Legal framework for commercial conciliation in viet nam from theory to practice

Le Huong Giang 2019, Completing the law on commercial conciliation in Vietnam in the context of international economic integration, PhD Thesis, Hanoi Trang 16 Nguyen Hung Quang 2019, C

HO CHI MINH CITY OPEN UNIVERSITY

- ∞0∞ -

LE THI HANH PHUOC

LEGAL FRAMEWORK FOR COMMERCIAL CONCILIATION IN VIETNAM - FROM

THEORY TO PRACTICE

MASTER’S THESIS IN BUSINESS LAW

HO CHI MINH CITY, 2023

MINISTRY OF EDUCATION AND TRAINING

HO CHI MINH CITY OPEN UNIVERSITY

- ∞0∞ -

LE THI HANH PHUOC

LEGAL FRAMEWORK FOR COMMERCIAL CONCILIATION IN VIETNAM - FROM

THEORY TO PRACTICE

Major: BUSINESS LAW Major code: 8 38 01 07 MASTER’S THESIS IN BUSINESS LAW

Supervisor: Associate Professor -DR DU NGOC BICH

HO CHI MINH CITY, 2023

Tôi tên là: LÊ THỊ HẠNH PHƯỚC

Ngày sinh: 20/03/1985 Nơi sinh: Bình Định

Chuyên ngành: Luật kinh tế Mã học viên: 1883801070037

Tôi đồng ý cung cấp toàn văn thông tin luận văn tốt nghiệp hợp lệ về bản quyền cho Thư viện trường đại học Mở Thành phố Hồ Chí Minh Thư viện trường đại học Mở Thành phố Hồ Chí Minh sẽ kết nối toàn văn thông tin luận văn tốt nghiệp vào hệ thống thông tin khoa học của Sở Khoa học và Công nghệ Thành phố Hồ Chí Minh

Ý KIÉN CHO PHÉP BẢO VỆ LUẬN VĂN THẠC sĩ

CỦA GIẢNG VIÊN HƯỚNG DẪN

Giảng viên hướng dẫn: Phó Giáo sư - Tiến sĩ Dư Ngọc Bích

Họcviên thực hiện: Lê Thị Hạnh Phước Lớp: MLAW018A

Tênđề tài: “Legal framework for commercial conciliation in Vietnam - From theory to

practice”.

Ý kiến của giáo viênhướng dẫn về việc cho phép học viên: LêThị Hạnh Phước được bảo vệ

luận văn trước Hội đồng:

Thành phố Hồ Chí Minh, ngày C tháng 03 năm 2023

Người nhận xét

Dư Ngọc Bích

There are not any products/ studies of other authors to be used in this thesis without quoting according to the regulations

This thesis has never been submitted to get any degree at any university or other training institutions

Ho Chi Minh City, 2023

Author

Le Thi Hanh Phuoc

ACKNOWLEDGEMENT

The completion of thesis “Legal framework for commercial conciliation in

Vietnam - From theory to practice” has marked the author’s process of

perseverance and continuous efforts

First of all, I would like to express my endless thanks and gratefulness/ sincere thanks to the School Administrator, Faculty of Law, Graduate School and all the lecturers and staffs of Ho Chi Minh City Open University has created all favorable conditions during the process of studying, researching and completing my thesis

In particular, I would like to express my deepest gratitude to Associate Professor - Dr Du Ngoc Bich that wholeheartedly helped, guided and created all the best conditions for me in the process of researching this thesis Associate Professor – Dr Du Ngoc Bich has given many valuable comments to help me complete this thesis in the best way This will be extremely valuable knowledge for my future career and life

I would also like to express my sincere gratitude to my family, friends and colleagues who have always supported, helped and encouraged me during the study and completion of this thesis

Finally, I would like to thank the lecturers in the Thesis Evaluation Committee for giving me the valuable comments to improve this thesis

The author wishes all lectures good health, happiness and success in the noble teaching career The author also wishes the Ho Chi Minh City Open University more and more development to train and teach more students in the future

ABSTRACT

The thesis “Legal framework for commercial conciliation in Vietnam - From

theory to practice” is a research topic on commercial conciliation The thesis

focuses on researching theoretical issues and legal provisions on commercial conciliation in Decree No 22/2017-ND-CP such as: Conditions for dispute resolution to commercial conciliation; Commercial conciliation procedures; Regulations and recognition of successful conciliation results; Regulations on commercial conciliators and commercial conciliation organizations

Besides, the thesis also mentions the Singapore Mediation Act with the main highlights including regulations on the implementation of the successful mediation agreement; confidentiality of information about the mediation process; regulations

on the continuity of the mediation proceedings and foreign mediator From there, there is an analysis and comparison of the provisions of Decree No 22/2017-ND-

CP with the UNCITRAL Model Law and the Singapore Mediation Act to compare the similarities and differences with international and regional countries on commercial conciliation

Based on the above comparison results, the thesis lists some practical issues

of the laws on commercial conciliation in Vietnam and proposes solutions to improve the laws on commercial conciliation such as studying, developing and promulgating the Law on Commercial Conciliation; promulgating a code of ethics and professional conduct of Vietnamese commercial conciliators; recognizing the successful conciliation results; supplementing regulations on prioritizing the use of commercial conciliation method if the parties already have a conciliation agreement; issuing more detailed regulations on confidentiality in commercial conciliation On that basis, in order to develop commercial conciliation method to

be more effective in the coming time and to become the preferred dispute resolution method of enterprises when disputes arise

TABLE OF CONTENTS

DECLARATION i

ACKNOWLEDGEMENT ii

ABSTRACT iii

TABLE OF CONTENTS iv

LIST OF ACRONYMS vii

INTRODUCTION 1

1 Rationales for the study 1

2 Literature review 2

3 Objectives of the Study 7

4 Questions of the Study 8

5 Subject and Scope of the study 8

6 Methods of the Study 9

7 Scientific and practical significance of the thesis 9

8 The expected structure of the thesis 10

CHAPTER 1 THEORETICAL GROUNDS OF COMMERCIAL CONCILIATION 11

1.1 Definition and legal characteristics of commercial conciliation 11

1.1.1 Definition of dispute and commercial dispute 11

1.1.2 Definition of commercial conciliation 13

1.1.3 Legal characteristics of commercial conciliation 17

1.2 Classification of commercial conciliation 18

1.2.1 Base on the methods of commercial conciliation 18

1.2.2 Base on the forms of commercial conciliation 20

1.3 The advantages of commercial conciliation 22

1.4 The process of forming the commercial conciliation laws in Vietnam 24

CONCLUSION OF CHAPTER 1 28

CHAPTER 2 LEGAL FRAMEWORK FOR COMMERCIAL CONCILIATION IN VIETNAM 29

2.1 Provisions of the laws on commercial conciliator 29

2.1.1 Provisions on condition for practicing commercial conciliator 29

2.1.2 Provisions for rights and obligations of commercial conciliator 33

2.1.3 The prohibited acts for commercial conciliator 34

2.2 Provisions of the laws on commercial conciliation organizations 35

2.2.1 Provisions for the form of commercial conciliation organizations 35

2.2.2 Provisions for the rights and obligations to commercial conciliation organization 37

2.3 Order and procedures for commercial conciliation 39

2.3.1 Conciliation agreement 39

2.3.2 Conciliation order and procedures 40

2.3.3 Termination of conciliation proceedings 42

2.3.4 Recognition of successful conciliation results 43

CONCLUSION OF CHAPTER 2 45

CHAPTER 3 COMPARISON AMONG UNCITRAL MODEL LAW, SINGAPORE LAW AND VIETNAMESE LAW ON COMMERCIAL CONCILIATION – PROPOSALS FOR THE LAW OF VIETNAM 46

