Vietnam Legal Research

Anh Luu received her Bachelor of Law in 2001 from Hanoi Law University, Vietnam. She worked for several international law firms in Vietnam before she joined NYU School of Law as a Hauser Scholar in 2005. Anh Luu obtained an LL.M. in Corporation Law from NYU School of Law in 2006. She has been a member of the Hanoi Bar Association since 2004 and qualified in New York in 2007. Anh Luu is working as a Corporate Lawyer at Macfarlanes Solicitors in London.

Introduction

The Socialist Republic of Vietnam has a population of more than 82 million on an area of 331,114 square kilometres in Southeast Asia.[1]

The Vietnamese originated from several tribes and factions since 2000 BC in the northern mountainous area of modern Viet Nam. The country was under Chinese occupation for more than ten centuries until 938 AD. Since then, Vietnam remained independent until the late 19th century. In 1859, Vietnam fell under French colonization and then occupied by Japan during World War II.[2]

The country declared its independence on September 2, 1945 under the name Democratic Republic of Vietnam. The country carried out the war against the French until 1954 when French forces were defeated in the famous Dien Bien Phu battle. The Geneva Accord 1954 temporarily divided the country into two parts along the 17th parallel: the Democratic Republic of Vietnam in the north and the Republic of Viet Nam in the south. After twenty one more years of war between the north (supported by the communist countries) and the south, with deep military involvement of the U.S. Government including its widespread bombing of the north, in 1975 the north took over. The country was fully reunited and later renamed the Socialist Republic of Vietnam.[3]

The country carried out economic reform, popularly known as doi moi, since the 1980s, under which the country diverted from the central planning economy to the market economy.

The centre of doi moi was the provision of rural land to the farmer families, liberalization of internal and external trade, recognition of individual property, and permission of foreign investment.[4] Doi moi dramatically changed Vietnam’s economy and significantly improved the living standard of its people. Poverty rate dropped from 58% in 1993 to 37% in 1998 and 29% in 2002. From a rice importer, Vietnam has become the world’s third largest rice exporter.[5]

Even though Vietnam has been widely praised as a success story of reform, there are concerns about modest foreign direct investment inflows compared to other countries like China, poor rating on corruption and inefficient investment allocation.[6]

The shift from a central planned economy where the State made every decision on the allocation of resources to market economy makes the law indispensable. As a consequence, Vietnamese legislation development coincided with the development of the country’s market economy and most of the legal documents applicable today were issued in the early 90s and many even later. Its legal system is still evolving rapidly and therefore fascinating to observe. However, this also raises a concern over its stability and predictability.

The Communist Party of Vietnam

Even though the Communist Party of Vietnam is a political organization and not part of the State’s institutional system, it is essential to be discussed because of its critical role and deep involvement in the political and legal life of Vietnam.

Vietnam is a one-party-state under the control of the Communist Party of Vietnam. Since the Constitution 1980, the Communist Party of Vietnam has been stated to be “the force leading the State and the society.” Just as the wording, the Communist Party of Vietnam has a central role in shaping the country’s policy and legal system and maintains a firm control over all the government and social system.[7] Its structure is parallel to the government’s structure and has close relation to the government.[8] Its influence is reflected through the formation and election of the National Assembly, the operation of the administration, and the function of the judicial system. Article 41 of the Charter of the Communist Party of Vietnam states that “the Party leads the State by its political statements, its strategy, by ideological activities and through staff management.” It introduces people for election or appointment to State official positions and the majority of high-ranking State officials are Party members. The Party also maintains its influence at all levels of the society through its affiliated organizations: Vietnam Fatherland Front, Ho Chi Minh Communist Youth Union, Ho Chi Minh Young Volunteer Organization, Vietnam Woman Association, Vietnam Farmer Association just to name a few.

The highest authority of the Communist Party of Vietnam is its National Congress which meets once every 5 years. The most important overall policy of the Party, and thus the significant changes in the economic and social policy of the country, is set out in its Resolutions. The standing and more influential bodies of the Party are however its Central Committee and the Politburo.

The economic reform, doi moi¸ originates from the Resolution of the VIth National Congress in 1986 which recognized for the first time the “multi-sectoral economy.” This gave way to the new Constitution 1992 which stated that Vietnam would develop a “multi-component commodity economy functioning in accordance with market mechanisms under the management of the State and following a socialist orientation”. The recognition of multi-sectoral economy, more specifically of private ownership, was a significant change from the previous regime under the Constitution of 1980 which recognized only ownership by the entire people and by collectives.

