Khóa luận tốt nghiệp: The exemption from liability in contracts for the international sale of goods under CISG and Vietnamese law

Thisunderscores the importance of the liability exemption regime in intemationalgoods sales contracts, which not only ensures the rights of the parties but alsoshares risks and provides

MINISTRY OF JUSTICE MINISTRY OF EDUCATION & TRAINING

HANOI LAW UNIVERSITY

GRADUATION THESIS

Advisor:

LLM Tran Thu Yen

Confirmation of the advisor

DECLARATION

I hereby deciare that this is my ownresearch, the conclusions and data inthe thesis are truthful and reiiabie./

Graduation thesis author

LIST OF ABBREVIATIONS

CISG : United Nations Convention

on Contracts for theInternational Sale of Goods PICC : Principles of Intemational

Commercial Contract

UNCITRAL : United Nations Commission on

International Trade Law

UNIDROIT : The International Institute for the

Unification of Private Law

LIST OF ABBREVIATIONS

1 Subject background Ta l38g4o0sprasalf

2 Research status of the thesis

3 Scientific significance and practical significance of the thesis

4 Purpose and missions of the thests 02 cccccecescseecsessns eens eeseeecneenene

5 The subject and the scope of the research - (co

6 Methodology

7 Structure of the thesis

CHAPTER 1: GENERAL THEORETICAL ISSUES OF THE EXEMPTIONFROM LIABILITY IN CONTRACTS FOR THE INTERNATIONAL SALE

nun fk Ww

1.1 Concept of contracts for the international sale of goods 71.1.1 Definition of contracts for the international sale of goods 71.1.2 Characteristic of contracts for the intemational sale of goods 9

1.2 The concept of exemption from liability in international goods sales

1333 Characteristics of Exeenption from Liability in iitemati onal Goods

Salles Combats ase cinsescceivsssscecosssnessrnsseesiestosscesssoanucceaneseneearas ee 141.3 Sources of law governing the issue of liability exemption in intemational

1.3.1 Intemational treaties ee E1.3.2 National law AGlE1312E1S0S5d13888:1gãci4sasueksssagaszazrsusua-ae LO13.3 Other sources OP LAW: sw csicsccsuccctia ni cniiaecs LD

CHAPTER 2: PRACTICAL APPLICATION OF REGULATIONS ON THEEXEMPTION FROM LIABILITY IN CONTRACTS FOR THEINTERNATIONAL SALE OF GOODS UNDER CISG AND VIETNAMESE

2.1 Regulations on the exemption from liability in contracts for theintemational sale of goods under CISG and Vietnamese law Pee el2.1.1 Exemption from liability due to obstacles encountered by the

3:1:3 Exemption from liability dias: to othe ‘fault of the violating ae

Exemption from liability due to fault of the violated party according rs

CISG reg ulatt O88 sec ccoekciaiseoseisieonkiadaggnseaoosg sept 392.2 Exemption from liability due to problems with a third party related to apatty to the contract under CISG ‹iscccssccsuasoaaaaasesgtssasoe62.3 Provisions on the exemption from liability in contracts for theintemational sale of goods under Vietnamese law 50

2.3.1 Exemption from liability as agreed upon by the pattiesin the: contract

50

335 ÏE Serprign fron liability ue) to inaplementation of decisions of

competent state management agencies 433CONCLUSION OF CHAPTER 2 S6CHAPTER 3: RECOMMENDATION TO COMPLETE VIETNAM'S LAW

ON THE EXEMPTION FROM LIABILITY IN CONTRACTS FOR THE

3.1 Advantages and disadvantages of applying regulations on the exemptionfrom liability in contracts for the international sale of goods under

Vietnamese law yA

31.1 ‘Advantages ‘of applying ‘regulations 0 on nthe exemption from! liability

in contracts for the intemational sale of goods under Vietnamese law 573.1.2 Disadvantages of applying regulations on the exemption fromliability in contracts for the international sale of goods under Vietnamese

3.2 Proposal to improve Vietnamese law on the exemption from liability incontracts for the intemational sale of go0ds - . -52 -i -.- O4

3.3 Recommendations to improve the effectiveness of law enforcement onthe exemption from liability in contracts for the intemational sale of goods

67

1 Subject background

In the current era of globalization, Vietnam and many countnes areactively promoting intemational trade activities to integrate into the worldeconomy The international sale of goods, primarily through contracts, is acrucial component of these trade transactions, playing a significant role in thegrowth process of the global economy

As the international sale of goods continues to develop, it isaccompanied

by a conceming trend-an increase in disputes related to this activity Thisunderscores the importance of the liability exemption regime in intemationalgoods sales contracts, which not only ensures the rights of the parties but alsoshares risks and provides a legal escape for the violating party when not entirely

at fault

Therefore, a comprehensive study of the exemption from liability incontracts for the international sale of goods under CISG and Vietnamese lawwill provide an overview of this issue, thereby giving some opinions to improvecurrent Vietnamese law and creating a basis for Vietnamese traders toproactively protect their legitimate nghts and interests when entering intocontracts for the international sale of goods

The topic “The exemption from liability in contracts for the intemationalsale of goods under CISG and Vietnamese law’ has an important role andpractical significance not only in terms of law but also in practical terms, which

is also why I chose this as a research topic for my graduation thesis

2 Research status of the thesis

Up to the present time, there have been several research projects on “Theexemption from liability in contracts for the intemational sale of goods underCISG and Vietnamese law.” Specifically:

2.1 Domestic research status

Regarding the monographs, the book “Contracts for the InternationalSale of Goods under CISG — Regulations and Case Lav ”, published by theJudicial Publishing House in 2021, can be cited This book is the researchwork of all lecturers of the Faculty of Intemational Trade and Business Law

of Hanoi Law University, compiled and analyzed thoroughly and quicklyunderstood the provisions of the United Nations Convention on Contracts forthe Intemational Sale of Goods along with 200 case laws, including theexemption from ability in contracts for the international sale of goods, which

is focused in Chapter 11 of the book The book analyzes cases of liabilityexemption according to the provisions of law through specific case law,thereby providing comments on the application of liability exemption inintemational goods sales in practice.