3.1 Comparison between Decree No 22/2017/ND-CP and UNCITRAL Model Law on International Commercial Conciliation 46

3.1.1 Overview of UNCITRAL Model Law on International Commercial Conciliation 46

3.1.2 Similarity and difference between Decree No 22/2017/ND-CP and UNCITRAL Model Law on International Commercial Conciliation 47

3.2 Comparison between the Singaporean law and Vietnamese law on commercial conciliation 50

3.2.1 The scope of application of the Mediation Act 51

3.2.2 Stay of legal proceedings pending mediation 51

3.2.3 The confidentiality of mediation communications 51

3.2.4 Recording of mediated settlement agreement as order of court 52

3.2.5 Foreign counsels and mediators 53

3.2.6 Evaluation of Singapore's commercial mediation model and its applicability in improving Vietnamese laws 53

3.3 Proposals for the law of Vietnam 56

3.3.1 Practical issues of the laws on commercial conciliation in Vietnam 56

3.3.2 Proposals for improving the laws on commercial conciliation in Vietnam 60

3.3.2.1 The necessary for developing and improving the laws on commercial conciliation in Vietnam 60

3.3.2.2 Some specific solutions to improving the laws on commercial conciliation in Vietnam 63

CONCLUSION OF CHAPTER 3 72

CONCLUSION 73

REFERENCES 75

Politburo's Resolution No 49-NQ/TW dated June

2nd, 2005 on strategy of Justice reform to 2020:

"Encouraged the resolution of a number of disputes through the negotiation, conciliation and arbitration The court will support by the decisions to recognize the settlement”

SMC Singapore Mediation Act

UNCITRAL United Nations Commission on International

Trade Law UNCITRAL Model

Law

UNCITRAL Model Law on International Commercial Conciliation (2002, amending and supplementing in 2018)

VMC Vietnam Mediation Center

VIAC Vietnam International Arbitration Center

WTO World Trade Organization

INTRODUCTION

1 Rationales for the study

Currently, Vietnam's international economic integration process has been promoted and taken to a new level by joining the economic and trade organizations

of the region and around the world Exchanges and cooperation among countries are also developing strongly Therefore, Vietnam is making efforts to create a dynamic, modern economy and especially enhance the legal system to ensure compatibility with this integration and development One of the policies that the State encourages and promotes now is the use of alternative dispute resolution methods which avoid suing in order to reduce the load on the court system as well as diversify methods of resolving commercial disputes which were clearly specified on the Politburo's Resolution No 49-NQ/TW dated June 2nd, 2005 on strategy of Justice reform to

2020: "Encouraged the resolution of a number of disputes through the negotiation,

conciliation and arbitration The court will support by the decisions to recognize the settlement” 1

Regarding the method of commercial conciliation, the Commercial Law in

1997 and the Commercial Law in 2005 both stipulated the priority to using conciliation to resolve commercial disputes However, the practice of commercial dispute settlement showing that these regulations are only formalities, thus frustrating the expectations of foreign investors So, the promulgation of legal documents regulating the legal contents of commercial conciliation is very necessary

The Decree No 22/2017/ND-CP dated February 24th, 2017 on commercial conciliation is a step of compliance with commitment from international agreements

to expand the conciliation services that has been signed with the WTO on allowing

1 Nghị quyết số 49-NQ/TW của Bộ Chính trị ngày 2/6/2005 về Chiến lược cải cách tư pháp đến

năm 2020: “Khuyến khích việc giải quyết một số tranh chấp thông qua thương lượng, hòa giải, trọng tài; Tòa án hỗ trợ bằng quyết định công nhận việc giải quyết đó”

the commercial presence of conciliation services as well as arbitration for commercial disputes between businesses2 The development of a legal framework for commercial conciliation activities also contributes to make Vietnam's legal system consistent with international laws This Decree No 22/2017/ND-CP also shows the Government’s policies of encouraging parties to use commercial conciliation to resolve commercial disputes, especially in the circumstances that Vietnam has just signed the European - Vietnam Free Trade Agreement (EVFTA) Therefore, the continuation of study and further improvement to the law on commercial conciliation to resolve current commercial disputes needs to be addressed in the case of Vietnam Due to aforementioned reasons, the author has

chosen the topic "Legal framework for commercial conciliation in Vietnam – From theory to practice " to complete the Master's thesis

2 Literature review

2.1 Domestic studies

In Vietnam, the law on commercial conciliation has been mentioned and has attracted a lot of research interest in many scientific works and legal journals, typical as:

2.1.1 Before promulgating the Decree No 22/2017/ND-CP

Duong Dang Hue (chairman) (1998), Current methods of resolving economic

disputes in our country and the trend of selection, Ministerial-level scientific topic,

Institute of Legal Sciences, code no 96-98- 032/DT The topic only researches the conciliation in general and the procedures of conciliation at the Court and at Vietnam International Arbitration Center

Tran Dinh Hao (2000), Conciliation, negotiation in the settlement of

economic contract disputes, State and Law Review, Institute of State and Law,

No.141 According to Tran Dinh Hao, conciliation is considered as a method of resolving the next dispute of negotiation; in other words, conciliation is a

2 WTO (Part II - Schedule of Specific Commitments in Services List of Article II MFN Exemptions)

negotiation with the participation of a third party This view does not really reflect the independence of the conciliation process

Tran Ngoc Dung (2004), Settlement of economic disputes by negotiation and

conciliation, Journal of Law, Hanoi Law University, No.1/2004 The author has

given the concept and the principles of conciliation The research initially shows the legal nature of commercial conciliation with in-depth analysis and evaluation

Le Hong Hanh (Chairman) (2010), Improving the law and mechanisms for

resolving disputes outside judicial proceedings, Ministerial-level scientific topics,

Institute of Legal Sciences The research scope of this topic is the disputed resolution methods including negotiation, conciliation and arbitration in civil fields

in general

Luu Huong Ly (2011), Conciliation on trade and the development of

conciliation on trade in Vietnam, Journal of Legislative Studies, No.10 (195),

5/2011 The author analyzes the nature of the conciliation method and pointed out four basic principles of conciliation: voluntary, confidential, objective independent mediator in the process of dispute resolution and conciliation does not affect the use

of other dispute resolution methods of parties

Le Thi Hoang Thanh (2012), Special subject "Completing the reconciliation

mechanism in Vietnam, lessons from foreign experiences", Legal Science

Information, Institute of Legal Sciences, Ministry of Justice, No.9&10/2012 The special subject only shows an overview of common theoretical issues about conciliation