National Assembly

The Vietnamese government is not structured based on the theory of the separation of powers. The National Assembly is constitutionally the body of highest power of Vietnam. It exercises the legislative power, determines the economic and social policies, domestic and international policies and financial and monetary policies of the country, approves the national budget, and supervises the activities of the Government, the People’s Court and the People’s Prosecutor.[9]

The National Assembly elects its Chairman, the President, Vice President, Prime Minister, the Chief Justice of the People’s Supreme Court and Head of the People’s Supreme Prosecutor. It approves the cabinet at the suggestion by the Prime Minister.

Although having very large constitutional powers, the National Assembly of Vietnam is not necessarily so powerful in practice, nor is its capacity up to the requirements to assume such a centralized power. The majority of the deputies of the National Assembly are part-time deputies who gather to discuss the business of the National Assembly only during two 30-day sessions a year.

Between these sessions, the Standing Committee of the National Assembly supervises the activities of the Government, the People’s Court and the People’s Prosecutor to ensure their conformity to the Constitution and the laws.

Administration

The central government

The Government of Vietnam includes the Ministries and the Ministry-equivalent bodies which are established by the decision of the National Assembly at the suggestion of the Prime Minister.

A comprehensive list of Ministries and Ministry-equivalent authorities could be found on the UNDP’s website.

Partly due to currently limited capacity of the National Assembly, the Ministries have important influence on Vietnamese legislation. See the section on Alternative Dispute Resolution.

Local government

Vietnam is organized into 61 provinces which are subdivided into districts. Below districts are communes.

Each of these three geographic levels has their own local governments consisting of a representative body elected by the local people every five years named the People’s Council and the administrative body named the People’s Committee, whose members are elected by the People’s Council.[10]

Judicial System

Court system

Vietnam has a two tier court system, including courts of first instances and courts of appeal. The judgments are then susceptible to further reviews under special circumstances. The court system consists of the Supreme Court, the provincial People’s Courts and the district People’s Courts. There are specialised courts at the Supreme Court and at the provincial level. These include the Criminal Court, Civil Court, Economic Court, Administrative Court and Labour Court.

The Chief Justice of the Supreme Court is elected by the National Assembly, has the term corresponding to the term of the National Assembly and can be re-elected. Other Justices of the Supreme Court are appointed and removable by the President and have the term of 5 years. The Chief Justice of the Supreme Court appoints and removes judges of the inferior courts.[11]

Under the law, Vietnamese courts render their judgments independently. However, there are still many concerns on the independence of the courts.

The tribunal panels at the first instance are composed of both judges and people’s jurors (usually one judge and two people’s jurors). People’s jurors at each level are lay people elected by the People’s Council of the same level at the recommendation of the Vietnam Fatherland Front and could be re-elected.[12] The participation of these jurors who are not qualified legal expert and who are elected by the local government raises questions on their capacity and on the influence of the local government on the court’s activities.

The law in 2002[13] centralized the appointment of the judges by the Chief Justice of the Supreme Court instead of appointment by the local People’s Council. The budgeting of the local courts, previously decided by the provincial Departments of Justice, is now decided by the National Assembly. This hopefully will make the local courts more independent from the local government.

Another factor leading to the concerns on the independence of the courts is the unwritten practice of the local court requesting for opinion from the superior court in complex cases.[14]

Judgments in Vietnam are not publicly published and it is difficult to get access to past judgments.

People’s Prosecutor

The People’s Prosecutor has the mandate of public prosecution and judicial supervision. Similarly to the structure of the court, the People’s Prosecutor is organized into three levels: the Supreme People’s Prosecutor, provincial People’s Prosecutor and district People’s Prosecutor.

In criminal cases, the People’s Prosecutor carries out the public prosecution role. In non-criminal cases, the People’s Prosecutor supervises the resolution of the cases and has the prerogative to participate in any part of judicial proceedings except the conciliation process. [15] Usually, it reviews the file, listen to evidence and argument and make a recommendation to the tribunal panel.[16]

In addition, the People’s Prosecutor supervises the enforcement of the judgments.

