Establishing Court Precedents - A New Development

A court judgment in Vietnam is not a legal instrument and does not bind subsequent judgments on the same subject. This makes court judgments in Vietnam less important to lawyers than official letters issued by Government authorities. In October 2012, the Supreme Court has taken the first step to establish a “non-binding” court precedent system in Vietnam. In particular, the Supreme Court has approved a plan:

65% or 51% simple majority voting?

Under the Enterprise Law, the quorum for a meeting of the Shareholders Meeting is met when the number of shareholders present in person and by proxy represents at least 65% of all voting shares. A decision of the Shareholders Meeting on matters which are not a super majority issue can only be passed if it is approved by a number of shareholders holding more than 65% of the number of shares entitled to vote.

Resolution 71 approving Vietnam’s accession to the WTO (Resolution 71) provides that “[A] shareholding company is entitled to provide in its charter … the number of members [of the company] required for holding a shareholder meeting [and] … the majority vote necessary (including 51% majority) in order to pass decisions … of the shareholder meeting”.

Role of international treaties in Vietnamese law

Vietnam is a party to various international treaties. Many of those contain important market entry commitments, National Treatment commitments or Most Favoured Nations Treatments commitments. Accordingly, international treaties sometimes play an important role in determining the rights and obligations of a foreign investor. However, when studying an international treaty, one should note the following:

The role of "Official Letters" in Vietnam legal system

Official letters (công văn) are regarded as administrative documents (văn bản hành chính) as opposed to a legal instrument and are intended to contain correspondences from various authorities. However, in practice, in official letters addressed to other authorities or companies, many authorities express their views and interpretations of a legal provision. In many cases, Government authorities even give instruction on how certain issues should be addressed if there is no law regarding such issue or the law is not clear.

Accordingly, although official letters are not legal instruments and do not have the force of law, in practice, official letters provide useful interpretive aid and guidance for lawyers and practitioners in Vietnam. The downside of relying on official letters is that they are not always publicly available and the view or interpretation contained in an official letter can be changed in the future or conflict with other official letters or legal instruments. An official letter issued by one authority may not bind another authority if the other authority is not under control of the issuing authority.

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Vietnam Business Law