Duong Quynh Hoa (2012), Developing and completing the alternative

dispute resolution mechanisms for commercial relations of the current period in our country, PhD thesis in law, Vietnam Academy of Social Sciences. The thesis has basically clarified the process of developing and completing the alternative dispute resolution mechanism for commercial relations to Vietnam and factors that affect the process of developing the alternative dispute resolution mechanisms However,

this PhD thesis has quite a wide scope of research and has not also clarified the international economic integration for commercial conciliation method

Hoang Minh Khoi, Hoang Bao Ngoc (2015), Confidentiality in out of court

commercial conciliation, Journal of Legislative Studies, No 24 (304), Dec 2015

The article refers to ensuring the confidentiality of information about the Decree draft on commercial conciliation

Phan Thi Thanh Thuy (2016), Resolving the disputes on commercial business

through conciliation in Vietnam: Some legal issues need to be concerned, Journal of

Science of Vietnam National University, Hanoi: Legal Studies, Vol 32, No 2 The study is only focused and analyzed the legal obstacles that need to be concerned and solved so that the conciliation method becomes practical and effective in Vietnam

Overall, it can be seen that there aren’t any authors to study on the theoretical issues of commercial conciliation systematically and basically, as well as examine the practices of the law on commercial conciliation in Vietnam in recent years, especially before promulgating the Decree No 22/2017/ND-CP dated February 24th, 2017 on commercial conciliation

2.1.2 After promulgating the Decree No 22/2017/ND-CP

Le Huong Giang (2017), Some comments on Decree of the Government on

commercial conciliation, The Journal of Legislative Studies, Hanoi Law University,

Economic Law Department This article provides some comments on the legal aspects highlighted in the Decree No 22/2017/ND-CP on commercial conciliation

in order to show some advantages and legal issues that need to be further reviewed for development the commercial conciliation in Vietnam

Le Huong Giang (2019), Completing the law on commercial conciliation in

Vietnam in the context of international economic integration, PhD Thesis, Hanoi

Law University This thesis has studied and evaluated the legal status of commercial conciliation Since then, the author has proposed some solutions to improve the laws

on commercial conciliation in Vietnam

Nguyen Hung Quang (2019), Conciliation - A trend for resolving

commercial disputes in the integration period, The International law and reality

issues in Vietnam, Youth Publishing House, pages 237-253 The article summarizes the advantages of conciliation method and the application of this method to resolve disputes in Vietnam

Ta Dinh Uyen (2019), Singapore Convention on Mediation - A method for

resolving the international commercial business disputes effectively, People's Court

Magazine The article refers to the context of issuance, objectives, scope of application and basic content of the Singapore Convention on Mediation Since then, the author assesses the convenience and difficulties of Vietnam if participating

in this Convention

Tian Jian (2021), Using commercial conciliation to resolve commercial

disputes between enterprises of Vietnam and enterprises of China, Industry and

Trade Magazine, Long Jun Yunnan Law Firm (China) - Senior Specialist This paper introduces and assesses the characteristics and the important roles of commercial conciliation In addition, the paper evaluates the prospects of using commercial conciliation to resolve commercial disputes between enterprises of Vietnam and enterprises of China when the Singapore Convention on International Trade Mediation has been signed by many countries This paper analyzes the advantages and shortcomings of commercial conciliation in handling commercial disputes Based on the paper’s findings, some solutions are proposed to increase the effectiveness of commercial conciliation in resolving trade disputes between enterprises of Vietnam and enterprises of China in the context of development in bilateral trade between Vietnam and China

Doan Thanh Huyen, Nguyen Thi Chinh, Do Thi Thu Trang, Dalma R

Demeter (2021), The report on the assessment of the ability to join the United

Nations Convention on International Agreement for the dispute resolution to conciliation method of Vietnam The report contributes to provide the additional

documents for the Ministry of Justice and related parties to refer to the policy proposal to improve the efficiency of international commercial disputes

Dang Thuong Hoai Linh (2022), Commercial conciliation from the

perspective of The International law and Vietnamese law, Industry and Trade

Magazine, Research result, University of Information and Communications Technology - Thai Nguyen University The article analyzes the provisions of international and Vietnamese laws on conciliation, procedures and recognition of successful conciliation result Based on that, the author has proposed recommendations to complete the conciliation laws in Vietnam

After the Decree No 22/2017/ND-CP takes effect, there have been more research works on the dispute resolution method by commercial conciliation However, these articles have not really studied all aspects of commercial conciliation Therefore, it is really necessary to continue for studying the topic of commercial conciliation on the basis of referring to the above mention research results in accordance with current practice, especially at the moment Vietnam has signed a Free Trade Agreement with the European

2.2 Oversea studies

David Spencer, Michael Brogan (2006), Mediation Law and Practice,

Cambridge University Press Authors have pointed out four methods of mediation including: settlement mediation, facilitative mediation, transformative mediation and evaluative mediation Settlement mediation and evaluative mediation are suitable for conciliation of commercial disputes

Dwight Golann (2009), Nearing the Finish Line: Dealing with Impasse in

Commercial Mediation, Dispute Resolution Magazine. The author studies the practical skills and situations that commercial conciliators can meet with and how to handle them

Linda C Reif (2007), The use of conciliation or mediation for the resolution

of international commercial disputes, Canadian Business Law Journal, Vol.45 The

content of the journal analyzes the advantages and disadvantages of conciliation in

comparison with litigation or arbitration and the legal provisions of commercial conciliation of Asian Sates, the conciliation rules of UNCITRAL (from 1980 to present) and the International Chamber of Commerce (ICC)

William A Herbert, Giuseppe De Palo, Ava V Baker, Apostolos Anthimos,

Natalia Tereshchenko, and Michael Judin (2011), International Commercial

Mediation, The International Lawyer, Vol.45, No.1 The authors study, compare

and evaluate the law practices on commercial conciliation of some countries such as China, Italy, Slovenia, Greece, Russia, South Africa and explain the differences between these countries' regulations on conciliation

Nadja Marie Alexander and Natasha Tunkel (2021), International

Commercial Mediation and Dispute Resolution Contracts The authors provide an

overview of the basic concepts of conciliation; how it distinguishes itself from other dispute resolution mechanisms, in particular, arbitration; the legal framework; and practical guidelines when drafting a conciliation agreement to the context of international commercial contracts

The above foreign studies on commercial conciliation are valuable reference sources of this thesis to be applied legal comparative analysis and studying an experience lesson for Vietnam in the process of enhancing the law on commercial conciliation

3 Objectives of the Study

The thesis focuses on the following issues:

Firstly, clarifying the theoretical issues on the legal framework for commercial conciliation

Secondly, studying and evaluating the current practices of Vietnam's law on commercial conciliation to compare the advantages and disadvantages of Vietnamese law with the laws of other countries in the world on commercial conciliation such as UNCITRAL Model Law on International Commercial Conciliation, laws of Singapore or laws of Germany

Thirdly, making contributions to improve the laws on commercial conciliation in Vietnam in the context of international economic integration from

the above studies

4 Questions of the Study

In order to solve the above objectives, some research questions are raised during the following research process:

The 1st question: What is commercial conciliation in Vietnam and its legal framework?

