Overview
Vietnamese law, consistent with the New York Convention 1958 (“NYC“), adopts a pro-enforcement framework for foreign arbitral awards. Domestic courts are not empowered to re-examine the merits of disputes decided by arbitral tribunals; instead, judicial review is confined to narrowly defined grounds, largely procedural in nature.
This article builds on our earlier discussion of the Supreme People’s Court’s Decision No. 03/2023/KN-KDTM in our June 2024 article titled “Vietnam Supreme Court Upholds Recognition and Enforcement of ICC Arbitral Award in Landmark Decision“, which reaffirmed a pro-enforcement approach to foreign arbitral awards in Vietnam. While that decision underscored judicial restraint at the highest level, recent case law suggests that questions remain as to how lower courts apply NYC-type grounds in practice.
Against that background, this article takes a closer look at how those grounds are applied and why the boundary between legality review and impermissible merits review may be tested in certain cases – particularly where objections are based on public policy (“fundamental principles of Vietnamese law“) and, to a lesser extent, due process. It also notes a recent regulatory development concerning arbitration within Vietnam’s International Financial Centre (“IFC“) that may further reinforce the policy direction towards finality and restrained court intervention.
Finally, we offer practical guidance for parties to an arbitration across contract drafting, during the arbitration, and at the enforcement stage.
Key Takeaways
- Vietnam’s statutory framework broadly aligns with the NYC; enforcement risk arises primarily from application rather than legislation.
- The public policy or “fundamental principles” ground remains the most sensitive and has, in some cases, invited arguments resembling a merits review.
- Appellate courts and the Supreme People’s Court have demonstrated a corrective, pro-enforcement trend.
- Recent IFC-related regulations introduce an express waiver mechanism in relation to set-aside proceedings for awards and certain decisions issued by the IFC International Arbitration Centre, signalling a policy preference for finality and restrained court intervention.
- Enforcement risks can be materially reduced through precise drafting, disciplined procedure, and early enforcement planning.
Legal Framework
Under Vietnam’s Civil Procedure Code, courts seized of applications to recognise and enforce foreign arbitral awards are prohibited from re-adjudicating the dispute and may refuse recognition only on grounds corresponding to Article V of the NYC.
In Vietnamese practice, the NYC public policy exception is commonly articulated through the domestic concept of “fundamental principles of Vietnamese law”, which has become the focal point of many contested enforcement proceedings.
Recent Developments: IFC International Arbitration and Waiver of Right to Set-aside
A notable recent development is Decree No. 328/2025/ND-CP on the International Arbitration Centre under Vietnam’s International Financial Centre (“Decree“).
Where the parties agree to resolve disputes at the IFC International Arbitration Centre, they may agree in writing to waive the right to request the court to set aside (i) a decision recognising the parties’ settlement, or (ii) an arbitral award issued by an arbitral tribunal of that Centre that has taken legal effect. Where a valid written waiver exists, the court will not consider a set-aside request in respect of the relevant award or decision.
The Decree further provides that the waiver forms part of the arbitration agreement for the purposes of Vietnam’s arbitration law. At the same time, the court is not precluded from hearing a set-aside request in two circumstances: (i) where the waiver falls within categories of invalid arbitration agreements under Article 18 of the Law on Commercial Arbitration; and (ii) where the waiver is made after a party has already filed a set-aside request with the court.
From a policy perspective, this mechanism strengthens finality and limits post-award court intervention in an IFC setting. It also sends a clear signal that post-award proceedings should not become a vehicle to reopen the merits of disputes decided by tribunals.
Where the Boundary is Tested in Practice
Public policy framed as “fundamental principles”
The most significant uncertainty tends to arise when public policy arguments move beyond protecting core legal values and instead challenge the substantive correctness of the tribunal’s reasoning. In earlier commentary, we examined how Vietnamese courts have approached public policy objections, often framed as an inconsistency with the “fundamental principles of Vietnamese law”, in the context of enforcing foreign arbitral awards. For more information, please see (i) our June 2025 article titled “Fundamental Principles of Vietnamese Law: Legal Foundations and Application in Arbitration“; and our September 2021 article titled “Enforcement of Arbitral Awards and the Fundamental Principles of Vietnamese Law“.
Building on those observations, this article focuses not on the availability of such grounds, but on how their application may, in certain cases, drift into a substantive reassessment of the tribunal’s reasoning.