Some research works focus on one of the cases of liability inintemational sales contracts, specifically: “Exemption from liability for thirdparties according to Clause 2, Article 79 of the Convention on Contracts forthe International Sale of Goods: viewed from a comparative law perspective”

by authors Tran Thanh Tam and Pham Thanh Cao in 2017, using the method

of comparative law and analyzing related laws, the article shows how toexplain Clause 2, Article 79 of the Convention on Contracts for theInternational Sale of Goods is used and discussed to discuss intemal lawissues when Vietnam is a CISG member, “Discussing the exemption ofliability in cases of force majeure in current international goods purchase andsale contracts” by author Tran Van Duy in 2013, the author gives someopinions to clan fy the issue of exemption of liability, in case of force majeure

in an intemational goods sale contract: Regarding liability, exemption fromliability, on the issue of force majeure and the current situation of applicationand some problems that need to be overcome; “The issue of exemption from

thesis by author Le Thi Huyen Trang advised by LLM Tran Van Huy in 2011Proposing legal content on force majeure events, criteria for determining forcemajeure events, legal basis for exemption from liability in force majeure

situations.

2.2 Foreign research status

“Digest of Case Law of the United Nations Convention on theContracts for the International Sale of Goods” (2016 edition) is the latestofficial foreign reference published by the United Nations Commission OnInternational Trade Law (UNCITRAL) This work analyzes in detail all theprovisions of the CISG, drawn from the decisions of the dispute settlementagencies in the many law cases that have occurred

Besides, several foreign dissertations and articles studying Theexemption from liability in contracts for the intemational sale of goods underCISG can be mentioned: Lee Wanki, “Exemptions of Contract LiabilityUnder the 1980 United Nations Convention”, Dickinson Joumal ofIntemational Law, Vol 8, Spring 1990, pp 375-376; Harry M Flechtner,

“The Exemption Provisions of the Sales Convention, Including Comments on

“Hardship” Doctrine and the 19 June 2009 Decision ofthe Beigian CassationCourt’, Legal Studies Research Paper Series, Working Paper No 2011-09,University of Pittsburgh School of Law, Juan Pablo Hemandez, “CSGhardship exeynption in the time of COVID-19”, The Treaty Examiner, Issue 2(May 2020), pp 71-79, also research about CISG and the exemption fromliability in contracts for the intemational sale of goods under CISG

3 Scientific significance and practical significance of the thesis

In terms of scientific significance, the thesis conducts comprehensiveresearch on intemational goods sales contracts in general and the exemption

of liability in intemational goods sales contracts in particular, drawn from the basis of regulatory analysis of CISG and Vietnamese law From there, the

study finds recommendations to improve the effectiveness oflaw enforcement

on liability exemptions in intemational goods sales contracts.

Regarding practical significance, the research results of the thesis will

be a valuable scientific reference for leaming about the provisions of CISGand Vietnamese law on liability exemption due to breach of sales contractsfor intemational goods The thesis can also be used as a reference to perfectthe provisions of Vietnamese law on liability exemption due to violations ofintemational goods sales contracts In addition, businesses can pay moreattention to issues of liability exemption when signing and implementingintemational sales contracts, avoiding unnecessary disputes and damages

4 Purpose and missions of the thesis

Regarding the purpose of the thesis research: First, research generaltheoretical issues on exemption from liability due to violation of intemationalgoods sales contracts; Second, clarify the current status of CISG regulationsand Vietnamese law on the issue of liability exemption in goods purchase andsale contracts; Third, make recommendations for Vietnam on the issue ofliability exemption due to violation of intemational goods sales contracts

The thesis researches the general theory of liability exemption inintemational goods sales contracts, clanfies the current status of CISGregulations and Vietnamese law on the issue, and makes recommendations forVietnam on the issue of liability exemption in intemational goods purchase andsale contracts

Š The subject and the scope of the research

5.1 The subject of the research

The research subject is the provisions of CISG and Vietnamese law onthe exemption from ability for the intemational sale of goods In addition, theresearch subject also includes law cases and disputes, as well as theadjudication practices ofthe courts and arbitration ofa number of countries that

are members of the CISG regarding the application of provisions of theConvention on the exemption from ability for the intemational sale of goods.

§.2 The scope of the research

The research analyzes the fundamental issues of liability exemption inintemational goods sales contracts Through examining cases directly related

to this issue, the thesis raises problems with regulations on the exemption ofliability in intemational goods sale contracts that businesses may encounter.From the content and practical application of the provisions of the CISG andVietnamese law on exemption of liability in intemational goods purchase andsale contracts, the thesis provides evaluation opinions and recommendations toimprove enforcement efficiency and enforce the law on liability exemption forbusinesses when participating in intemational goods purchase and sale

contracts.

6 Methodology

This thesis was carried out through the following methods:

Analytical method: Analyze theoretical issues and current legalregulations on liability exemption in intemational goods sales contractsaccording to CISG and Vietnamese law

Comparison method: Compare and contrast the provisions of the CISGand Vietnamese law, as well as compare the actual application process betweencases on liability exemption, to draw out the advantages and limitations of regulations and the effectiveness of applying the law in practice.