The 2nd question: Is the current laws on commercial conciliation in Vietnam capable of meeting the practical requirements and consistent with the legal system

in the context of international economic integration?

The 3rd question: What does the Vietnamese government need to do to improve the law regulations to ensure the development of commercial conciliation method of Vietnam?

5 Subject and Scope of the study

5.1 Subject of the Study

The subject of this study focuses the laws and practice of commercial conciliation

5.2 Scope of the Study

Content limitation: the study focuses the current provisions of laws on commercial conciliation of Vietnam The provisions for commercial conciliation of the UNCITRAL Model Law and some typical countries in the world are reference purposes only

Space limitation: The thesis only studies the laws on commercial conciliation

in Vietnam, mainly is regulated by Decree No 22/2017/ND-CP Other fields such

as civil and labor conciliation will not be mentioned by this thesis The UNCITRAL Model Law and the laws of Singapore are only for reference purposes and comparison to improve the laws of Vietnam

Time limitation: From 1986 to now

6 Methods of the Study

To achieve the set research objectives, the thesis applies some of the following research methods:

The analytical and synthesis method: This method is used to analyze the definition, characteristics and provisions of the law on commercial conciliation in Chapter 1 and Chapter 2

The comparison method: This method is applied to the assessment of the conformity between the UNCITRAL Model Law, the Singaporean Law and the Decree No 22/2017/ND-CP to make proposals for improving the law on commercial conciliation in Vietnam This content is presented in Chapter 3

The statistical method: This method is used to statistics the number of disputes resolved by commercial conciliation more and more increasing to VIAC and VMC Thereby, it shows that the development and improvement to the law on commercial conciliation in Vietnam is necessary to match the current practical situation This content is mainly used in Chapter 3

The systematic method: This method aims to systematize all documents related to the research topic to ensure the logic and science of the thesis

7 Scientific and practical significance of the thesis

7.1 Scientific significance

The thesis has clarified some theoretical issues and analyzed the practices of the laws on commercial conciliation in Vietnam Besides, it has also combined with comparing the laws of some countries to give orientations and solutions for completing to the laws on commercial conciliation of Vietnam

7.2 Practical significance

The orientations, solutions and recommendations given in the thesis contribute to the amendment, supplementation and completion of the provisions of Vietnamese law on commercial conciliation With this study, the thesis can be used

as a reference to resolving commercial disputes by means of commercial conciliation in the context of international economic integration today

8 The expected structure of the thesis

In addition to the Introduction, Conclusion and List of References, the thesis consists of 03 (three) chapters as follows:

Chapter 1 Theoretical grounds of commercial conciliation

Chapter 2 Legal framework for commercial conciliation in Vietnam

Chapter 3 Comparison among UNCITRAL Model Law, Singaporean law and Vietnamese Law on commercial Conciliation – Proposals for the law of Vietnam

CHAPTER 1 THEORETICAL GROUNDS OF COMMERCIAL CONCILIATION

1.1 Definition and legal characteristics of commercial conciliation 1.1.1 Definition of dispute and commercial dispute

Dispute means disagreements or conflicts over interests and obligations between parties in a social relationship that governed by laws

Currently, the concept of commercial dispute is used in many different legal documents Accordingly, commercial dispute means the disagreements and conflicts

of interest in parties involved in commercial business activities

The concept of commercial dispute has mentioned for the first time of the

Commercial Law in 1997 as follows: “A commercial dispute is a dispute arising

from the non-performance or improper performance of a contract in commercial activities”3

The Ordinance on Commercial Arbitration in 2003 has not provided a definition of a commercial dispute However, this Ordinance has mentioned on the

concept of "commercial activities" Accordingly, “Commercial activities mean the

performance of one or many trading acts by business people or organizations, including goods purchase and sale, service provision; distribution; trade representation and agency; consignment; renting and lease; hire purchase; construction; consultancy; technology; licensing; investment; financing; banking; insurance; exploration and exploitation; transport of goods and passengers by air, sea, rail, land , and other commercial acts as prescribed by law”4 Therefore, a commercial dispute is a dispute that occurs to the business fields specified in this article

3 Article 238 of The Commercial Law No 58/1997/L-CTN dated May 10, 1997

4 Clause 3, Article 2 of The Ordinance on Commercial Arbitration No 08/2003/PL-UBTVQH dated February 25, 2003

The Commercial Law in 2005 also uses the term "commercial dispute" 5 to refer to disputes arising from commercial activities At the same time, the

Commercial Law in 2005 has explained "Commercial activities mean activities for

the purpose of generating profits, including: sale and purchase of goods, provision

of services, investment, commercial promotion and other activities for the profit purpose" 6 In addition, the Law on Enterprise in 2020 also explains the term

"Business" as follows: “Business” or “Business operation” means continuous execution of one, some or all stages including investment, manufacturing, sale or provision of services on the market for profit7

Therefore, commercial dispute means the disagreements or conflicts over rights and obligations between parties in during performing the commercial activities These conflicts will arise if one party or parties breaks the commitments and the other party believes that its legitimate rights and interests are violated

Commercial dispute is often identified by some of the following characteristics:

(i) First, commercial dispute must arise from the disagreements or conflicts over rights and obligations between parties in commercial activities The basis of arising a dispute is usually the breach of contract or violation of the law by the parties Moreover, the business activities of parties must be for profit purposes such as buying and selling goods, providing services, investing and commercial promotion or other profitable activities

(ii) Second, conflicts arise mainly from business activities between traders Commercial dispute is mainly dispute arising traders (individuals, organizations with business registration) Traders are the main subject

5 Article 317 and Article 319 of Commercial Law No 36/2005/QH11 dated June 14, 2005

6 Clause 1, Article 3 of Commercial Law No 36/2005/QH11 dated June 14, 2005

7 Clause 21, Article 4 of Law on Enterprise No 59/2020/QH14 dated June 17, 2020

of commercial disputes In addition, if the other party conducts profit activities but these individuals and organizations have chosen to apply the Commercial Law to resolve disputes, this is also considered a commercial dispute8

non-(iii) Third, commercial disputes are usually material disputes and high value

