Foreign governing law for commercial contracts signed with Vietnamese counterparties

Under the Commercial Law, the parties to a commercial transaction with a “foreign element” may agree to apply foreign law if such foreign law is not contrary “to the fundamental principles of the law of Vietnam”. The Civil Code defines a civil relation involving “foreign elements” to be a civil relation in which a least one of the participating parties is a foreign body, organisation or individual, or a Vietnamese residing overseas, or the civil relation is between participating parties being Vietnamese citizens or organizations but the basis for the establishment, alteration or termination of such relation was the law of a foreign country, or such basis arose in a foreign country, or the assets involved in the relation are located in a foreign country.
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Written by Nguyen Quang Vu On In

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:

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Written by Nguyen Quang Vu On In

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”.

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Written by Nguyen Quang Vu On In ,

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:
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Written by Nguyen Quang Vu On In ,