In order to recognise and enforce a foreign judgment or decision in the Vietnamese territory, the foreign judgment or decision must be of a kind that is recognised and permitted to be enforced by a Vietnamese court. This procedure is intended to resolve jurisdictional conflicts and ensure respect for each country’s jurisdiction. The overall aims are to guarantee the legal rights of the judgment debtor and avoid having the same case tried twice.
Under Vietnamese law, the recognition of foreign judgments are governed by Chapters XXXV and XXXVI of the 2015 Code of Civil Procedure (CCP); while the enforcement of foreign judgments is governed by the 2008 Law on Civil Enforcement, as amended by the 2014 Law on Civil Enforcement.
Accordingly, where the involved parties wish to recognise and enforce a foreign judgment or decision in the Vietnamese territory (if the judgment debtor resides in Vietnam or has its head office in Vietnam, or if property that is the subject of the foreign judgment is available in Vietnam at the time of the request), the involved parties or their lawful representatives must submit an application to the Vietnamese courts or the Ministry of Justice for recognition or permission to enforce.
Multilateral instruments: The Hague Convention on Court Selection Agreement was established on 30 June 2005 within the framework of the Hague Conference on International Justice. One of its main purposes was to enhance trade and investment support through cooperation between the judicial authorities of member countries. This cooperation would be effected through the common rule of jurisdiction and allow for the recognition and enforcement of judgments and decisions of foreign courts in civil and commercial fields. Vietnam was officially recognised as the 73rd member of the Hague Conference on 10 April 2013.
In addition, all 10 Association of Southeast Asian Nations members are parties to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Vietnam also became a signatory to this convention from July 1995.
Bilateral instruments: To date, Vietnam has signed 18 bilateral international treaties with other countries on mutual legal assistance in civil legal matters. In particular, agreements have been signed with:
- nine European countries (Russia, Ukraine, Poland, Belarus, Bulgaria, Hungary, the Czech Republic, Slovakia and France);
- six Asian countries and one territory (Laos, Cambodia, China, Kazakhstan, Mongolia, North Korea and Taiwan Territory);
- one African country (Algeria); and
- one American country (Cuba).
These bilateral agreements all refer to the recognition of court judgments and arbitral awards. Among them, nine treaties refer to the 1958 New York Convention and four have their own provisions.
Under the CCP, a Vietnamese court has jurisdiction to recognise and enforce, or refuse to recognise and enforce, judgments or decisions:
- relating to civil, marriage and family, commercial or labour matters;
- on property in criminal or administrative judgments; and
- of foreign courts.
Specifically, Article 37.1 of the CCP provides that the provincial courts have jurisdiction to resolve these matters.
Under Article 39.2.(d) of the CCP, the territorial jurisdiction of the provincial courts is determined by the place where:
- a person who is required to comply with a foreign judgment or decision on civil, marriage and family, commercial or labour matters resides or works (in the case of individual judgment debtors);
- the judgment debtor is headquartered (in the case of agency or organisational judgment debtors); or
- the property relating to the enforcement of such foreign judgment or decision is located.
The provincial courts have jurisdiction to hear applications for the recognition and enforcement of foreign judgments and decisions in Vietnam.
Under Article 423 of the Code of Civil Procedure (CCP), foreign judgments and decisions relating to civil, marriage, family, business, commercial or labour matters, and decisions on property in criminal/administrative proceedings, will be recognised and enforced under Vietnamese law. In addition, Article 424 of the CCP provides that a foreign arbitral award will be recognised and enforced under Vietnamese law. The grounds for recognition and enforcement of foreign judgments are based on two principles:
- international treaties to which Vietnam is a signatory (see question 1.2); and
- the principle of reciprocity.
In addition, Article 118 of the 2014 Law on Bankruptcy, which regulates the procedures for recognition and enforcement of foreign bankruptcy decisions, provides: “The recognition and authorisation to implement decisions on bankruptcy settlement must comply with the regulations on the judicial assistance treaty to which the Socialist Republic of Vietnam is a State Party and other regulations of the law on judicial assistance.” With this provision, the Law on Bankruptcy affirms that the recognition and enforcement of a foreign court’s decision to settle bankruptcy matters is a type of mutual legal assistance that Vietnam performs for a foreign country in accordance with the Agreement on Mutual Legal Assistance and the Law on Mutual Legal Assistance.
Nevertheless, 16 out of 17 bilateral international treaties that Vietnam has signed with other countries on mutual legal assistance in civil matters exclude the consideration, recognition and enforcement of bankruptcy judgments from mutual legal assistance activities. The agreement between Vietnam and Hungary signed in 2018 and effective 6 March 2019 provides that a foreign court’s bankruptcy decision will not be considered for recognition and enforcement (Article 21.1 of the agreement), due to differences between the bankruptcy proceedings and civil proceedings of the two countries.