(iv) Fourth, when a dispute arises, the parties have the right to choose a competent authority to resolve the dispute or abide by the agreements

stated in the Contract

1.1.2 Definition of commercial conciliation

During the implementation of civil transactions, the parties often have conflicts over rights and obligations These disputes are usually resolved by court or commercial arbitration (if within the jurisdiction of commercial arbitration and the parties have an arbitration agreement) In addition to the above dispute resolution methods, there are some of the other methods that can help the parties resolve the dispute and have a new agreement to help the parties continue to perform civil transactions One of the methods of resolving this dispute is conciliation

The concept of conciliation has been used for a long time to reflect the dispute settlement of parties to good faith and with the help of a third party The term "conciliation" is used not only to describe the settlement of disputes between individuals but also the settlement of disputes between interest groups, between peoples or nations in order to find a common voice and make peace

Conciliation is considered a traditional means of resolving disputes in social life which has existed for a long time in human history Around the world, Alternative Dispute Resolution ("ADR")9 including conciliation and arbitration

8 Clause 3, Article 1 of Commercial Law No 36/2005/QH11 dated June 14, 2005

9 State Library, dispute-resolution , accessing on December 12, 2022

https://legalanswers.sl.nsw.gov.au/hot-topics-78-you-and-your-lawyer/alternative-have been used as early as 1800 BC by the Kingdom of Mari (now Syria) in settling disputes with other kingdoms

Black’s Law Dictionary has defined Conciliation as “A settlement of a dispute in an agreeable manner or a process in which a neutral person meets with the parties to a dispute and explores how the dispute might be resolved; esp., a relatively unstructured method of dispute resolution in which a third party facilitates communication between parties in an attempt to help them settle their differences”10 According to the Vietnamese’s Law Dictionary, conciliation is the persuasion of disputing parties to settle their own disputes satisfactorily

According to the Germany’s Mediation Act: "Mediation is a confidential and

structured process in which the parties strive, on a voluntary basis and autonomously, to achieve an amicable resolution of their conflict with the assistance of one or more mediators"11 According to the UNCITRAL Model Law

on International Commercial Mediation of the United States: "Mediation means a

process, whether referred to by the expression mediation, conciliation or an expression of similar import, whereby parties request a third person or persons (“the mediator”) to assist them in their attempt to reach an amicable settlement of their dispute arising out of or relating to a contractual or other legal relationship The mediator does not have the authority to impose upon the parties a solution to the dispute"12 According to the Singapore's Mediation Act: "Mediation means a

process comprising one or more sessions in which one or more mediators assist the parties to a dispute to do all or any of the following with a view to facilitating the resolution of the whole or part of the dispute: (a) identify the issues in dispute; (b)

10 Bryan A Garner, Black’s Law Dictionary, 8 th ed 2004, page 873

11 Clause 1, Article 1 of Germany’s Mediation Act 2012, internet.de/englisch_mediationsg/englisch_mediationsg.html , accessing on September 11, 2022

https://www.gesetze-im-12 Clause 1, Article 1 of UNCITRAL Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation (2018)

explore and generate options; (c) communicate with one another; (d) voluntarily reach an agreement"13

In Vietnam, author Tran Dinh Hao has introduced the concept of

“Conciliation is a next form of dispute resolution, in which the parties to the negotiation process to involve an independent third party mutually accepted or appointed as a mediator to assist the parties to finding appropriate solutions to conflict resolution in order to put an end to disputes and disagreements"14 Author

Nguyen Thi Minh has described that “Conciliation is a process that the disputing

parties use a neutral party or third parties to regularly dissect each disputed issue

to seek different solutions in order to meet the requirements of the parties so that the parties can reach an agreement on the dispute settlement decision" In general,

the authors have a relatively unified understanding of conciliation Accordingly, conciliation is a method to resolve disputes with the participation of a neutral third party to help disputing parties to resolve their conflicts voluntarily

With the promulgation of Decree No 22/2017/ND-CP dated December 24th,

2017, commercial conciliation is a method of resolving commercial disputes agreed upon by involved parties with the assistance of a commercial conciliator acting as

an intermediary in accordance with this Decree15 This Decree No 22/2017/ND-CP has mentioned "commercial conciliation" That means, commercial conciliation is composed of two elements, "conciliation" and "commercial" Accordingly,

"conciliation" refers to the method of implementing dispute settlement and

"commercial" refers to the type of dispute So, the definition of commercial conciliation in Vietnam is similar to the definition of "conciliation in general", but called "commercial conciliation" to refer to the conciliation of commercial disputes

13 Clause 3, Article 1 of Singapore's Mediation Act 2017, https://sso.agc.gov.sg/Act/MA2017#pr3- , accessing on September 11, 2022

14 Trần Đình Hảo (2000), Hòa giải, thương lượng trong việc giải quyết tranh chấp hợp đồng kinh

tế, Tạp chí Nhà nước và pháp luật, Viện nghiên cứu Nhà nước và Pháp luật, số 141

15 Clause 1, Article 3 of Decree No 22/2017/ND-CP dated December 24, 2017

and within the scope of legal documents on commercial dispute settlement activities

* Distinguishing between conciliation and mediation:

The distinction between the two concepts of "conciliation" and "mediation"

is also a controversial issue Scholars around the world also trend to not distinguished these two concepts clearly According to authors Colbran, Reinhardt, Spender, Jackson and Douglas16, conciliation and mediation are understood as

follows: "Conciliation" is an active negotiation process that the disputing parties,

with the help of a neutral third party (conciliator), identify the issues in the dispute, develop and review the relevant factors, choose and try to reach an agreement Raised and resolved issues include not only legal issues but may also include interests and needs that the parties consider important "Mediation" is a process

whereby the parties, with the help of a neutral third party (mediator), identify the issue in dispute, consider the possibilities and choose to reach a mutual agreement This is a process similar to conciliation The mediator acts only as an advisor but not as a decision maker Another opinion also said that, in conciliation, the conciliator makes recommendations of disputed issues and proposes a conciliation plan for the parties to come to a final conclusion In mediation, the mediator determines the issues of the settlement process and creates favorable conditions for the parties to reach a final agreement Some others argue that conciliation is a "non-binding arbitration" method, while mediation is considered "assisted negotiation"

In other words: Conciliation involves a third party that tries to help disputing parties

to heal their own conflicts, while mediation goes further by allowing the third party

to suggest the terms of the dispute resolution

The UNCITRAL Model Law also defines "conciliation means a process,

whether referred to by the expression conciliation, mediation or an expression of

16 Stephen Colbran, Greg Reinhardt, Peta Spender, Sheryl Jackson, Roger Douglas (2010), Civil Procedure: Commentary & Material 4 th Edition, Chapter 2: Alternative dispute resolution,

LexisNexis

similar import"17 Similarly, the Singapore Convention explains that “mediation” means a process (whether referred to by the expression “mediation” or

“conciliation” or any term of similar import)18 Clause 3, Article 14 of this Decree