Case Study: Sojitz Pla-Net Corporation v Rang Dong Holding JSC (SIAC arbitration) (“Sojitz“)
At first instance, the Ho Chi Minh City court refused recognition on the basis that aspects of the award were inconsistent with the “fundamental principles of Vietnamese law”. In doing so, the court examined whether the tribunal had properly applied Vietnamese substantive law – an approach that effectively ventured into a reassessment of the merits.
That decision was subsequently overturned on appeal. The appellate court emphasised that the first-instance court had exceeded its mandate by engaging with the tribunal’s legal analysis and reaffirmed that Vietnamese courts are not entitled to revisit the merits when reviewing foreign arbitral awards.
If public policy is used as a vehicle to reassess the tribunal’s substantive reasoning, the finality principle underpinning the NYC may be undermined. The appellate reversal in Sojitz therefore represents an important signal of judicial restraint.
Due process objections and procedural formalism
Due process is a legitimate safeguard under the NYC. Difficulties arise, however, where courts approach due process in an overly formalistic manner, treating compliance with institutional rules or procedural timelines as grounds to deny enforcement.
Case Study: Decision No. 03/2023/KN-KDTM (Supreme People’s Court) (“Decision No. 03/2023“)
In this case, a lower court had refused recognition of an International Chamber of Commerce (“ICC“) consent award based on alleged procedural irregularities, including the timing of the award under Vietnam’s Law on Commercial Arbitration and certain aspects of ICC procedure.
The Supreme People’s Court quashed that refusal and upheld recognition and enforcement. Adopting a pragmatic view of ICC arbitration practice, it confirmed that reliance on institutional rules and procedures did not, in the circumstances, amount to a denial of due process.
This decision reinforces a NYC-consistent threshold for due process review and highlights the Supreme Court’s role in correcting overly intrusive approaches at lower levels.
Comparative Note
The challenge of maintaining a clear boundary between legality review and merits review is not unique to Vietnam. In leading arbitration jurisdictions such as Singapore, England, and France, courts have consistently affirmed judicial restraint, emphasising that errors in the determination of facts or in the application of law by an arbitral tribunal, even if serious, do not in themselves constitute grounds for refusing recognition or enforcement of a foreign arbitral award.
Recent Vietnamese appellate and Supreme Court decisions indicate a growing convergence with this international approach, even if first-instance practice remains uneven.
Practical Guidance for Arbitration Users
Contract drafting
Arbitration clauses should define scope with precision to minimise arguments that the tribunal exceeded its mandate.
Where disputes are to be resolved at the IFC International Arbitration Centre, parties should consider – at the contracting stage – whether a waiver of set-aside rights in advance is appropriate in their specific context, and ensure that any waiver is clearly documented and valid under the applicable law.
The applicable institutional rules and procedural framework should be clearly specified, particularly in Vietnam-related transactions.
During the arbitration
Parties should maintain a comprehensive procedural record, including service of notices, opportunities to present evidence, procedural orders, and the tribunal’s reasoning on case management issues.
At the enforcement stage
Parties should anticipate broad “fundamental principles” objections and be prepared to demonstrate that such arguments amount, in substance, to an impermissible request for merits review.
Where appropriate, reliance should be placed on appellate and Supreme Court reasonings, including Sojitz and Decision No. 03/2023, to anchor submissions within established limits of judicial review.
Our Comments
Vietnam’s enforcement landscape can best be described as “framework strong, application variable”. Sojitz illustrates how public policy language can invite merits-style reasoning at first instance, while subsequent appellate and Supreme Court decisions demonstrate an increasing willingness to correct such overreach.
The introduction of an express waiver mechanism for set-aside proceedings in the IFC arbitration framework further reinforces the policy direction towards finality and restrained court intervention. For parties doing business with Vietnamese counterparties, effective risk management lies not in abstract doctrine but in front-loaded drafting, disciplined procedural conduct, and early preparation for enforcement.
This article was authored by Dr Chau Huy Quang, Mr Cao Dang Duy, and Dr Le Hong Phuc (also a lecturer at Phenikaa University). A PDF version is available here.
Dr Chau Huy Quang
Vu Thi Que
Logan Leung
Nguyen Dinh Nha
Huynh Thi Thu Thuy
Cao Dang Duy