Synthetic method: Generalize the theoretical and practical issues of liability exemption in intemational goods sales contracts, providing appropriate recommendations on the above problem.

7 Structure of the thesis

In addition to the table of contents, the introduction, the conclusion, thelist of references, and some accompanying appendices, the content of the thesisconsists of 3 chapters, precisely:

Chapter 1: General theoretical issues of the exemption from liability incontracts for the intemational sale of goods

Chapter 2: Practical application of the regulations on the exemption fromliability in contracts for the intemational sale of goods under CISG and

Vietnamese law.

Chapter 3: Recommendation to complete Vietnamese law on theexemption from liability in contracts for the international sale of goods

CHAPTER 1: GENERAL THEORETICAL ISSUES OFTHE EXEMPTION FROM LIABILITY IN CONTRACTS

FOR THE INTERNATIONAL SALE OF GOODS

1.1 Concept of contracts for the international sale of goods

1.1.1 Definition of contracts for the international sale of goods

In the general development trend of international trade activities, theglobal nature of trade exchanges is being expressed more and more clearly.Transactions in the field of trade in goods, largely through contracts, are takingplace most commonly in intemational trade transactions An intemationalgoods sale contract is a type of contract that is frequently used by subjects ofglobal trade relations in their commercial activities

An intemational contract for the sale of goods is a contract for the sale

of goods of an international nature It has all the characteristics of an assetpurchase contract: There is an agreement between the seller and the buyer toestablish, change, or terminate the purchase and sale relationship, whereby the seller is obliged to transfer ownership of the asset The property is the subject

of the contract for the buyer, and the buyer must receive the goods and pay theseller according to the agreement The Intemational nature distinguishesintemational goods sales contracts from other types of contracts signed indifferent fields of International Trade, such as services, investment, andintellectual property The international nature of an intemational sale of goods contract is understood differently depending on the viewpoint of each country'slaw and intemational law Determining the intemational nature of goods hasvital legal and practical significance because it is associated with determiningthe law goveming the parties’ relationship in the contract.

There are many different views on determining the international nature

of an intemational goods sale contract According to the CISG, theintemationality ofan intemational goods sale contract is determined by the sole

standard of the location of the parties' commercial headquarters Suppose thecontract for the sale of goods is concluded between parties whose places ofbusiness are located in the territories of different countries In that case, ifthesecountries are parties to the convention, or the law of the country participating

in the convention is applicable by the norms of intemational private law, it is

an intemational goods sale contract Article 10 CISG further stipulates that ifone of the parties or all parties has more than one place of business, it isnecessary to pay attention to which place is closely connected with the contract and its performance The contract arises from circumstances the parties knew

in advance and had anticipated before or at the time of signing Still, if theparties still need a commercial headquarters, it is necessary to determine thepermanent residence of the contract

According to Vietnamese law, "intemational purchase and sale of goods"

is stipulated in the Vietnam Commercial Law 2005 as follows: “is carried out

in the forms of export, import, temporary import, re-export, temporary export,re-import, and border-gate transfer" (Clause 1, Article 27) It can be understoodthat the goods that are the subject of the contract must be delivered across theborder of Vietnam or the border of a country (territory), or moving throughexport processing zones or separate customs areas (customs borders) is thecriterion to determine the foreign element of an intemational goods salecontract If goods do not move across borders, the Vietnam Civil Code 2005regulates regulations for contracts with foreign elements Article 663 of the

2005 Vietnam Civil Code states that a goods purchase and sale relationship isconsidered to have a foreign component when (a) At least one of theparticipating parties is a foreign individual or legal entity or (b) Theparticipating parties are all Vietnamese citizens or Vietnamese legal entities butthe establishment, change, implementation or termination of that relationship takes place abroad, or (c) The participating parties are all Vietnamese citizens

or Vietnamese legal entities but the object of that relationship is abroad.

The above analysis leads us to the conclusion: An intemational goodssales contract is an agreement between parties with commercial headquarters

in different countnes where the seller is obliged to deliver goods and transferrights The seller owns the goods to the buyer and receives payment, while thebuyer has the obligation to pay the seller, receive the goods, and take ownership

of the goods as agreed

1.1.2 Characteristic of contracts for the international sale of goods

An intemational contract for the sale of goods has all the charactensticsofa contract for the sale of assets, such as a contract with consent between thetwo parties, compensation, anda bilateral agreement Besides, the intemational nature causes international goods sales contracts to have specific characteristicscompared to domestic ones Specifically:

Firstly, regarding the subject of the contract: An international goods sale contract involves the parties, the seller and the buyer, whose commercialheadquarters are located in different countries

Goods purchase and sale contracts are established between entities,mainly traders According to the provisions of Clause 1, Article 6 of the 2005Commercial Law, "Traders include legally established economic organizations and individuals who conduct commercial activities independently, regularly and have business registration." In addition, organizations and individuals whoare not traders can also become subjects of goods purchase and sale contracts

According to Clause 3, Article 1 of the 2005 Commercial Law, theactivities of a party that is not a trader and does not aim for profit ina goodspurchase and sale relationship must comply with the Commercial Law when the above subject applies the Law.

Secondly, regarding the form of the contract: According to CISG, a contract is a way of expressing the will of agreement between the partiesparticipating in the contractual relationship so that it can be expressed in any

form, such as speech or writing Specific documents or acts of the contractingparties However, according to Vietnamese law, Clause 2, Article 27, andClause 15, Article 3 of the 2005 Vietnam Commercial Law, intemational goodspurchase and sale must be carried out based ona written contract or other value-equivalent legal treatment That helps avoid risks when entering into andimplementing contracts and is clear evidence whena dispute occurs To resolveconflicts with CISG regulations, Vietnam has made reservations on contractforms stated in Articles 11, 29, and Part II of the Convention, by the provisions

of Articles 12 and 96

Thirdly, regarding the language of the contract, the parties choose thelanguage of the contract Foreign languages are often used to sign internationalgoods sales contracts, the majority of which are English, because it isa popularlanguage globally, common, and easily accessible to the parties.