No 22/2017/ND-CP provides that: "At any time in the conciliation process, a

commercial conciliator may put forth proposals for dispute resolution" That is the

reason that the author has used the term "conciliation" in this thesis

From the above analysis, commercial conciliation can be understood as follows: Commercial conciliation is an independent commercial and business dispute resolution method Accordingly, the dispute settlement takes place according to a voluntary, confidential procedure with the participation of the disputing parties and a neutral third party (called a “commercial conciliator”) selected by the parties Commercial conciliators assist disputing parties to reach an agreement on a self-determination basis

1.1.3 Legal characteristics of commercial conciliation

Commercial conciliation has some characteristics as follows:

The first, conciliation is a non-procedural dispute resolution method In some countries around the world, conciliation is considered an "alternative" disputes resolution method (Alternative Dispute Resolution - ADR) Here, "alternative" implies distinctions between qualitative and procedural form, which include a set of principles and provisions that may be in opposition to the principles and operational provisions of the Court In this context, "alternative" also implies an option, the parties knowingly choosing to use mediation because of perceived advantages over litigation19

17 Clause 3, Article 1 of UNCITRAL Model Law on International Commercial Conciliation

18 Singapore Convention on Mediation Act 2020, https://sso.agc.gov.sg/Act/SCMA2020 , accessing

on April 5, 2023

19 ThS Dương Quỳnh Hoa – Viện Nhà nước và Pháp luật (2011), Hòa giải – Một phương thức giải quyết tranh chấp thay thế, http://www.lapphap.vn/Pages/tintuc/tinchitiet.aspx?tintucid=207706

The second, conciliation has the participation in an intermediary that helps the parties reach an agreement on a solution to the dispute This intermediary only plays a supporting role, helping the parties to find the best solution to resolve the dispute, while the dispute settlement is still decided by the parties The conciliator must be someone that is independent of the parties, has no interest in dispute problem and also does not have the power to make a judgment The neutrality of the conciliator creates the trust in the parties to resolving the dispute

The third, the parties can decide, change and establish the agreement results from dispute settlement according to the goodwill and voluntariness of the parties

The fourth, the conciliation result is binding on the parties according to the provisions of civil law However, the conciliation result is not coercive for judgment enforcement

1.2 Classification of commercial conciliation

1.2.1 Base on the methods of commercial conciliation

In the development history of conciliation, there have been at least two major schools of conciliation, with the same purpose of helping parties to resolve their disputes, specifically as follows20:

Evaluative mediation21: According to this mediation strategy, the mediator assesses the issues that are the most critical to the dispute and seeks to some extent orient and lead the parties to a successful mediation agreement in accordance with their assessment At the highest level of this school, the mediator will guide and orientate the overall outcome of the dispute resolution The mediator assumes that the parties need and want the mediator to guide and orientate them on appropriate grounds for dispute resolution based on legal grounds, expertise and problem-solving practices The mediators' ability to resolve this dispute is based on their

20 Leonard L Riskin (1996), Understanding Mediators’ Orientations, Strategies, and Techniques: A Grid for the Perplexed, Harvard Negotiation Law Review Vol 1 No 7 (1997), page 23 - 32

21 "Mediation" is understood similar to "conciliation" Depending on the context which the author has used this term to match the content of the original document for reference

experiences and objectivity With this assumption, the mediator will find to help the parties know the strengths, weaknesses and potential outcomes of the case or any other outcome of the dispute if the parties do not reach a successful mediation To

do this thing, mediator must have a level of understanding that is at least equal or better than the parties In addition, mediators also need to carefully study the documents related to the dispute On that basis, the mediator can propose compromise options on the parties based on their strengths and weaknesses Currently, evaluative mediation is still widely used in some countries and areas such

as in the United States However, this form is currently being criticized a lot by the modern mediator community because of its rigidity and especially this method easily leads to deadlock because the parties still maintain the positional negotiation status22

Facilitative mediation23: In contrast to above evaluative mediation, the mediator approaches according to supportive strategy without trying to assess the issues that are critical to the dispute or find to orient or lead the parties to a mediation agreed outcome that mediators think appropriately With this facilitative mediation method, the mediator only "supports" the negotiation process to help the parties better understand and remove misunderstandings and adverse factors in the negotiation process The parties will find successful mediation results from them under the guidance of the mediator in a fair and transparent mediation process Mediators of the facilitative mediation school assume that the disputing parties are highly intelligent and able to cooperate with each other and understand their own situation better than the mediator or their attorney Therefore, the parties can develop their better dispute resolution options than what the mediator can suggest The mediator has only the most important task for enhancing mutual understanding

22 CIArb Handbook on Mediation (2014), page 11

23 Models of Mediation, Steve Hindmarsh Ltd, advice/models-of-mediation , accessing on January 12, 2023

https://www.stevehindmarsh.co.uk/help-and-of the parties, clarify opinions, views and interests in order to enhance communication between the parties to help them make decisions on dispute resolution With this strategy, the mediator will use skills such as making friends, asking, listening, exchanging information to help the parties carry out negotiations

more effectively than face-to-face negotiations without mediation

1.2.2 Base on the forms of commercial conciliation

In Vietnam, before having the Decree No 22/2017/ND-CP, both domestic laws and International Treaties to which Vietnam joined and signed that were recorded negotiation and conciliation as methods of settling commercial disputes between the parties, typically as follows:

Clause 2, Article 317 of the Commercial Law No 36/2005/QH11 dated June

14th, 2005 provides for forms of resolution of disputes including "Conciliation between the parties by an agency, organization or individual selected by the parties

to act as the conciliation mediator"

Clause 1, Article 338 of the Vietnam Maritime Code No 95/2015/QH13 dated November 25, 2015 stipulates: “Disputing parties may settle maritime disputes by entering into negotiations, agreements or submitting claims to the competent Arbitration or Court”

Clause 1, Article 14 of the Law on Investment dated June 17, 2020 stipulates: "Disputes over business investment activities in Vietnam shall be settled through negotiation and conciliation If the negotiation or conciliation fails, the dispute shall be settled by an arbitration body or by a court in accordance with Clauses 2, 3, and 4 of this Article"

The Vietnam - United State trade agreements, the Agreement on the promotion and protection for investment of Vietnam - India, Vietnam - Bulgaria, Vietnam - Laos all encourage the use of out-of-court settlement methods as appropriate settlement methods of disputing parties

Decree No 22/2017/ND-CP has specifically defined commercial conciliation

as well as created a legal framework for this method of dispute resolution However,

before Decree No 22/2017/ND-CP was promulgated, conciliation existed in many other dispute resolution activities, specifically as follows:

Conciliation at a court and arbitration institution (also known as conciliation in proceedings): Conciliation in proceedings is a conciliation activity

that takes place during the proceedings to resolve a lawsuit in court or arbitration Conciliation in civil proceedings is a mandatory procedure under the Civil Procedure Code No 92/2015/QH13 dated November 25th, 201524 In this form of conciliation, the judge will act as the conciliator who runs the conciliation session and will apply generally the same approach as the evaluative mediation The conciliation result (if it is successful) is the agreement on the involved parties to the settlement of the dispute that the court recognizes the successful conciliation result This result is not appealed and shall take implementation effect immediately Conciliation in arbitration is not a mandatory procedure However, arbitrators and the Arbitration Council always encourage the parties to mediate to resolve disputes The result of a successful dispute settlement agreement will be decided by the arbitrator and the Arbitration Council to recognize the agreement to the parties This decision is final and as valid as an arbitral award25