Alternative Dispute Resolution

Mediation

Culturally, Vietnam is not a litigious society. A large number of disputes are resolved outside of court. Vietnamese laws also highly emphasize the role of mediation. Mediation is a mandatory part of certain litigation procedures such as civil litigations, labour and marriage and family litigations. The State encourages the resolution of civil and family disputes and violations of the law which do not amount to criminal offences by means of mediation. At the local community, groups of non-professional mediators are set up to carry out this mediation mandate.[17]

Arbitration

Arbitration is a possible alternative for dispute resolution in Vietnam but restricted for commercial disputes only. Arbitration was not a popular dispute resolution means in Vietnam due to weak enforceability. Since the adoption of the new Ordinance on Commercial Arbitration in 2003, arbitration award given by a Vietnamese arbitration tribunal is automatically enforceable, i.e. the parties do not have to bring the award to courts for a decision for its execution. With the recent reform, it is hoped that Vietnamese arbitration centres are referred to more often and grow more rapidly. The most well-known Vietnamese arbitration organization is the Vietnam International Arbitration Centre at the Vietnam Chamber of Commerce and Industries.

Vietnam has been a member of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Foreign investors tend to refer to foreign arbitration whenever they can due to lack of confidence in the capability and transparency of Vietnamese courts. Until recently, the execution of foreign arbitral awards was troublesome due to the narrow definition of “commercial activities” under Vietnamese law. The New York Convention only guarantees national recognition of foreign arbitral awards on issues considered of commercial nature under the national law. The recent expansion of the “commercial activities” concept was a big step in Vietnamese legal reform.

Legal System

The hierarchy of Vietnamese legal texts is as follows:[18]

Authority	Text
National Assembly	Constitution, Law, Resolution
Standing Committee of the National Assembly	Ordinance, Resolution
President	Order, Decision
Government	Resolution, Decree
Prime Minister	Decision, Directive
Ministers and head of ministry-level bodies	Decision, Directive, Circular, Joint Circular (issued collectively by different ministries or by a ministry and a political and social organisation)
Justice Council of the Supreme People’s Court	Resolution
Chief Justice of the Supreme People’s Court/ Head of the Supreme People’s Prosecutor	Decision, Directive
People’s Council	Resolution
People’s Committee	Decision, Directive

Legal texts are published on the Official Gazette.

Vietnam’s legal system is evolving fast and the legislation work has been significantly improved. In line with the increasing number of legal texts, the Official Gazette has increased its rate of publication from two issues per month in 1995 to daily in 2004. The number of laws and other legal texts increases rapidly. From early 2003,[19] legal texts must be published in the Official Gazette as a compulsory condition for becoming effective. This compulsory publication is a great improvement compared to the previous situation where most of legal texts became effective 15 days after the date of signature and not all legal texts were published. The dynamism and transparency of the legal system, as a result, were improved significantly.

Despite these significant improvements, Vietnamese legislation work is still weak resulting in the legal system being inadequate and unstable. One of the reasons explaining this shortcoming is the function of the National Assembly. The National Assembly does not consist of professional and specialized legislators. Its members are working people gathering only during two 30-day sessions per year. Its mandate of approving the country’s economic and social development plans, financial and monetary policies, the national budget, as well as questioning the Government’s activities takes up a large amount of time, leaving a modest agenda to legal debate and approval of laws. On the other hand, its legislation workload increased tremendously under the country’s commitment under the 2000 U.S.-Vietnam Bilateral Trade Agreement and under the pressure to adhere to the World Trade Organization. Most of laws are passed after one or two session of debates by the National Assembly.[20] Vietnam’s first Competition Law, as a typical example, was given four days of debate before being passed into Law in November 2004. The input of the National Assembly on the country’s laws is therefore still limited.

In practice, the real legislators are the administrators, particularly the Ministries. A set of rules on a specific issue in Vietnam typically includes: (i) a law drafted by a relevant Ministry, consented first by the Government, then approved by the National Assembly; (ii) an implementing Decree drafted by that Ministry and issued by the Government; and (iii) an implementing Circular issued by the same Ministry. Adding to this, a significant number of parliamentarians are administration officials. This has important impacts on the National Assembly’s decision. Laws are usually drafted in such general terms that they are not enforceable without the implementing decrees and circulars.

This legislation process magnifies the power of the executives, conferring them the unwritten power to interpret law. Constitutionally, this is in the power of the Standing Committee of the National Assembly. In the absence of a specialised and effective supervisor of the constitutionality and legality of legal documents, interpretation of the executive bodies sometimes results in a de facto amendment to the law.

As listed above, jurisprudence is not recognized as a source of law and is not part of the legal system. However, as a matter of practice, every year, the Supreme Court produces a collection of typical cases with comments and instructions. These treatises are relied on seriously by the inferior courts.