Fourthly, regarding the contract object, goods are the object of the goodssale contract For international goods sale contracts, goods are often movedacross borders.

According to the CISG, goods covered by the Convention are tangiblemovable property, excluding property nghts - goods not within the scope ofArticle 2 of the CISG are the subject of contracts for the sale of goods.According to Vietnamese law, goods are defined in Clause 2, Article 5,Commercial Law 2005, including movable property, including movableproperty formed in the future, and objects attached to land However, only goods allowed to be exported or imported, not on the list of prohibitedcirculation or export are issued together with Decree 12/2006/ND-CP detailingthe implementation of the 2005 Commercial Law And new specialized legaldocuments can become the subject of intemational goods sales contracts

In short, the goods that are the subject of an intemational goods sale contractare tangible movable property and must be on the list of permitted purchases, sales, exports, and imports according to the law of the buyer and seller, not on

the Product groups that are restricted from export or import or must meettechnical requirements on food hygiene and safety conditions.

In addition, regarding payment currency, the currency used for payment

in intemational goods sales contracts is chosen by the parties in the contract.The currency selected for payment can be the currency of one of theparticipating parties, or that of a third country can be used The paymentcurrency can also be gold (now no longer used much), unified communitycurrencies such as the Euro, or national currencies such as Vietnamese dong(VND) or the US dollar (USD), Chinese Yuan Renminbi (CNY) In signing,the parties often want to use their country's currency in the contract to avoiddisadvantages in exchange rates and foreign currency conversion costs

Next, regarding the law governing contracts: The law govemingintemational goods purchase and sale contracts is chosen by the partiesthemselves in the contract Intemational treaties, intemational practices,precedents, national laws , may govern intemational goods sales contracts If the parties do not choose the law governing the agreement, they will Applyintemational private law rules or be selected by competent dispute resolution

agencies.

Finally, regarding dispute resolution agencies, Courts and commercialarbitrators chosen by the parties or implicitly related to intemational goodssales contracts are the agencies to resolve disputes arising from the conclusionand implementation of international goods sales contracts.

1.2 The concept of exemption from liability in international goods sales

contracts

1.2.1 Definition of liability for breach of international goods sale contract

“Responsibility", according to the Vietnamese Dictionary 1 means "the

task assigned or considered assigned, must be fulfilled, and if the results are not good one must bear the consequences.”

Whena contract is breached, the aggrieved party must bear responsibilityfor its breach This is necessary because the violation affected the contract,leading to the violating party not achieving the expectations they should haveachieved in the contract.

The CISG has used the term “remedies for breach of contract" to refer toresponsibilities for breach of contract, including Requesting a reduction in the price of goods (Article 50), Compulsory performance of the contract (Article

46, Article 62), Compensation for damages (Articles 74 - 77), Cancellation ofthe contract (Articles 49, 64), Request for payment of interest on late payments(Article 78)

PICC 2016 also uses “remedies for non-performance" in Article 3.7 torefer to measures applied when the contract is not performed These are the following measures: Temporarily suspend the performance of the contract (7.1.3), Force compensation for damages (7.4.1), Cancel the contract (7.3.1),Request payment of interest on the amount due (7.4.9)

Vietnam Commercial Law 2005 also uses the term "sanctions" to refer

to measures that can be applied when one party violates the contract and arelistedin Article 292 as follows: Forced performance of the agreement, Penaltiesfor violations violation, Force compensation for damage, Temporary suspension of contract performance, Suspension of contract performance,Cancellation of the contract, other measures

Thus, the definition of liability for breach of an intemational goods salecontract can be drawnas follows: "Responsibility for breach ofan internationalgoods sale contract is the adverse Ìegai consequences that the violating partySuffered due to non-performance, incomplete performance or incorrectperformance of obligations specified in the contract."

1.2.2 Definition of exemption from liability in international goods sales

contracts

In terms of terminology, according to the Vietnamese Dictionary },

“exemption” means "Giving without having to suffer, without having to do.”

So, “Responsibility” can be understood as not having to bear any consequences

Legally, “Exemption from Liability" means that the violating party doesnot have to suffer adverse legal consequences due to failure to perform,incomplete performance, or improper performance of the obligations specified

in the contract

Regulations on responsibility for proper contract performance are acrucial aspect of ensuring faimess when entering into contracts However,contracts are only sometimes implemented smoothly There may be unexpectedevents that affect the contract implementation process or obstacles beyond the control of the parties, leading to a party violating the contract even though it is not desired In such cases, regulations on liability exemption come into play,freeing the party violating the contract from sanctions This is not aboutfavoring one party over the other but protecting the legitimate nghts andinterests of all parties involved in the contractual relationship

Exemption from liability for breach of an intemational goods sale contract is a crucial aspect of maintaining contractual relationships It is the exclusion of the fault element ofthe violating party, allowing the violating partynot to be subject to sanctions This concept applies to cases agreed upon by the

2Hoang Phe (1997), Jiefnamese Dictionary, NXB Da Nang, p 631.

parties in the contract or by law When the violating party proves that they havesufficient grounds to be exempt from liability, they will not need to beresponsible for the breach of contract, thus preserving the contractualrelationship.

Thus, it can be concluded: "Exemption from liability in an internationalgoods sale contract is the elimination of adverse legal responsibilities incurred

by the violating party due to failure to per form, incomplete performance or notcomplying with the obligations stipulated in the contract based on the casesprescribed by law or as agreed upon by the parties."