Conciliation on the premises: Conciliation on the premises means that conciliator guides and assists the parties to reach an agreement and resolve their conflicts, disputes or violations of the law voluntarily in accordance with this Law26 The geographical scope of conciliation on the premises includes hamlets, villages,

24 Clause 1, Article 205 of the Civil Procedure Code No 92/2015/QH13 dated November 25 th , 2015 stipulates the court's responsibilities for conciliation: "During the period of preparation for the first- instance trial over cases, the Courts must carry out conciliation for the involved parties to reach agreement on the resolution of the cases, except cases which must not be mediated or cannot be mediated as stipulated in Articles 206 and 207 of this Code or cases settled under simplified procedures"

25 Article 58 of the Law on Commercial Arbitration No 54/2010/QH12 dated June 17, 2010 provides for Conciliation and recognition of successful conciliation

26 Clause 1, Article 2 of Law on Conciliation on the premises No 35/2013/QH13 dated June 20,

2013

hamlets, civil groups, quarter and other residential communities This is a form of conciliation and dispute resolution to individuals, families and organizations in the residential communities that has existed for a long time in Vietnamese life This form of conciliation is usually informal The conciliator (usually a person of good moral character, reputable in the community) can conduct conciliation flexibly depending on the needs of the parties The result of successful conciliation is binding under civil law However, it is not enforceable

Conciliation in labor disputes: Some labor disputes must go through

conciliation before filing a lawsuit in Court27 For this form of con conciliation, the labor conciliator (appointed by the Chairman of the provincial People's Committee) needs to have experience and knowledge of labor law to conduct the mediation session and help the disputing parties who are employees and employers to resolve labor disputes Unlike conciliation on the premises, the orders and procedures of labor conciliation are regulated very detail and strictly in the 2019 Labor Code Successful conciliation results are binding under civil law but there are not an

enforcement mechanism like a court judgment

1.3 The advantages of commercial conciliation

Besides the disadvantages of commercial conciliation method such as the parties can stop resolving the dispute to choose another settlement method at any time during the conciliation process or the conciliation results depends entirely on the decision of the disputing parties, commercial conciliation has many outstanding advantages as follows:

For flexibility: Commercial conciliation can conduct in many different environments, circumstances and simplifies the procedures as agreed by the parties Flexibility helps the parties go directly to the nature of the dispute, avoiding complicated procedural requirements, saving time and effort to resolve the dispute

In addition, the flexibility of commercial conciliation is reflected on the absence of requirements for verification of information, evidence or procedural review

27 Article 188 of Labor Code No 45/2019/QH14 dated November 20, 2019

For friendliness: Commercial conciliation does not regulate the place, space

or style, language, communication behavior and conduct of the participants in the conciliation These factors are actively agreed or implemented by the parties in accordance with the culture of the disputing parties However, the conciliator may also ask the parties to use polite language The friendliness of conciliation makes the disputing parties feel closer and more intimate It does not create an atmosphere

of anxiety and stress compared to court proceedings

For dispute resolution method: Focus on resolving the real desires for the disputing parties and put the parties at the most center position of conciliation The parties are free to make their own decisions without having to apply the binding rules and principles of the courts Parties reach the agreement on the basis of mutual interests but it must be a legal agreement The parties can decide on the conciliation plan and know the results right at the conciliation This is an important distinction between dispute resolution of court

For the participation by the parties: The disputing parties directly participate

in the conciliation process The parties can talk, negotiate and discuss solutions to the entire conciliation process The conciliation process provides an opportunity for the parties to express their views as well as to present, explain, and offer thanks and apologies to each other28 This is an important step in resolving disputes between the parties29 Disputing parties often come up with options that are beneficial to their side However, after the negotiation process, the final conciliation result is easily supported by the parties because parties realize that they are the masters of the conciliation process and have the right to decide the issues themselves The

28 L Mulcahy and authors (2000), Mediating Medical Negligence Claims, NHS Executive, page XVII

29 F E A Sander and S B Goldberg (1994), A user – friendly guide to selecting on ADR procedure, Negotiation journal

conciliation process also helps the parties learn lessons about problem solving that can be applied to similar situations in the future30

For the maintenance of the relationship between the parties: Dispute resolution by conciliation helps the parties maintain a relationship because conciliation focuses on considering the actual interests and concerns of the parties Besides, the dispute resolution procedure is not complicated The parties can freely express their wishes, feelings and make their own decisions related to disputes in the spirit of mutual benefit Therefore, these factors make mediation a much more flexible method of dispute resolution than court proceedings

For non-disclosure of information: Information relating to a conciliation case shall be kept confidential, unless otherwise agreed upon in writing by involved parties or otherwise prescribed by law31 According to the UNCITRAL Model Law

on commercial conciliation32 and the conciliation rules of some conciliation centers, parties to conciliation may not provide information about conciliation for subsequent proceedings This rule is intended to promote openness, frankly sharing and solution-building to promote reconciliation

1.4 The process of forming the commercial conciliation laws in Vietnam

In Vietnam, conciliation is an out-of-court dispute resolution method When Vietnam was a colony of France in the period from the late 19th century to the middle of the 20th century, the Court was the main place to settle disputes in Vietnam During this time, conciliation was not developed After the August revolution to the war for resistance to the French in 1954, the economy operated on

a centrally planned mechanism, so it did not create conditions for commercial business transactions to develop Therefore, conciliation is also ignored Even in the field of foreign trade, the existence of the Foreign Trade Arbitration Council and the

30 M Power (1992), Training of mediators, 3, ADRJ 214, page 214 – 215

31 Clause 2, Article 4, Decree No.22/2017/ND-CP on Commercial Conciliation

32 Article 10, UNCITRAL Model Law on International Commercial Conciliation with Guide to Enactment and Use 2002

Maritime Arbitration Council was under the management and dependence on the Ministry of Foreign Trade and the Ministry of Transport at that time The methods

of settling commercial and business disputes outside the courts are generally only formed and developed when the economy changes to a market economy However, even the initial legal documents, there was no conciliation method of civil and economic dispute resolution methods The Ordinance on Economic Contracts of the State Council No 24-LCT/HDNN8 dated September 25, 1989 only mentioned in Article 7: “Disputes arising from the performance of economic contracts shall be settled by self-negotiation between the parties or submit to economic arbitration" The Ordinance of the State Council No 52-LCT/HDNN8 dated May 7, 1991 on civil contracts also does not mention the method of conciliation of the fields of civil, business and commercial disputes

The laws on commercial conciliation in Vietnam were issued quite late compared to the other dispute resolution methods The process of forming the laws

on commercial conciliation in Vietnam is divided into two major periods as follows:

* From 1995 to before 2015: This period does not specify the content of the laws on commercial conciliation

Before the promulgation of the commercial conciliation laws, the development of the civil, business and commercial legal system in Vietnam also mentioned the existence of the conciliation method

In civil law system, the “principle of conciliation” of civil disputes is specified in Article 11 of the Civil Code (1995), Article 12 of the Civil Code (2005) and Article 7 of the Civil Code (2015) Accordingly, the State's opinion on civil disputes is to encourage using the conciliation between the parties in accordance with the law

In the legal documents which are governing commercial relations, the commercial conciliation method of Vietnam was first recognized in the Commercial Law 1997 From the time the Commercial Law 1997 took effect on January 1, 1998, conciliation was really known After that, Article 317 of Commercial Law 2005,

this conciliation continues to recognize: "Conciliation between the parties by a body, organization or individual selected by the parties to act as the conciliation mediator" but the legal basis for commercial conciliation is still not really clear In Clause 1, Article 14 of the Law on Investment 2014, it continues to provide for the encouragement of the use of conciliation method to resolve business investment disputes In addition, Article 33 to Article 37 of the Law on Protection of Consumer's Rights in 2010, there are also provisions for conciliation of disputes between consumers and organizations or individuals trading goods and services

However, the common point of these Laws only proposes to using the conciliation without providing the content of the conciliation method Especially, there are no specific regulations on the conciliator such as a conciliation center or conciliator, specific procedures and legal validity of the conciliation results Therefore, the above provisions cannot be applied in practice if the Authorities have not issued an official legal document to regulate the commercial conciliation method of the disputing parties

* From 2015 to present: This period has prescribed specific legal content of commercial conciliation (the National Assembly promulgated the Civil Procedure Code in 2015, the Government issued the Decree No 22/2017/ND-CP in 2017)

The first specific legal content of commercial conciliation is prescribed in the Civil Procedure Code in 2015 One of the civil requirements under the jurisdiction

to settle at the Court is "recognition of the successful out-of-Court conciliation result" This content is specified in Chapter XXXIII on the procedures for recognition of the successful out-of-Court conciliation result (from Article 416 to Article 419) This is considered as a signal that the Government will continue to promote the of out-of-Court conciliation method and issue legal documents to guide more specifically on this conciliation method At this time, the plan to issue a Decree on commercial conciliation has been established from Decision No.1148/QD-BTP dated May 16, 2013 of the Minister of Justice on the

establishment of a Drafting Committee to develop a draft of Decree on commercial conciliation

According to data onto the Government Report on the draft of the Decree on commercial conciliation, professional commercial conciliation activities through the issuance of the Code of Conciliation by the Vietnam International Arbitration Center (VIAC) and provided this service in 2007 Meanwhile, professional conciliation services provided by conciliation centers have formed and developed stably in the world and countries in the region The number of cases resolved through conciliation method is very large, such as the China International Economic and Trade Arbitration Commission (CIETAC), the Hong Kong Mediation Center, the Singapore Mediation Center and the Thai Mediation Center In response to the demands of the dispute settlement practice in Vietnam, the needs of businessman and ensuring the implementation of commitments to the World Trade Organization (WTO), Government issued Decree No 22/2017/ ND-CP dated February 24, 2017

on commercial conciliation under Decision No 808/QD-TTg dated June 29, 2012

of the Prime Minister on the promulgation of an action plan to implement the overall strategy of Vietnam's service area development up to 2020

In order to improve the legal framework of commercial conciliation in Vietnam, the Ministry of Justice issued the Circular No 02/2018/TT-BTP dated February 26, 2018 to guide the use of some forms of the organization and operation

of commercial conciliation This Circular applies to conciliators, commercial conciliation centers, branches and representative offices of commercial conciliation centers; foreign commercial conciliation organizations establish branches and representative offices in Vietnam; the State management agency of commercial conciliation and other relevant agencies, organizations and individuals The Circular promulgates 24 (twenty-four) forms of the state management of administrative procedures in commercial conciliation activities

CONCLUSION OF CHAPTER 1

Commercial conciliation is promulgated on the basis of the theory of free will and voluntary agreement in private relations Commercial conciliation is developed in the market economy and will increasingly develop in the context of economic integration The introduction to commercial conciliation is also a step to develop the business freedom of traders in Vietnam

Commercial conciliation is an independent dispute resolution method compared to other commercial dispute resolution methods such as negotiation, arbitration or court In Vietnam, commercial conciliation is being encouraged through policies and guidelines of the Party and State In 2017, the Government issued Decree No 22/2017/ND-CP on commercial conciliation to stipulate legal issues about commercial conciliation, recognize the legal status of the conciliator and other issues with the settlement of disputes by conciliation

It is necessary to continue to study and evaluate the practical legal provisions

of Vietnam on commercial conciliation Clarifying the content that is appropriate and progressive and at the same time needing to be supplemented and completed content that is not suitable to help commercial conciliation really become the first choice method of enterprises when dispute arises Therefore, it is necessary to consult and compare Vietnam's regulations on commercial conciliation with other countries such as the UNCITRAL Model Law and the Singapore's Mediation Act

CHAPTER 2 LEGAL FRAMEWORK FOR COMMERCIAL CONCILIATION IN VIETNAM

2.1 Provisions of the laws on commercial conciliator

2.1.1 Provisions on condition for practicing commercial conciliator

Commercial conciliator is an individual that resolves commercial disputes directly by conciliation In Vietnam, commercial conciliator is first recognized in

Clause 3, Article 3 of Decree No 22/2017/ND-CP "Commercial conciliator may be

an ad hoc commercial conciliator or a commercial conciliator of a commercial conciliation institution who is selected by involved parties or appointed by a commercial conciliation institution at the request of involved parties to assist them

in dispute resolution in accordance with this Decree" Therefore, a commercial

conciliator in Vietnam can provide conciliation services either independently or as a conciliator of a commercial conciliation institution For conducting the legal commercial conciliation, a commercial conciliator needs to meet two factors as follows:

(i) Meet the conciliator's standards as required by law;

(ii) Recognize by a competent State agency or a conciliation institution

2.1.1.1 Qualifications of a commercial conciliator

The first, for capacity for acts of an individual and moral qualities: To become a commercial conciliator, a commercial conciliator must have full capacity for acts of an individual in accordance with the provisions of the Civil Code 2015 It

refers to "The capacity for acts of an individual is his/her capability to establish and

exercise civil rights and perform civil obligations to his/her acts"33 In addition, this Decree also mentions other qualitative standards applicable to commercial

conciliators such as: "having good moral qualities and prestige, and working in an

independent, impartial and objective manner" 34 However, these are moral qualities

33 Article 19 of Civil Code No 91/2015/QH13 dated November 24, 2015

34 Point a, Clause 1, Article 7 of Decree No 22/2017/ND - CP dated February 24, 2017 on Commercial Conciliation