In international arbitration, determining the “seat of arbitration” is important since the law of the country where the seat of arbitration is located will usually govern the arbitration proceedings. In addition, international arbitration rules distinguish the seat of arbitration from the venue of arbitration which is the physical place where hearings take place. In Vietnam, the Law on Commercial Arbitration 2010 does not have a clear definition of “seat of arbitration” and “venue of arbitration”.

Article 3.8 of the Law on Commercial Arbitration 2010 provides that:

“Dispute resolution place means the place where the arbitration tribunal conducts the dispute resolution as agreed by the parties, or as decided by the arbitration tribunal if the parties do not have such an agreement. If the dispute resolution place is within the territory of Vietnam then the award is deemed to be made in Vietnam regardless of the location where the arbitral tribunal conducts the hearing to issue the award”

It is not clear if under Vietnamese law, the parties can agree in an arbitration agreement that the award of the tribunal must be a unanimous award instead of a majority award.

In practice, in a three-arbitrator tribunal of which two are appointed by the parties, the vote of the chairman of the tribunal becomes crucial. This is because the party-appointed arbitrator will likely try to find arguments in favor of the relevant appointing party and the vote of the chairman will likely decide the case. Unlike a court judgement, an arbitration award is confidential (i.e., the public cannot know how an arbitrator decides or reaches his/her conclusion on a case), and is final and binding (i.e., there is no review of the awards by another arbitrator). Accordingly, there is limited public review and peer review of an arbitration award. This gives rise to the risk that the tribunal (or the chairman) decides the case wrongly. One possible way to mitigate this risk is to require the award of the tribunal to be a unanimous award (or to be subject to a higher-than-majority voting). If this is not possible then another way is to remove the rights of the parties to select the arbitrators so that there will be no influence by the parties on the party-appointed arbitrators.

The table below sets out the key difference between an arbitration proceeding at the Vietnam Interntional Arbitration Center (VIAC) and the Singapore International Arbitration Center (SIAC). This post is written by Ha Kieu Anh and Le Do Hong Van. A pdf version of this post can be downloaded here.

The below diagram summarises the key steps in an arbitration proceeding at Vietnam International Arbitration Center (VIAC) and Singapore International Arbitration Center (SIAC). A pdf version can be downloaded here. This post is written by Ha Kieu Anh.