1944] 2 All ER 293 (CA)
- R (on the application of M) v Secretary of State for Work and Pensions [2008]
UKHL 63, [2009] 1 AC 311
⚫ The High Court
⚫ The Divisions of the High Court (Ch, Fam, QB)
⚫ What is the Divisional Court?
⚫ Queen’s Bench Division

- Appeals by way of ‘case stated’
⚫ Family Division
⚫ Chancery Division
⚫ Below the High Court....
⚫ County Court
⚫ Crown Court
⚫ Magistrates’ Courts
Tribunals
⚫ What are Tribunals?
⚫ The Characteristics of Tribunals

- Specialised
- Employment Appeal Tribunal
- Less formal than the courts
⚫ Advantages of Tribunals
- Speed
- Cost
- Informal
- Flexible
- Specialised
- Help the courts
- Awareness of Policy
- Privacy
⚫ The Composition of Tribunals

Tribunals
⚫ History of Tribunals
⚫ Franks Committee 1957
⚫ Leggatt Review 2000
⚫ Transforming Public Services 2004
⚫ Tribunals, Courts and Enforcement Act 2007
⚫ The New Framework of Tribunals
⚫ Control of Tribunals
Thank You

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INTRODUCTION TO LAW

TRAN THANH TAM (LL.M, PhD Candidate)

Lecturer: TRẦN THANH TÂM

0918. 014. 246

2 Parties doing business in Vietnam

3 Fundamentals of Business Contract

ATTENDANCE 10% ATTENDANCE CHECK

MID – TERM TEST 30% ASSIGNMENT +/ PRESENTATION

FINAL EXAM 60% WRITING TEST

TRẦN THANH TÂM

• Law may be defined as a body of rules, created

Delegated Ordinances - pháp lệnh

Law is a very large field, and it is common to

• Criminal law and civil law luật hình sự vs luật dân sự

• Substantive law and procedural law

• Private Law and Public Law are concerned

• Private Law deals with the relationships

Law regulates relationship

State State Bodies

Law regulates relationship

• Common Law and Civil Law are terms used

• Common Law is used to describe legal

• One of the unique features of the common

• Case law is merely the rules of law

• The doctrine of Stare decisis - a Latin phrase

• PROS AND CONS OF USING PRECEDENTS

• Substantive Law: Defines rights and

• Procedural Law: Establishes processes for

• Art 5.6 Law on Commerce 1997:

1. Parties (individuals, organizations) shall

Commercial activities mean activities for the

→ The parties shall register their business

“Foreign traders mean traders established and making

3.2. FORMS OF FOREIGN TRADERS IN VIETNAM

1. What are similarities and differences

2. List forms of business made by foreign

1. HISTORY OF THE ENTERPRISE LAW IN VN

State-owned Law on State-

( Art 4.21, Law on enterprises 2020)

Vietnamese Foreign Abbreviated

(3) The abbreviated name of an enterprise

1. Using names which are identical or confusingly

a/ The Vietnamese name of an enterprise requesting

2.4. Sole Proprietorship (188 - 193)

(?) LESS THAN 2 & MORE THAN 50???

A, B, C together established D Co.,Ltd.

On the due date, B contributed 200 mil (The

→ Capital Contribution Certificate (Art 47.5)

DIRECTOR CONTROLLING BOARD

REMARK: Company >=11 members: Controlling board is

DIRECTOR CONTROLLING BOARD

REMARK: State-owned LLCs and its subsidiaries: Controlling

A. MEMBERS’ COUNCIL (ART.55)

B. CHAIRPERSON OF MEMBERS’COUNCIL (ART 56)

- Rights and Obligations: Art 65.3

A. CAPITAL CONTRIBUTION: IN FULL WITHIN THE

INSTITUTIONAL OWNER INDIVIDUAL OWNER

DIRECTOR DIRECTOR DIRECTOR

CONTROLLING BOARD CONTROLLING BOARD

REMARK: State-owned LLCs: Controlling board is compulsory. The remainder:

LEGAL ISSUES ON CHARTER CAPITAL

+ CAPITAL STRUCTURE OF SJC:

CHARTER CAPITAL = TOTAL PAR VALUE OF SOLD

AT THE TIME OF ESTABLISHMENT: