Principles of settling commercial disputes by conciliation according to Vietnamese law
“Hi Lawyer, currently our joint-stock company is facing a trademark dispute with another enterprise. Based on the actual situation; recognize the nature of the case to be resolved by a third party; We have agreed to choose commercial mediation as the above dispute resolution method. In addition to understanding the provisions of this method of dispute resolution; I want to ask a lawyer, how is the principle of commercial dispute resolution by mediation expressed? I would like to express my sincere thanks to the Lawyer.”. Thank you for sending us your question, today, LSX Lawfirm will give you an article about “Principles of settling commercial disputes by conciliation according to Vietnamese law: as follows:
Legal grounds
Commercial Law 2005
Decree 22/2017/ND-CP
The concept of commercial mediation
- Firstly, Commercial mediation is a method of settling commercial disputes agreed upon by the parties and supported by a commercial mediator to resolve disputes in accordance with the law.
- Secondly, Commercial dispute settlement is an activity of a competent agency or organization to carry out procedures for settling disputes arising in commercial activities.
- Thirdly, Commercial dispute mediation is one of the commercial dispute resolution methods by which one party acts as a mediator to assist in the settlement of disputes between the parties.
Principles of settling commercial disputes by conciliation
Principles of settling commercial disputes by conciliation are specified in Article 4 of Decree No. 22/2017/ND-CP. Specifically
Voluntary Principles
- The principle of voluntariness is a fundamental principle of out-of-court dispute resolution methods. This principle is reflected in two aspects that are: The use of the mediation method must be based on the parties’ choice by a voluntary agreement;
- Participation in dispute resolution by commercial mediators must also be voluntary.
- The voluntary principle in conciliation is even more evident than the arbitration method in that; when using mediation to resolve disputes; the parties will be respected completely, not bound,…
Principle of self-determination
- The principle of self-determination means that when participating in the mediation process; the mediator may not force the parties to follow a certain order, or must comply with a solution chosen by the mediator. The parties are not bound by coercive decisions of the State in the mediation process.
- When the parties choose a non-binding settlement method such as mediation; the third party cannot force the parties to accept any agreement; but only when the parties agree, that will be considered the result. Only then will they be bound by mutual agreements; and these results will constitute contractual obligations that may be of a coercive nature from the Court as a contract or as a judgment.
- The parties’ agreement in mediation activities should ensure legitimacy; the content is not intended to evade obligations or infringe on the rights of third parties (Clause 3, Article 4 of Decree 22/2017/ND-CP).
Privacy Policy
- This is a principle aimed at protecting the interests of the parties in the dispute settlement process. The principle of confidentiality is a fundamental and important principle; recognized in most of the legal documents related to a commercial business in many countries.
- In general, when approaching this principle; all legal documents stipulate the direction of conciliation; and the parties to the dispute are obligated not to disclose the information; documents to third parties. When the principle of confidentiality is respected by the parties; The parties will be more open to sharing information, thereby increasing the efficiency of dispute resolution, etc.
- Confidentiality covers not only the obligations of the disputing parties; but also includes the mediator’s obligation to keep the dispute confidential; as well as other information learned while participating in the mediation process.
Principles of flexible and effective dispute resolution
- A common highlight of out-of-court dispute resolution methods is flexibility. Accordingly, the parties are free to decide which organization or person will conduct dispute resolution; or decide which procedure will applied.
- The degree of flexibility in mediation is higher than in arbitration. Because reconciliation also has the principle of self-determination; All decisions will belong to the disputing parties, the mediator is only a support and advisory party.
- The content of this principle expressed in a number of basic points as follows: Flexible procedures, flexible settlement methods; settlement plan based on the interests of the parties. One of the highlights of dispute resolution by mediation is that the mediator does not only focus on resolving disputes on the basis of law; that the mediator needs to find out the conflicts and solutions to satisfy the interests of the parties, etc
Principle of neutrality, equality, and fairness
- Neutral means that the mediator must stand in an intermediary position, independent of the parties. Equality means the position of the disputing parties and the dispute settlers; the position between the disputing parties is equal, without discrimination or discrimination. Fairness means making sure not to favor either party.
- Clause 1, Article 4 of Decree 22/2017/ND-CP has recorded that the disputing parties participate in conciliation based on the principle of equality; does not directly refer to the principle of equity. The principle of neutrality not mentioned in this clause; which mentioned in the commercial mediator’s obligation to be “independent, impartial, objective and honest” (Point a Clause 2, Article 9 of Decree 22/2017/ND-CP).
- To concretize this principle, according to Vietnam’s current regulations; the mediator may not concurrently act as a representative or consultant for one of the parties; may not concurrently act as an arbitrator for a dispute that is or has conciliated; unless otherwise agreed by the parties (Point dd, Clause 2, Article 9 of Decree 22/2017/ND-CP).
The role of commercial dispute mediation
- Firstly, mediation promotes and ensures the element of self-determination. In mediation, the disputing parties can talk; exchange, negotiate and discuss solutions in the whole process. The parties have the right to freedom of expression; to express and defend their point of view.
- Secondly, dispute resolution by mediation can maintained; or improve the relationship between the parties by taking into account the actual interests and concerns of the parties. Mediation is less dependent on rules and principles; which are mainly based on people.
- Thirdly, out-of-court mediation is a useful method when the parties do not choose a Court; or arbitration by flexible procedure; not rigid, can negotiated and adopted.
- Fourthly, mediation helps to settle disputes and minimize disputes; disagreement, conflict, and friction are in the most optimal way because of their advantages.
- Finally, mediation known as an alternative dispute resolution method in the context that the Court overloaded with disputes that need to resolved; contributes to reducing the workload on the Court, saving costs, etc.
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Related questions
Accordingly to the provisions of Article 17 of Decree 22/2017/ND-CP; The conciliation procedure ends when the parties reach a successful conciliation result; When the commercial mediator considers it unnecessary to continue performing the mediation, after consulting the parties; and at the request of one or more of the disputing parties.
Accordingly to the provisions of Article 18 of Decree 22/2017/ND-CP; A commercial mediation organization includes: A commercial mediation center established and operating under the provisions of this Decree, and arbitration centers established and operating under the law on commercial arbitration shall conduct commercial mediation activities as prescribed in Article 23 of this Decree.
Accordingly to the provisions of Clause 2, Article 3 of Decree No. 22/2017/ND-CP; Mediation agreement is an agreement between the parties on the settlement of disputes that may arise or have arisen by mediation.
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