1.2.3 Characteristics of Exemption from Liability in International GoodsSales Contracts

Firstly, the violation must fall into the cases of exemption from liabilityprescribed by law or agreed upon by the parties Suppose the violation doesnot fall into the cases of liability exemption prescribed by law or agreed upon

by the parties in the contract In that case, it will not be considered an act subject

to liability exemption

For example, A German seller and an Italian buyer, both professional cardealers, entered into a contract to sell a used car The seller had purchased the car from another car dealer and had submitted the vehicle registration document

to the police for a preliminary check Although nothing was revealed by thepolice's check, it later tured out that the car had been stolen before its sale Asaresult, the Italian police returned the car to its original owner In the meantime,the buyer resold the car to a third party and had to retum the two chequesreceived as payment for the vehicle The buyer then fileda suit claiming breach

of contract, damages, and lost profits The seller requested the dismissal of the claim, alleging that it had acted in good faith.

The Court of First Instance dismissed the claim, holding that, according

to Art 79(1) CISG (which, under its Art 1(1)(a), was the lawapplicable to the

merits of the dispute), the seller was not liable The seller demonstrated that itsbreach of contract was due to an impediment beyond its control, which couldnot reasonably be expected to have been taken into account at the time of theconclusion of the contract or avoided, or could its consequences be overcome.The buyer appealed.

The Court of Appeal partially reversed the decision of the Court of FirstInstance, finding that the seller had failed to fulfill its obligation, namely thetransfer of ownership of the car to the buyer After pointing out that CISG doesnot govem the effects of the contract on the property in the goods sold (Art.4(b) CISG) and that, as a consequence, this is a matter govemed by domesticlaw, the Court applied German law, which prohibits the acquisition of stolenproperty, even by those who pay value and are in good faith Contrary to whatthe Court of First Instance affirmed, the Court of Appeal held that the sellercould not be exempted from liability under Art 79 CISG, since such anexemption implies the occurrence of objective circumstances preventing thefulfillment of the contractual obligations, while in the case at hand, the allegedcircumstances were subjective Moreover, the argument that the allegedimpediment could not reasonably be expected to have been taken into account

at the time of the conclusion of the contract was not convincing The low price

of the car, the mileage, and the disparities in the owner's name (which wasdifferent from the one on the registration document) should have led the seller

to doubt the ownership of the vehicle

Accordingly, the buyer was held entitled to damages under Arts 45(1)(b)

and 74 CISG, including loss of profit?

Secondly, the burden of proof

Clause 1, Article 7.1.7 PICC 2016 mentions: "The obligated party isexempted from the consequences of its non-performance ifit can prove that thenon-performance is due to an obstacle beyond its control." I " The violating

3 https: //www-unilex infolcisg/case/1342, access on 10/02/2024.

party is responsible for Proving all the conditions to be exempt from liability.Suppose the violating party fails to perform this obligation In that case, it willnot automatically be exempt from liability because there is no basis forapplying an exemption for that violation.

Thirdly, notification obligation

Article 79.4 CISG stipulates, “A party that fails to performits obligationsmust report to the other party about the obstacle and its impact on its ability toperform its obligations If the notice does not reach the other party within areasonable time after the party failing to perform knew or should have known

of the impediment, it will be liable for damages resulting from the other party'sfailure to acknowledge the impediment be informed"

Notifying the other party of the impediment to the contract is mandatoryfor the breaching party This notification allows the other party of the contract

to grasp the situation, whether this violation is temporary or permanent, the consequences that come with it, and whether it can be handled or not, and leads

to the decision to cancel the contract Contract or continue to maintain thecontract Such notice must also be given within a reasonable time after thedefaulting party writes or should have written about the impediment Supposethe violating party does not fulfill this notification obligation, even if the

"impediment" conditions under Article 79.1 CISG are met In that case, theviolating party will still be legally responsible for the consequences resultingfrom the act violated.

Finally, legal consequences

In case the violating party fully meets the "impediment" conditions,completes the burden of proof, and notifies the other party of the violation, theywill not be subject to sanctions due to the violation Caused by the offense

Specifically, the responsibilities that can be waived will depend on the provisions of law the parties agree to apply to the contract, or the parties themselves agree to it In addition to exemption from liability, the parties can

agree on other measures to continue the contract, such as extending the time forperforming contractual obligations, renegotiating the contract terms, andcanceling the contract ifit is impossible Continues and the violating party may

be subject to other responsibilities besides the exempted liability

1.3 Sources of law governing the issue of liability exemption ininternational goods sales contracts

1.3.1 International treaties

International treaties are the primary source of law regulating intemational trade issues in general and international goods sales in particular.Under the provisions of Clause 1, Article 2 of the 2016 Law on InternationalTreaties, it stipulates the concept of a specific intemational treaty: “Anintemational treaty is a written agreement signed on behalf of the State orGovernment." the Socialist Republic of Vietnam with a foreign contractingparty, giving rise to, changing or terminating the rights and obligations of theSocialist Republic of Vietnam under intemational law, regardless of the namecalled treaties, conventions, agreements, conventions, agreements, protocols,memoranda of understanding, exchanged notes or documents with othernames." Several intemational treaties govern the international sale of goods,such as the 1980 Rome Convention on the Law Applicable to ContractualObligations and the 1974 New York Convention on Time Limits in the Sale ofGoods Intemationalization

However, the exemption from liability in intemational goods salescontracts is currently only regulated by the CISG The CISG (Convention onContracts for the Intemational Sale of Goods) was drafted by the UnitedNations Commission on Intemational Trade Law (UNCITRAL) ThisConvention was created to unify the law applicable to intemational salescontracts for all countries while promoting the elimination of legal obstacles inintemational trade It will support the development of intemational trade

CISG is mentioned in many intemational trade disputes as the lawgoveming the content of intemational goods sales contracts signed betweenmerchants This Convention was adopted in Vienna (Austria) on Apnl 11,

1980, at the United Nations Committee on Intemational Trade Law Conferencewith representatives ofabout 60 countries and eight intemational organizations.Intemational The CISG took effect on January 1, 1988 (when ten countries

ratified it, according to Article 99 of the Convention) * Since then, CISG has continued to witness the participation of 97 countries worldwide* as members

of the Convention, creating a solid position for CISG in the intemationalcommercial legal system and as a source of law It is essential for resolvingcontractual disputes.