There is no formal process of codification in Vietnamese law. In certain important area where the law issued by the National Assembly is relatively comprehensive and complete, the name “Code” is used. To date, there are the following major codes of Vietnamese laws: the Civil Code, the Civil Procedure Code, the Criminal Code, the Criminal Procedure Code, the Labour Code,

Informal compilation of legal texts in specific areas are carried out and published by different publishing houses. The most reliable source is the National Political Publishing House which publishes a wide range of legal texts and compilations of legal texts. The National Political Publishing House operates under the Communist Party of Vietnam. It has been assigned by the Politburo the mandate of publishing political and legal publications.[21]

Research Resources

The research resource on the Vietnamese legal system is still limited. Following are some useful resources.

• The Institute on State and Law has a library at 27 Tran Xuan Soan, Hanoi, Vietnam, Tel.: (844) 9713 334
• The National Library has a collection of diverse materials including legal materials. Notably, it has certain resources on the old legal texts and legal system before the establishment of the current government of Vietnam. It is located at 31 Trang Thi, Hanoi, Vietnam, Tel.: (844) 8255 419
• The Central Institute for Economic Management under the Ministry of Planning and Investment carries out certain researches on business law issues. Their library contains the Official Gazette, Vietnam Law Database and other materials relating to Vietnam’s economic reform.
• Part of the World Bank’s global network of public information centers, the Vietnam Development Information Centre has a collection of materials on Vietnam and Vietnamese economy by the development actors.
• All of the legal texts are now published on the Official Gazette. The Vietnamese versions up to the year 2003 could now be accessed online. This publication has an English version in hard copy. Some business legal texts in English could be accessed for free here.

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[1] UNDP’s website http://www.undp.org.vn/undp/fact/base.htm, visited on March 22, 2006.

[2] UN’s Briefing Report for Vietnam on June 2004 at http://www.undp.org.vn/undp/docs/2004/briefing04/briefing04.pdf, visited on March 22, 2006.

[3] UN’s Briefing Report for Vietnam on June 2004 at http://www.undp.org.vn/undp/docs/2004/briefing04/briefing04.pdf, visited on March 22, 2006.

[4] Jordan D. Ryan and Jens C. Wandel, Vietnam’s Reform Experience – the Quest for Stability during Transition, May 1999 at http://www.undp.org.vn/undp/docs/1996/reform/eng/index.htm, visited March 22, 2006.

[5] UN’s Briefing Report for Vietnam on June 2004 at http://www.undp.org.vn/undp/docs/2004/briefing04/briefing04.pdf, visited on March 22, 2006.

[6] David O. Dapice, Vietnam’s Economy: Success Story or Weird Dualism? A SWOT Analysis, June 2003.

[7] Brian J.M. Quinn, Legal reform and its context in Vietnam, Columbia Journal of Asian Law, Spring 2002.

[8] Article 10 of the Charter of the Communist Party of Vietnam.

[9] Law on the organization of the National Assembly dated 25 December 2001.

[10] Law on the organization of the People’s Council and People’s Committee dated 26 November 2003.

[11] Law on the organization of the people’s courts approved by the National Assembly on 2 April 2002.

[12] Ordinance of the Standing Committee of the National Assembly dated 4 October 2002 on People’s Judges and People’s Jurors.

[13] Law on the organization of the people’s courts approved by the National Assembly on 2 April 2002.

[14] Brian J.M. Quinn, Legal reform and its context in Vietnam, Columbia Journal of Asian Law, Spring 2002.

[15] Brian J.M. Quinn, Legal reform and its context in Vietnam, Columbia Journal of Asian Law, Spring 2002.

[16] Brian J.M. Quinn, Legal reform and its context in Vietnam, Columbia Journal of Asian Law, Spring 2002.

[17] Under the Ordinance of organization and performance of mediation at the local communities dated 25 December 1998.

[18] Article 1 of the Law on the issuance of legal texts dated 12 November 1996, as amended on 16 December 2002.

[19] When the Amended Law on the Issuance of the Legal Texts were effective.

[20] Article 45 of the Law on the issuance of legal texts dated 12 November 1996, as amended on 16 December 2002.

[21] Regulation on the function, mandate and organization of the Political Publishing House, at http://www.nxbctqg.org.vn/News/Newsdt.asp?page=1&NewsID=26, visited on 10 May 2006.