Accordingly, despite the Law on Bankruptcy, there are currently no bilateral agreements on mutual legal assistance to which Vietnam is a member which provide for the recognition and enforcement of bankruptcy foreign judgments and decisions of one country in particular.
Article 432.1 of the CCP regulates the prescriptive periods for filing applications for recognition and enforcement and provides that: “Within three years of the day on which the civil judgment/decision of a foreign court takes legal effect, the judgment/decision creditors, persons with relevant legitimate rights and interests or their lawful representatives may submit their application …”
According to this provision, a foreign judgment must be final and binding before it can be recognised and enforced in Vietnam. Accordingly, the applicant for recognition and enforcement of a foreign judgment must prove that the foreign judgment is final and binding. Further, documents and evidence attached to applications for recognition and enforcement must also be submitted. These documents include those issued by the foreign court or other competent foreign agency certifying that such judgment/decision has taken legal effect and has not expired and may be enforced in Vietnam, except where these details have already been clearly stated in the judgment/decision.
As mentioned in question 2.2, the foreign judgment must be final and have taken legal effect before recognition and enforcement can be sought in Vietnam. As such, if the foreign judgment is subject to appeal, it will not be recognised or enforced in Vietnam.
Under Article 432 of the CCP, the limitation period for submitting an application for recognition and enforcement is three years from the date on which the civil judgment/decision of a foreign court takes legal effect. However, this time limit may be extended if the applicant encounters a force majeure event or an objective obstruction and is unable to file a claim within the specified timeframe. In these cases, the applicant must prove that it has been prevented from filing an application due to an objective obstruction or force majeure event.
Recognition: Recognition of a foreign judgment will be granted by the competent court. The application for recognition of a foreign judgments is governed by the Code of Civil Procedure (CCP).
Enforcement: Enforcement is the compulsory execution of a decision after being approved for recognition by the competent court. Accordingly, the Civil Enforcement Agency of Vietnam has the authority to enforce a recognised foreign judgment. As mentioned in question 1.1, the Law on Civil Enforcement governs the procedure for enforcement.
As mentioned in question 1.1, the formal process for recognition and enforcement of a foreign judgment is governed in particular by Chapters XXXV and XXXVI of the CCP. Accordingly, the judgment creditor must submit an application together with attached documents relating to recognition and enforcement to the competent court or the Ministry of Justice. The application must be submitted within the timeframe specified by law.
The application will then be considered at a meeting by a panel consisting of three judges, one of whom will act as the presiding judge assigned by the chief justice of the court. The panel is entitled to make a decision on recognition/non-recognition and enforcement of the foreign civil judgment/decision. This decision of the court may be appealed by the involved parties or by the procuracy authorities.
Articles 433 and 434 of the CCP provide that the following documents must be submitted with the application for recognition and enforcement:
- the application for recognition and enforcement, which must include:
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- the name and address of the applicant;
- the name and address of the judgment debtor; and
- a statement requesting recognition and enforcement of the foreign judgment;
- originals or true certified copies of the foreign judgment;
- documents issued by the foreign court or other competent foreign agencies certifying that such judgment/decision has taken legal effect, has not expired and should be enforced in Vietnam, except where these details have already been clearly stated in the judgment/decision;
- documents issued by the foreign court or other competent foreign agencies certifying the lawful delivery of such judgment/decision to the judgment debtor; and
- where the foreign court has issued a judgment in the absence of the judgment debtor or its lawful representatives, documents issued by the foreign court or other competent foreign agencies certifying that it was duly summoned.
In addition, any documents enclosed with the application which are in a foreign language must be translated into Vietnamese and be duly notarised and authenticated or legalised.
In contrast to the method of charging fees based on the monetary value of the case, a fixed fee is payable for the recognition and enforcement of a foreign judgment, as specified under Resolution 326/2016 UBTVQH, which regulates rates of collection, exemption, reduction, payment, management and use of court fees and charges.
Accordingly, for all cases requesting the recognition and enforcement of a foreign judgment, the applicant must pay a fixed fee of VND 3 million. If there are additional expenses such as entrustment or document translation costs, the applicant must also pay these additional expenses to the court. For instance, entrustment fees are VND 300,000.
No, the applicant is not required to provide security for costs.
Normally, it takes between six months and one year from the date on which the applicant submits an application for recognition of the foreign judgment. This timeframe will depend on:
- whether the documents and evidence attached to the petition are clear and complete; and
- the workload of the court.