The 1980 Vienna Convention includes 101 Articles, divided into fourparts with the following principal contents: Part 1: Scope of application andgeneral provisions (Articles 1-13), Part 2: Establishment of contracts (order,Contract signing procedures) (Articles 14-24), Part 3: Purchase and sale ofgoods (Articles 25 - 88), Part 4: Final regulations (Articles 89 - 101) Immunityfrom liability is provided in Articles 79, 80, section IV, part 3 of theConvention

1.3.2 National law

National law is the source of law chosen to apply when there is nointemational treaty or an international treaty that does not mention or does notentirely mention relevant issues in international goods sale contracts , or asagreed upon by the parties in the contract National law is a system of legalnorms, written or unwntten, established or recognized by the State to regulate

* https://trung tamwto vn/chuyen-de/1 147-so-luoc-lich-su-cong-uoc-vien-1980-cisg, access

on 15/02/2024.

legal relations between subjects of law, and in principle, those relationsdevelop I was bom within the temitory or jurisdiction of that State.

Each country's law has its regulations on intemational goods salescontracts Applying one country's law also means applying foreign law to theremaining subjects in the contract.

Vietnam's national law directly regulates liability exemption inintemational goods sale contracts in the 2005 Vietnam Commercial Law inArticles 294, 295, 296, and general provisions in the Vietnamese Civil Code2015

1.3.3 Other sources of law

PICC set of principles for international conanercial contracts

PICC (Principles of International Commercial Contracts), drafted andissued by the Institute for the Unification of Intemational Law (UNIDROIT) in

1994, amended and supplemented in 2004, is a document that collects basiclegal principles reflecting the concept that has been recognized in most legalsystems around the world Therefore, these legal principles are the basis forcontractual subjects from different legal systems worldwide to agree on, sign,and implement commercial contracts quickly, such as international trade.

According to the continuous development of intemational trade, PICC has gone through many different versions, such as PICC 2004, PICC 2010, andPICC 2016 PICC is applied when the contracting parties agree that PICC willgovern their contract, they agree that it will be govemed by “fundamentalprinciples of law,” “lex mercatoria,” or similar principles, or the parties do notchoose a specific law to govem the contract

PICC 2016 (Latest version to date) includes 11 chapters and 210 articles,

of which Exemption from Liability in Intemational Goods Sales Contracts areincluded in the provisions of Chapter 7 PICC, principles governing the non-

performance implementation of the contract, specifically in Clauses: 7.1.6(Exemption clause) and 7.1.7 (Force majeure).

International precedent

Precedent law is the arguments and rulings in the dispute resolutionagency's legally effective judgment or decision on a specific case and is used

as a basis to apply to cases with similar circumstances later on.

Case law is essential in resolving disputes about international goods salecontracts The following cases of a similar nature can apply case law forreference or even to make a judgment with the same value as the provisions inany other existing legal documents

As of February 28, 2024, after searching the case law system posted atUnilex, 52 case laws were found to be related to exemption from liability inintemational goods sale contracts, including 38 related case laws to article 79

and 14 case laws about article 80 CISG 6

1.4 Meaning

The issue of exemption from liability due to violation of goods purchase and sale contracts is intemal

Legal content is essential because it directly affects nghts and obligations

of the parties to the contract, as well as having important significance inlitigation activities after that.

Regulations on liability exemption help parties knowhow to behave when encountering cases related to liability exemption in implementing intemational goods sale and purchase contracts From the provisions of law, the parties willhave a basis to determine the case of exemption from liability, the followingsteps, such as the burden of proof, and the obligation to notify to handlepromptly to minimize damage to the contract.

Regulations on liability exemption are intended to divide risks in thecontract Because international goods trading is influenced by many differentfactors such as geography, climate, culture, law, etc., this is a complexcommercial transaction that not only depends on the party Seller and buyer.Objective extemal impacts such as intervention by national govemments,natural disasters, epidemics, and wars , cause the parties to be unable toproperly and fully perform their contractual obligations In such cases, no onewants to affect the contract, so the parties to the agreement will need to sharerisks and release the violating party from sanctions resulting from the violation.

Be exempted from such liability

This is also the basis for ensuring the rights and interests of the parties

In the practice of international goods trading, there are cases where violationsare due to subjective reasons, but the violating party intentionally abusesunclear regulations to claim that they are exempt from liability And avoidresponsibility for compensating damages to the other party Regulations onliability exemption are necessary tools to eliminate cases of contractperformance evasion

Waiver of liability is the basis for minimizing disputes ansing from thecontract and maintaining a good long-term business relationship between theparties When there are specific regulations on liability exemption according tothe law or the parties themselves, agree in the contract, unfair cases will be avoided when the violating party did not intentionally cause the violation but still has to bear the consequences Related sanctions This will first lead to disputes between the parties and then may break the business associationbetween the parties in the future because of the negative impact of the violationthat has occurred.

