Today LSX Lawfirm will give you an article about ” Regulations on the term of economic contracts in Vietnam“, as follows:
Legal grounds
Enterprise Law 2020
What is an economic contract?
An economic contract is a written agreement; transaction documents between the contracting parties on the performance of production work; exchange of goods and services, research, application of scientific and technical advances, and other agreements for business purposes; with clearly defined rights and obligations of each party to develop and implement its plan.
Currently, when drafting the Contract; should not be generally defined as an economic contract, but should be based on the purpose; the basis for determining the correct and correct name of the contract.
Regulations on the term of economic contracts in Vietnam
The contract term is a defined period of time for the parties to exercise their rights and contractual obligations. This period is counted from the time the contract comes into effect until the time when the grounds for termination of the contract appear.
Lawfully entered into a contract takes effect from the time of signing; unless otherwise agreed or otherwise provided by relevant law.
From the effective date of the contract; The parties must perform their rights and obligations towards each other as committed. The contract can only be modified or canceled by agreement of the parties or according to the provisions of law.
Economic contracts are signed for business purposes
Economic contracts are always associate with production activities; reproduce and exchange goods and services of business entities; in which at least one contracting party must have a business purpose.
The main purpose of a civil contract is to meet the consumption needs of the parties.
Characteristics of the subject of an economic contract
In the economic contractual relationship; at least one party must be a juridical person; The other party can be a legal entity or an individual with business registration. The content of the signed contract must be consistent with the registered business scope.
As for civil contracts, all organizations and individuals can become the subject of the contract.
Form of economic contract
Economic contracts must be signed in writing or transaction documents; documents signed by the parties to confirm the content of the agreement; maybe in the form of a letter; email; offers, orders, telegrams…
An economic contract is effective when it meets specialized legal regulations.
Firstly, the procedure and form of the contract must comply with certain forms in accordance with the provisions of law; for each type of contract. For example, the contract of sale and purchase of land use rights must be notarized; endorsement or BCC business cooperation contract with foreign investors; must apply for an Investment Registration Certificate.
Secondly, the contract must have enough content according to the guidance of specialized law.
Anyone who signs a contract wants to take advantage, and quickly put in and sign the terms in your favor. Hence the prevention of deception; or checking the validity of the contract when signing with many difficulties. However; The contract is only void if it declares invalid in part or in whole by the court. Content that is declared invalid will be excluded from the obligation of the parties to comply with the terms agreed in the contract. The parties will return to each other the values at the time of signing.
- The statute of limitations for requesting the Court to declare the contract invalid is 2 years.
- Classify contracts as void.
In addition
- The contract is completely void: The contract is completely invalid when the entire purpose and content of the contract violates the prohibition of the law; unethical by society or one of the contracting parties does not have the right to enter into a civil transaction or violates an agreement and affects the validity of the remaining parts; resulting in the entire transaction being void.
- Partial voidable contract: A contract is completely void when a part of the contract is void but does not affect the validity of the remainder of the contract.
Legal consequences when the Court declares the contract invalid
- A voidable contract has no legal value; does not give rise to the rights and obligations of the parties.
- The invalidity of the main contract terminates the sub-contract; unless the parties have agreed that the sub-contract may replace the main contract. However; the law has provisions excluding the application of this provision with measures to secure the performance of obligations; validity relationship between security contracts; With the main contract, there will be separate provisions of the law on security measures.
- The invalidity of the sub-contract does not terminate the main contract; unless the parties agree that the sub-contract is an integral part of the main contract.
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