In addition, if the involved parties or the procuracy authorities submit an appeal, the time to process the appeal will last for one year or more.
Under Article 438 of the CCP, it is possible to seek injunctive relief while the process is ongoing. The provisions relating to injunctive relief are set out in Chapter VIII of the CCP. Accordingly, according to Resolution No.02/2020/NQ-HDTP dated September 24, 2022 on Guidelines For Certain Regulations On Provisional Emergency Measures Of The Civil Procedure Code, an applicant can submit a request for injunctive relief in the following cases:
- to temporarily provide relief for matters directly related to the case which is being settled by the court that are required to be resolved immediately and that, if delayed, would adversely affect the life, health, honour, dignity and property of the involved party;
- to collect and protect evidence for a case which is being handled or settled by the court where:
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- one of the involved parties obstructs the collection of evidence; or
- the evidence is being destroyed or likely to be destroyed, or will be difficult to obtain thereafter;
- to preserve the status quo and avoid causing irreparable damage by preserving the relationship and subject matter directly related to the case being settled by the court; or
- to secure the resolution of the case or enforcement of the judgment (ie, to ensure that the grounds for resolving the case are sufficient so that when the judgment or decision is enforced, it fully meets the conditions for enforcement).
According to Article 439 of the Code of Civil Procedure (CCP), a foreign judgment or decision may be challenged and will not be recognised or enforced in Vietnam if any of the following criteria are met:
- The foreign judgment or decision does not correspond with one of the conditions for recognition provided in the international treaties of which Vietnam is a member;
- The foreign judgment/decision has not taken legal effect as provided for in the law of the foreign court’s home country;
- The judgment debtor or its legal representative failed to appear at the hearing held by the foreign court because it was not properly summoned, or the summons was not served in a timely and lawful manner to enable it to exercise its right to defend itself;
- The foreign court issuing the judgment or decision lacked the authority to settle the relevant civil matter, according to Article 440 of the CCP;
- A civil case on the matter has already been resolved through a legally effective civil judgment/decision of a Vietnamese court; or, before the relevant foreign court accepted the case, a case on the same matter was accepted and is now being processed by a Vietnamese court; or a civil case on the matter has been resolved through a civil judgment/decision issued by a foreign court which has already been recognised and enforced by a Vietnamese court;
- The time limit for the enforcement of judgment prescribed by the law of the foreign court’s home country or by the Vietnamese law on the enforcement of civil judgments has expired;
- Enforcement of the judgment/decision has been cancelled or terminated in the home country of the foreign court; or
- Recognition and enforcement of the foreign civil judgment/decision would be contrary to the basic principles of law of Vietnam.
The limitation period for filing a challenge to the recognition and enforcement of a foreign judgment or decision is the same as that for applying for recognition and enforcement, as outlined in question 2.4. Accordingly, as provided under Article 444 of Code of Civil Procedure (CCP), within three years of the date on which the foreign civil judgment/decision takes legal effect, the judgment debtor or its lawful representative may request the Vietnam court not to recognise such foreign civil judgment/decision.
In principle, Vietnamese law has no regulations on this issue.
Article 439 of the Code of Civil Procedure (CCP) sets out eight cases in which a foreign judgment or decision will not be recognised or enforced in Vietnam, as outlined in question 4.1. Accordingly, a civil judgment or decision of a foreign court will not be recognised and enforced in Vietnam if:
- the judgment debtor or its lawful representative was absent from the foreign court hearing as it was not duly summoned; or
- the documents of the foreign court were not served on the judgment debtor within such reasonable time as is prescribed by the law of the foreign court’s home country, preventing it from exercising its right to present a defence.
As mentioned in question 4.1, the court will review the jurisdiction of the foreign court for compatibility with international civil law. The Vietnamese court will not examine whether the foreign court had jurisdiction under its local law, but rather whether the case falls under the exclusive jurisdiction of the Vietnamese court. Therefore, the foreign civil judgment or decision may not be recognised and enforced in Vietnam if the case falls under the exclusive jurisdiction of the Vietnamese court.
Under Article 438.4 of the Code of Civil Procedure (CCP), the Vietnamese court will not retry the case; it is only entitled to check and compare the foreign civil judgment/decision and accompanying papers and documents against the provisions of Chapters XXXV and XXXVI of the CCP, other relevant provisions of Vietnamese law and international treaties to which Vietnam is a signatory, in order to establish a basis for a decision to recognise and enforce the foreign judgment/decision. However, recognition and enforcement of the foreign civil judgment or decision in Vietnam must not be contrary to the fundamental principles of Vietnamese law.