CONCLUSION OF CHAPTER 1

Chapter I of the thesis overviewed general theoretical issues on liabilityexemption in intemational goods sale contracts Based on the concept of intemational goods sales contracts, we analyze the idea, the source of goveminglaw, and the meaning of stipulating the issue of liability exemption inintemational goods sales contracts The thesis outlines the concept of liabilityexemption in international goods sales contracts based on provisions fromCISG, PICC 2016, and Vietnam Commercial Law 2005 From there, leamabout the characteristics of liability exemption in international goods sales contracts that the parties must pay attention to when applying the relevant regulations Research the legal sources goveming the issue of liabilityexemption in intemational goods sales contracts to analyze the relationshipapplicability and support of these legal sources with each other On that basis,the practical implications of the regulations on liability exemption inintemational goods sale contracts will be drawn

CHAPTER 2: PRACTICAL APPLICATION OF REGULATIONS

ON THE EXEMPTION FROM LIABILITY IN CONTRACTS

FOR THE INTERNATIONAL SALE OF GOODS

UNDER CISG AND VIETNAMESE LAW

CISG and Vietnamese law both have regulations on the exemption from liability in intemational goods sales contracts In the division of liabilityexemption cases, these regulations generally have certain similarities and manydistinct points There are 2 cases of liability exemption stipulated by both theCISG and Vietnamese law Exemption from liability due to obstacles encountered by the violating party and Exemption from liability due to the fault

of the violating party One case of Exemption from liability is only stipulated

in the CISG: Exemption from liability due to matters with a third party related

to a party to the contract Two cases of Exemption from liability are onlystipulated in Vietnamese law Exemption from liability as agreed upon by theparties in the contract and Exemption from liability due to the implementation

of decisions of competent state management agencies The following will analyze the cases of Exemption from liability in intemational goods sales contracts stipulated in CISG and Vietnamese law, specifically CISG andVietnamese law

2.1 Regulations on the exemption from liability in contracts for theinternational sale of goods under CISG and Vietnamese law

2.1.1 Exemption from liability due to obstacles encountered by the violating

party

Exemption from liability due to the violating party encountering obstacles according to CISG regulations

Legal basis

According to the CISG, the violating party will be exempted from liabilitywhen encountering “obstacles” as prescribed in Clauses 1, 3, 4, and 5, Article

79 of the Convention

Definition of "obstacle"

Article 79.1 CISG stipulates: “4 party is not liable for failure to performany ofits obligations if it proves that such failure is due to an obstacie beyondits control and one cannot reasonably expect to take account of that impediment

at the time of conciuding the contract or to avoid or overcome itsconsequences.”

Burden of proof

A party may invoke the grounds for exemption from liability specified

in Article 79.1 CISG if four conditions are simultaneously satisfied’: i) There

is an obstacle beyond its control and not dependent on its will that prevents aparty from performing a specific contractual obligation; ii) At the time ofentering into the contract, during the process of implementing the contract, the aggrieved party was not aware of and could not predict the obstacles that mayarise; iii) Obstacles cannot be avoided and the consequences cannot beovercome when they occur, iv) The violating party must fulfill the notificationobligation.

i) There is an obstacle beyond its control and not dependent on its willthat prevents a party from performing a specific contractual obligation

First, we must pay attention to the term “obstacle.” CISG does not provide a concept or list specific cases that are considered obstacles but onlynotes that this isa case in which the violating party is exempted from liability.Considering the similarity of terminology, it can be seen that several otherterms are pretty popular and used to refer to this case, such as "force majeure,”

“hardship,” changed circumstances, “impracticability," or “impossibility.”

Using the term "obstacle" in this case can have a broader meaning than theterms mentioned above, however, because there is no specific explanation,accepting what an obstacle is depends on interpreting the dispute resolutionbody and the national legal system.

Extemal obstacles that objectively interfere vith contract performancecan come from nature or humans, but all make contract performanceimpossible If they are natural phenomena, they must be phenomena thathumans cannot predict, such as tsunamis, earthquakes, volcanoes, etc As forpredictable phenomena such as seasonal weather, the party's contractperformance needs to be proactively controlled so as not to affect contractperformance and not be considered an obstacle However, human-causedobstacles such as war, epidemics, legal obstacles such as bans or restrictions ontransportation, payment, etc that objectively affect the contract are alsoconsidered is an obstacle, and their impact can be significant

We can refer to the following case: The dispute occurred between aFrench company (seller) and a Dutch company (buyer) The seller and buyersign a contract to buy and sell steel pipes, which has no provisions for priceadjustment After signing the contract and before delivery, the steel pricesuddenly increased by 70% The seller tried to negotiate a higher selling price,but the buyer refused and requested to deliver the goods at the agreed sellingprice according to the signed contract The seller did not provide the goods, so the buyer brought an action before the competent B elgian Court The applicable law to resolve disputes in the above-mentioned intemational goods salescontract is the 1980 United Nations Vienna Convention

Ruling of the Court of First Instance on January 25, 2005: The Court ofFirst Instance held that the buyer was in a situation where the “doctrine ofunpredictable circumstances" applied However, the Court found that the CISGdoes not govem the circumstances posed by this doctrine, therefore refusing to use the review of the contract's selling price based on the said doctrine.

The ruling of the Court of Appeal:

Preliminary ruling dated June 29, 2006: The Court of Appealsrecognized that the buyer was in the situation of the “doctrine of unforeseeablecircumstances"; thus, the Court of First Instance refused to reconsider the priceSelling because the CISG does not regulate this issue is incorrect In addition,the Court of Appeal also said that the Court of First Instance refused to applythe review of the selling price without understanding the applicable law based

on the mules of intemational private law and whether that applicable lawexcluded reconsidering the selling price.

