1. Differences in Dispute Resolution Processes
1.1. Resolution Process via Commercial Arbitration
Review of Case Files:
When a dispute resolution request is made, the case files need to be reviewed to determine the statute of limitations for initiating legal action. According to Article 33 of the Commercial Arbitration Law 2010, the statute of limitations for arbitration proceedings is 2 years from the time when the rights and legitimate interests of the parties were violated.
Filing a Lawsuit with the Arbitration Center:
According to Clause 1, Article 30 of the Commercial Arbitration Law, if the dispute is resolved at an arbitration center, the plaintiff must file a lawsuit with the arbitration center. If the dispute is resolved through ad hoc arbitration, the plaintiff must file a lawsuit and send it to the defendant. The arbitration process begins when the arbitration center or the defendant receives the plaintiff’s lawsuit, unless the parties have agreed otherwise.
Establishment of the Arbitration Council:
According to Article 39 of the Commercial Arbitration Law 2010, the arbitration center forms the Arbitration Council. The council may consist of one or more arbitrators as agreed upon by the parties. If the parties do not agree on the number of arbitrators, the Arbitration Council will consist of three arbitrators.
Mediation:
The Arbitration Council conducts mediation to help the parties reach a mutual agreement on resolving the dispute. If mediation is successful, a record is made, and a decision is issued to recognize the successful mediation as stipulated in Article 58 of the Commercial Arbitration Law 2010.
Conducting a Hearing to Resolve the Dispute:
The dispute resolution hearing is conducted privately unless the parties agree otherwise. The parties may attend the hearing in person or authorize a representative, and they have the right to invite witnesses and legal representatives to protect their rights and interests. With the consent of the parties, the Arbitration Council may allow others to attend the hearing.
Arbitration Council’s Decision:
According to Article 60 of the Commercial Arbitration Law 2010, the Arbitration Council issues an arbitral award by majority vote. If a majority decision cannot be reached, the arbitral award is made according to the opinion of the Chairman of the Arbitration Council. The arbitral award is final and binding from the date it is issued.
1.2. Resolution Process via Court
Filing a Lawsuit:
The plaintiff files a lawsuit (using the form prescribed by Resolution No. 01/2017/NĐ-HĐTP) with the competent People’s Court, and the filing must be done within the legal time limits. If the statute of limitations has expired, the court will not accept the lawsuit.
Acceptance of the Case:
According to Clause 3, Article 191 of the Civil Procedure Code 2015 (CPC), the time limit for processing a lawsuit is 5 working days from the date the case is assigned. Clause 1, Article 195 of the CPC states that after receiving the lawsuit and accompanying documents, if the case falls within the court’s jurisdiction, the judge must immediately notify the plaintiff to proceed with paying the court fees. Clause 1, Article 196 of the CPC requires that within 3 working days from the acceptance of the case, the judge must notify the plaintiff, defendant, relevant organizations, individuals, and the same-level procuracy of the case acceptance.
Mediation for Commercial Disputes:
The preparation time for a first-instance trial usually ranges from 2 to 4 months. During this time, the court will conduct mediation to help the parties reach an agreement on resolving the case. If an agreement is reached, the court will issue a record of successful mediation. If mediation fails, the case will proceed to trial.
Trial for Commercial Disputes:
According to Point b, Clause 1, Article 203 of the CPC, for business and commercial cases stipulated in Article 30 of the CPC, which are sensitive and require timely resolution, the preparation time for trial is 2 months from the date of case acceptance. In complex cases or due to objective obstacles, the Chief Justice may decide to extend the preparation time, but not exceeding 1 month. After the trial, the court will issue a judgment on the commercial dispute between the parties. If any party disagrees, they may appeal the decision.
2. Costs and Time
For Commercial Arbitration:
Arbitration fees are set by the arbitration center and include the fees stipulated in Article 34 of the Commercial Arbitration Law. In ad hoc arbitration, the fees are determined by the Arbitration Council. The resolution time is generally faster than in court, depending on the complexity of the case.
For Court Proceedings:
The cost is usually lower than arbitration since the court is a state agency with many supported costs. However, if the case is prolonged, costs can significantly increase. Court proceedings generally take longer, especially for complex cases or cases with multiple levels of adjudication.
3. Confidentiality and Privacy
Court Proceedings:
Dispute resolution through the court is generally public, and judgments are widely published, so it lacks confidentiality. In contrast, arbitration proceedings and decisions are not disclosed, unless the parties agree otherwise, making arbitration a more confidential option.
4. How to resolve disputes using Bigboss International Commercial Arbitration Center
To resolve disputes by commercial arbitration at BBIAC. Customers can write in the contract one of the following two contents:
4.1. Model Arbitration Clause
“Any dispute arising out of or related to this contract shall be resolved by arbitration at the BIGBOSS International Commercial Arbitration Center (BBIAC) in accordance with its Arbitration Rules.”
In addition, the parties may add:
(a) the number of arbitrators is [one or three].
(b) the place of arbitration is [city and/or country].
(c) the law applicable to the contract is [ ].*
(d) the arbitration language is [ ].** Note: *
Only applicable to disputes with foreign elements **
Only applies to disputes with foreign elements or disputes in which at least one party is a foreign-invested enterprise.
4.2. The Model Arbitration Clause applies to summary proceedings
“Any dispute arising out of or in connection with this contract shall be resolved by arbitration at the BIGBOSS International Commercial Arbitration Center (BBIAC) in accordance with its Rules of Arbitration. The parties agree that the arbitration proceedings will be conducted in accordance with the Summary Procedures set out in Article 37 of the BBIAC Arbitration Rules.”
In addition, the parties may add:
(a) the place of arbitration is [city and/or country].
(b) the law applicable to the contract is [ ].*
(c) the arbitration language is [ ]. **
Note:
* Only applies to disputes with foreign elements
** Only applies to disputes with foreign elements or disputes where at least one party is a foreign-invested enterprise