See question 5.3.
The Vietnamese court will not recognise a foreign judgment or decision if:
- a Vietnamese court has already issued a legally effective civil judgment or decision in the civil case or matter;
- a Vietnamese court accepted the case before it was accepted by a foreign adjudication body and is now resolving it; or
- a foreign court has issued a civil judgment or decision on the matter which has already been recognised and enforced by a Vietnamese court.
Therefore, a previous judgment in relation to the same dispute between the same parties will not be recognised and enforced in Vietnam if a decision on the matter has already been recognised and enforced by a Vietnamese court.
See question 4.1.
In principle, the Code of Civil Procedure (CCP) only provides that judgment creditors or their lawful representatives may apply to the Vietnamese court for recognition and enforcement of a foreign judgment or decision in Vietnam. It does not clearly specify whether partial recognition and enforcement is possible. To be more specific, the foreign judgment or decision must:
- be final, complete and effective; and
- resolve the dispute in its entirety.
Although the CCP does not provide for partial recognition of foreign court judgments or decisions, Articles 433.1(c) and 445.1(c) address a foreign judgment or decision where part of it includes an obligation to execute the judgment in Vietnam. Accordingly, the applicant has the right to request a Vietnamese court to recognise (or not recognise) that part relating to the obligation to execute the judgment in Vietnam. At the same time, the applicant must prove that the remaining part of the foreign judgment or decision has been enforced.
In general, interest is awarded for a final foreign judgment at a certain rate from the date specified therein. In addition to the payment of interest as mentioned in the final foreign judgment, if the judgment debtor is late in fulfilling the judgment enforcement obligations, it must also bear late payment interest (Article 13.1.(a) of Resolution 01/2019/NQ-HĐTP of the Council of Justices of the Supreme People’s Court).
Regarding court fees and costs, as mentioned in question 3.4, the applicant must pay a fixed fee of VND 3 million to file an application for recognition and enforcement. The applicant must also pay any additional expenses to the court, such as entrustment and document translation costs. Further, if the award is determined in a foreign currency, the judgment debtor may pay it in Vietnamese dong in accordance with the exchange rate provided by the State Bank of Vietnam.
Under Article 442 of the Code of Civil Procedure (CCP), decisions on the recognition and enforcement of foreign judgments can be appealed before the Court of Appeal. Accordingly, within 15 days of the date on which the court issues its decision either to recognise and enforce or not to recognise the foreign judgment/decision, or the date on which the parties receive such decision, the parties and their lawful representatives have the right to file an appeal challenging such decision.
In addition, the chairperson of the provincial people’s procuracy at the place where the court handled the case, or the chairperson of the superior people’s procuracy, has the right to challenge a decisions of the court in relation to the recognition and enforcement of foreign judgments. The time limit for the procuracy to file an appeal challenging the decision is seven days from the date of receipt of such decision for the provincial people’s procuracy and ten days for the superior people’s procuracy.
The decision of the Court of Appeal may be appealed to the Supreme Court according to cassation or reopening procedures under Articles 443.4 and 337.2 of the CCP.
Under Article 291 of the Code of Civil Procedure (CCP), during the preparation of appellate trials, the appellate court can issue decisions to apply, change or cancel provisional emergency measures.
Accordingly, Article 138 of the CCP provides the grounds for the court to cancel provisional emergency measures in any of the following cases:
- The applicant for provisional emergency measures withdraws its request;
- The persons that are subject to the decisions on the application of provisional emergency measures deposit property as security or other persons take measures to secure the performance of the obligations toward the petitioners;
- The civil obligation of the obligor is terminated;
- The case is suspended;
- The decision on the application of provisional emergency measures is not in accordance with the CCP;
- The grounds for the application of provisional emergency measures no longer exist;
- The case has already been resolved through an effective judgment/decision of the courts; or
- The courts have returned the lawsuit petition as prescribed in the CCP.
Once the foreign judgment has been recognised in Vietnam, the judgment creditor can submit a request for enforcement of the judgment to the Civil Enforcement Agency of Vietnam (CEAV).
Accordingly, Article 44 of the Law on Civil Enforcement (LCE) provides that within 10 days of the date on which the CEAV issues the decision on enforcement, the judgment creditor and judgment debtor should voluntarily execute the foreign judgment. Upon the expiration of this timeframe, if the judgment debtor has failed to execute the judgment voluntarily, it will be compelled to do so according to set procedures.
Chapter IV of the LCE provides for the following measures to secure and compel judgment enforcement. Accordingly, Article 66 of the LCE provides for the following measures to secure judgment enforcement:
- freezing bank accounts;
- seizing assets and papers; and
- suspending registration, transfer or change in the current state of assets.
