You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

January 27, 2022

Enforcement of Foreign Arbitral Awards: Thailand and Vietnam

Practising Law Institute

Thailand and Vietnam are major destinations for foreign direct investment (FDI) in Asia, resulting in significant levels of cross-border transactions. According to the World Bank, in 2018 and 2019 Thailand attracted a combined net inflow of about USD 18 billion in FDI.  During the same period, net inflows to Vietnam were USD 31.62 billion. These high volumes of inbound investment inevitably lead to a higher risk of disputes with everyone from suppliers, contractors, joint venture partners, borrowers, and of course state-owned companies and government agencies.

International arbitration is a viable means of handling such disputes. Both Thailand and Vietnam are contracting states to the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”), so arbitral awards from other member states are enforceable. With this in mind, an international arbitration award has to be enforced. This usually means filing cases in the local Thai and Vietnamese courts. As explained in this report, both Thailand and Vietnam have legislative frameworks in place to enforce arbitral awards, but in practice, enforcement can be a challenging and time-consuming endeavor. Before electing to pursue arbitration against private and state entities, foreign investors should be aware of how awards are actually enforced in these emerging Asian jurisdictions.

To read the full article, please download the report through the button below.

 

This article was first published in September 2021 by the Practising Law Institute as part of their course materials for International Investment Law & Investor-State Dispute Settlement 2021.

RELATED INSIGHTS​ 

February 28, 2023
For most in-house counsel, the thought of defending a civil case brought against the company is typically an unpleasant proposition—even more so when the matter is proceeding in a foreign or unfamiliar jurisdiction in which the substantive law and court procedures differ from those in one’s home jurisdiction. But different procedures, even if unfamiliar, can sometimes be advantageous to a defendant. This is particularly true with respect to certain aspects of the discovery process in Thai civil court proceedings. For in-house counsel in certain jurisdictions, the specter of litigation not only entails the potential risks posed to the company and the time and financial costs inevitably incurred, it can also mean lengthy and costly discovery battles. However, as discussed in more detail below, due to the nature of Thai discovery procedures, these types of discovery battles are typically rare in Thai civil court proceedings. Further, due to the limited scope and mechanisms for discovery practice in Thailand, the whole discovery process tends to be rather expedient and straightforward, particularly when compared to that in jurisdictions with extensive discovery practice. In this article, the authors provide an overview of some of the more notable features of the process for discovery under the Thai Civil Procedure Code (“CPC”), particularly those that may differ from those in jurisdictions with a more vigorous and wide-reaching discovery process. (We note that this article addresses only discovery procedures in civil proceedings in Thai courts; the discovery process in criminal proceedings is subject to the Thai Criminal Procedure Code and differs from the process in civil courts in some respects.) Rules of Evidence Before taking a closer look at some of the discovery provisions in the CPC, it is important to understand a few fundamental principles of Thai evidence law, as these provide the general guidelines
February 24, 2023
On February 20, 2023, the Supreme People’s Court of Vietnam submitted a Practical Report on the Implementation of the Law on Organization of People’s Courts, as well as a Draft Amendment of the Law on Organization of People’s Courts to seek online comment from interested parties. Notably, the Supreme People’s Court has expressed a desire to establish specialized courts such as an IP court and a bankruptcy court. Practical Report on the Implementation of the Law on Organization of People’s Courts The Supreme People’s Court reviewed the implementation over the past eight years of the Law on Organization of People’s Courts (“LOPC”), which took effect in 2015. Some highlights of the implementation process, as set out in the Supreme People’s Court’s practical report, are as follows: Re-systematization of all levels of courts: The LOPC systematized the court system in Vietnam, including four levels: Supreme People’s Court Three Superior People’s Courts 765 first-instance trial courts (including 702 district courts and 63 provincial courts) 66 appellate courts (including 63 provincial people’s courts and the three Superior People’s Courts) In addition, the Supreme People’s Court established four adjudicating agencies for cassation and reopening (including three Judicial Committees of the Superior People’s Court and the Council of Judges of the Supreme People’s Court). Support departments for the court have been strengthened, and policies have been developed to train judges. Trial results: From June 1, 2015, to April 30, 2022, the courts have settled 3,187,285 cases of all kinds out of a total of 3,334,915 cases handled (95.57%). Most of the remaining cases are newly accepted and still within the time limit for settlement as prescribed by law. On average, the courts have had to deal with about 476,416 cases each year. Draft Amendment of Law on Organization of People’s Courts Despite the notable
December 19, 2022
On November 22, 2022, the Thai cabinet approved in principle the draft Liability for Defective Goods Act (the “Bill”) proposed by the Office of the Consumer Protection Board. While Thailand’s Product Liability Act B.E. 2551 (2008) deals with liability to consumers arising from unsafe products, the draft Liability for Defective Goods Act aims to ensure that consumers are well protected from defects in appliances and vehicles that might not initially be easily visible or noticed. Key Definitions The Bill applies most notably to business operators and consumers. In the Bill, a “business operator” who may potentially be liable is: a manufacturer (or its hirer) of goods for sale; or a consignee or importer who brings goods into Thailand for sale; or a seller or a hire purchase provider who cannot identify the manufacturer (or its hirer) or the importer. As opposed to the Product Liability Act, which clearly provides that all business operators in the supply chain must be jointly liable, the Bill lacks such clear guidance. This could be interpreted as meaning that under the current Bill only the business operator at the top of the supply chain who is sued in the same case as other business operators is responsible. A “consumer” is defined as a purchaser or hirer of goods from a manufacturer, including an assignee or successor of the goods from the purchaser or hirer. Scope and Application The Bill is intended to govern purchase or hire-purchase contracts for: electric appliances; electronic devices; personal cars and motorcycles; other goods that may be set out in a future royal decree issued under the act. The Bill will not apply to any purchase or hire purchase of used products or as-is products when this is clearly stated by the seller or hire-purchase provider or the auctioneer in
November 24, 2022
On November 24, 2022, Secretary-General of the Permanent Court of Arbitration (PCA) Marcin Czepelak and leaders of Vietnam’s Ministry of Foreign Affairs chaired the opening ceremony of the PCA’s Representative Office in Hanoi. Beyond its headquarters in The Hague, the PCA has opened offices in other cities to make its services more accessible in different regions. The Hanoi office will be the PCA’s fourth office outside its headquarters. The PCA, established in 1899, is an intergovernmental organization which provides resolution services for disputes involving states, state entities, international organizations, as well as private entities. It provides and administers arbitration, mediation, conciliation, and fact-finding commissions of inquiry. The PCA’s services are primarily used in Europe and Asia. In cases administered in 2021, approximately 47% of the disputing parties were from the Western European and Others Group of the United Nations Regional Groups, and 40% from the Asia Pacific Group. The majority of disputes resolved by PCA are state-related disputes; however, the PCA’s scope of settlement is also extended to the private sector. The PCA’s Hanoi office is staffed to administer PCA hearings and meetings and will provide administrative services in support of parties and arbitrators conducting arbitral proceedings under the PCA’s auspices, serving as the official channel of communications and ensuring safe custody of documents. The PCA can also provide such services as financial administration, logistical and technical support for meetings and hearings, travel arrangements, and general secretarial and linguistic support. Currently, Vietnam has some active members of the PCA. The opening of the PCA representative office is a step toward realizing commitments between Vietnam and the PCA in their protocol signed in 2021, and serving the evolving dispute resolution needs of states and other entities in the coming years. With the new office in Hanoi, it is expected that