E-signatures of individuals under the Law on E-Transaction 2023

On 22 June 2023, the National Assembly passed a new Law on E-transactions, set to be effect from 1 July 2024 (LET 2023). The LET 2023 introduces significant changes regarding the use of e-signatures by individuals as outlined below:

1)         Restriction on individuals’ right to create and use of their own e-signature

The LET 2023 categorizes e-signatures into three types as below, none of which encompass e-signatures self-generated by individuals:

  • specialized e-signatures (chữ ký điện tử chuyên dùng), which are created and used by organizations for their “own private operations” in accordance with their function and tasks;

  • public digital signature (chữ ký số công cộng), which are used for “public activities” and are secured by an e-certificate confirming the public digital signature issued by a qualified service provider; and

  • specialized digital signature for official use (chữ ký số chuyên dùng công vụ), which are digital signatures used for official activities and are secured by an e-certificate confirming the specialized digital signature for official use issued by a qualified service provider

Unlike the broader definition of e-signatures under the LET 2005, which may cover signatures self-created by individuals, this classification significantly limits individuals' ability to create and use their own e-signatures. Under the LET 2023, individuals may be required to use a public digital signature issued by a third-party service provider in normal e-transactions.

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Written by Nguyen Quang Vu On In ,

Consequences Of Breaches Of Representations And Warranties Under Vietnamese Law

Introduction

As detailed in a prior post, in our opinion, representations and warranties (warranties) should constitute obligations of the person giving it under Vietnamese law. They could imply an obligation on the part of the person providing them (Warrantor) to guarantee that the stated facts and matters are true. In this post, we will try to examine the consequences of breaches of representations and warranties under Vietnamese law. As discussed further below, depending on the context, a breach of warranties might give rise to:

·        liabilities for breach of warranties as independent obligations; or

·        liabilities for breach of obligations to deliver conforming goods; or

·        liabilities for breach of obligations to provide information to contracting parties; or

·        indemnity (or reimbursement) of losses to the extent the parties have agreed for an indemnity (or reimbursement) of losses arising from a breach of warranties.

Given that “representations and warranties” are exclusively common law concepts and no specific legal framework for them is provided under Vietnamese law, it is important that Vietnamese law contracts should have provisions dealing with the above in order to achieve the intended outcome of the parties.

Based on the discussion below, probably, the preferable approach is to have specific wording in the share sale and purchase agreement that warranties form part of the description and quality of the sale shares so that, among other things, seller could be subject to the remedies applicable to breach of obligation to deliver non-conforming goods.

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Written by Nguyen Quang Vu On In ,

Are representations and warranties considered as obligations under Vietnamese law?

Representations and warranties constitute an important building block in a contract. Unfortunately, Vietnamese contract law does not have a separate regime on representations and warranties. Accordingly, this gives rise to various questions concerning representations and warranties under Vietnamese law. The first question would be whether representations and warranties are considered as obligations of the person giving it.

In a book on Vietnam contract law, the author, a well-known business lawyer, considers that representations and warranties are statements of facts and are not undertaking to perform or not perform a specific task. Therefore, representations and warranties are not obligations under Vietnamese law. We have a different view on this.

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Written by Nguyen Quang Vu On In ,

The Supreme Court’s clarification on various legal issues in Vietnam

n 24 April 2023, the Justices of the Supreme Court of Vietnam (the Supreme Court) hosted an online seminar to tackle some issues that arise in the courts’ trial practice. Official Letter no. 196/TANDTC-PC issued by the Supreme Court on 3 October 2023 (the Official Letter) documents the results from the online seminar in April. The Official Letter contains mainly the clarification and interpretation of the Supreme Court of the existing legal provisions across various areas of law, including penal, civil, commercial, and administrative. Although these clarification and interpretation are non-binding, they constitute an important source of interpretation for the court system to rely on.

In this post, we will discuss some clarifications from the Official Letter that we find interesting or noteworthy:

1)         The subjects capable of committing the crime of “Intentional public disclosure of false information or concealment of information in securities activities” (Article 209 of the Penal Code 2015) are the natural persons or commercial legal persons responsible for public disclosure of information regarding securities, and not the parties to a securities transfer transaction.

Our comments:

The clarification for the Supreme Court is not clear since under the securities regulations, sometimes parties to a securities transaction must make public disclosure about the transaction (e.g., sale or purchase of shares by a major/inside shareholder). So it appears that this crime only applies to a person who violate the disclosure obligations under securities regulations but not to a person who fails to disclosure information under its contractual obligations.

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Written by Nguyen Quang Vu On In ,