Article 71 of the LCE provides for the following measures to compel the enforcement of a judgment:
- deduction of money from accounts;
- recovery and handling of money and valuable papers of the judgment debtor;
- garnishment of the judgment debtor’s income;
- distraint and handling of the judgment debtor’s assets, including those held by third parties;
- exploitation of the judgment debtor’s assets;
- forcible transfer of objects, property rights and papers; and
- forcible performance or non-performance of certain jobs by the judgment debtor.
In principle, a foreign judgment may be enforced against third parties. As provided under Article 71.3 of the LCE and mentioned in question 7.1, the CEAV can utilise certain measures to compel enforcement of the judgment, including distraint and handling of the judgment debtor’s assets, which also includes those held by third parties.
This provision may be interpreted as stating that if a third party is holding the assets of the judgment debtor, the CEAV has the right to apply measures to distrain such assets. For instance, in a sale of goods contract, where the judgment debtor is the buyer and has paid a third party for the goods, the ownership of the goods has been transferred from the third party to the judgment debtor. However, if the third party has not yet made the delivery, the CEAV has the right to distrain this property.
Another case is where the property of the judgment debtor is being held by a third party. Accordingly, the CEAV has the right to request the third party to provide this property to fulfil the judgment enforcement obligation.
Not all foreign court judgments and arbitral awards will be accepted and considered by the Vietnamese courts. Whether a particular judgment or arbitral award will be considered depends on existing international treaties or diplomatic relations between Vietnam and the home country of the foreign court or tribunal. In principle, the Vietnamese courts will recognise and enforce only foreign court judgments or arbitral awards that:
- accord with the provisions of international treaties signed and participated in by Vietnam;
- are based on a reciprocal agreement; and
- comply with the laws of Vietnam.
The Ministry of Justice recently published a database on the recognition and enforcement of foreign court judgments and arbitral awards in Vietnam from 2012 to 30 September 2019. These statistics reveal that only approximately 49% of foreign court judgments and arbitral awards were recognised and enforced in Vietnam during this period. This figure sheds light on the alarmingly low rate of recognition and enforcement of foreign court judgments and arbitral awards in Vietnam.
There are two possible reasons for this low rate of recognition. First, the foreign court or arbitration centre may be of inadequate quality or may have violated the procedural regulations on dispute resolution. A second reason is that some provisions that frame the recognition and enforcement of foreign judgments or arbitral awards under the Code of Civil Procedure (CCP) and the Law on Commercial Arbitration may not be properly adhered to or may contain vague language without guidelines.
Grounds to deny recognition and enforcement of a foreign judgment or arbitral award in Vietnam are set out in:
- Articles 3, 4, and 5 of the New York Convention 1958; and
- Articles 439 and 459 of the CCP.
The database specifies that five out of 26 foreign judgments and 30 out of 82 foreign arbitral awards have not been recognised in Vietnam. The recognition of a foreign judgment or arbitral award may be denied for multiple reasons.
The recognition and enforcement of a foreign judgment or arbitral award helps to reduce the costs borne by the parties to the dispute. However, recognition and enforcement must comply with certain rules and principles, which serve to demonstrate a nation’s right to jurisdictional independence. This principle precludes the imposition of another nation or international organisation’s legal judgments and awards. Hence, it not only underscores Vietnam’s sovereignty, but also aligns the country with the current values espoused by the global legal community.
According to the database discussed in question 8.1, there are three common cases in which the Vietnamese courts will not recognise and enforce foreign judgments:
- The civil judgment or decision of the foreign court does not meet one of the conditions for recognition set out in the international treaties to which Vietnam is a signatory. (This is the least common reason for refusal of recognition, comprising 20% of all non-recognitions in the database.)
- The judgment debtor or its legal representative failed to appear at the hearing held by the foreign court because it was not properly summoned, or the summons was not served in a timely and lawful manner to enable it to exercise its right of defence. (This accounts for a significant number of refusals of recognition (40%).)
- The court issuing the judgment or decision lacked the authority to settle the relevant civil matter according to Article 440 of the Code of Civil Procedure. (Again, this accounts for 40% of all non-recognitions in the database.)
Therefore, when concluding and performing an international commercial contract, it is very important to select a dispute resolution jurisdiction, as this will affect the recognition and enforcement of foreign judgments in Vietnam. As such, the parties should pay close attention to this choice. In addition, in cases where a foreign court has already issued a judgment, the judgment creditor should carefully prepare the relevant documents that must be attached to the application, so that processing will be streamlined and take less time.