Final judgment dated February 15, 2007: The Court affirmed that CISGhas no regulations related to price adjustment in unusual and unpredictablecases However, price adjustment does not violate the rules CISG principles.The Court determined that the applicable law is French law based on Article Y

of the CISG, thereby allowing the parties to renegotiate the contract based onthe principle of good faith The seller's refusal to deliver the goods if the sellingprice is not adjusted correctly does not violate the agreement Still, the buyerhimself violates the principle of good faith when refusing to renegotiate theselling price.

Ruling of the Supreme Court on June 19, 2009: The Court rejected theapplication of French domestic law The Court commented: The Court ofAppeals incorrectly applied Article 7 of the CISG, accordingly wheninterpreting the CISG, it is necessary to ensure uniformity in the application ofthe Convention and respect for good faith in intemational trade , relevantmatters not regulated in the Convention shall be resolved by the generalprinciples on which the Convention is established; in the absence of theappropriate tenets, they shall be resolved by applicable law and determinedaccording to the principles of intemational law From the above provisions, theCourt believes that it is only necessary to apply general principles governing intemational commercial law in this matter The Court referred to the

UNIDROIT Principles of Intemational Commercial Contracts The Court alsointerpreted this case as an impediment that allows a party to a contract to be exempted from liability and unable to perform its obligations under Clause 1,Article 79 of the CISG The Court determined that the increase in steel priceswas an unforeseeable event, a change in circumstances in which continuing toperform the contract under current conditions would cause severe damage tothe seller The Court ruled that the parties must renegotiate the contract in goodfaith.

Therefore, the lesson leamed is that the parties to the contract, especiallythe seller, should consider negotiating a clause that allows adjusting thecontract's selling price in case of sudden, unpredictable fluctuations B efore themarket, specific criteria and mechanisms must be stipulated to determineselling price adjustments.

In general, the impediment must be an influence the violating partycannot control The obstacle must have no connection with the violating party,

be not due to the violating party's fault, and be outside the scope ofresponsibility that the violating party must consider

ii) At the time of entering into the contract, during the process ofimplementing the contract the aggrieved party was not aware ofand could notpredict the obstacies that may arise

This condition, which considers the unpredictability of the situation, isapractical approach to contract law It requires a situation that cannot be calculated, occurs unexpectedly, and is not repeated to be considered anobstacle For example, a party to a contract who cannot perform the contractdue to a flood occurring in an area that regularly experiences floods everyAugust will not be exempt from liability under Article 79 CISG However, ifaflood suddenly occurs in January, a time when such events are rare, it will be

an obstacle that could not have been foreseen at the time of entering into the

contract.

To clarify the above issue, we can consider a case law as follows: theevent ofa frozen port isa natural event that hinders the transportation of goods

by the obligorin the contract Raw Matenals Inc lawsuit (RMI - buyer - UnitedStates) with Manfred Forbeserich GmbH & Co KG (Forberich - seller -Germany) settled in the United States Federal District Court On February 7,

2002, RMI signed a written contract with Forbes, whereby Forbes agreed tosupply RMI with 15,000 - 18,000 MT of used Russian railway tracks Goodsare shipped from St Petersburg, Russia, before June 30, 2002 The parties agreethat CISG is the law goveming the contract In June 2002, the parties agreedthat Forbes would extend the contract performance period to the “last day ofthe calendar year" without specifying a specific date Hence, the partiesimplicitly understood that Forbes would be delivered before December 31,

2002 However, by the end of this deadline, Forbeserich still needed to deliverthe goods due to a freezing snowstorm that caused the port of St Petersburg'sfreeze on December 1, 2002, hindered deliveries The buyer sued the Court ofFirst Instance regarding the seller violating the contract terms The sellersuccessfully defended himself on the grounds of encumbrance and was relieved

of liability The buyer wanted more from the results of the first instance trial,

so he appealed the Court's decision

According to the seller's argument, the freezing of the port, in this case,was an “abnormal weather phenomenon." The seller quoted the testimony of

Mr Nikolaev, an employee of St Petersburg, that the port froze on December

1, 2002, a phenomenon that had not happened since 1955, and no one couldhave predicted the port freezing so early On the contrary, the buyer said, "Thatphenomenon is not surprising to any experienced businessman (as well as anystudent of geography)." Furthermore, according to buyers, it takes 3-4 weeksfora ship to transport goods from the port of St Petersburg to the United States,

so the seller should have shipped the goods before the port froze so that theshipment could arrive before the December 31, 2002 deadline However, there

is no evidence to establish whether the seller was obliged to deliver the goods

to the United States before December 31, 2002, or was only required to loadthe goods on board the vessel before December 31, 2002 If only the loading ofgoods on the ship is needed, a frozen port may prevent the seller from fulfillinghis obligations.

According to the Court's ruling, the seller will be exempt from liabilitydue to obstacles As the seller stated, the cargo ship left the port on November

20, 2002, and was expected to take 3-4 weeks to reach the US port, but thewinter of 2002 was the coldest in 60 years of history Return of ST Petersburg,

so much so that the icebreaker got stuck in the ice, thereby preventing thedelivery of goods to buyers from late November onwards Experts working atthis port also assessed that the port had been frozen since December 1, 2002,and that such an early freeze had not happened since 1955 The Court alsofound that the severity of the winter of 2002 and the freezing phenomenon andits consequences are not ordinary natural phenomena Usually, the port of 5t Petersburg will also freeze, a natural phenomenon that occurs every year, butthis event usually only happens at the end of January

Thus, this is an "objective" and "unforeseeable" event that prevents theviolating party from performing its contractual obligations The frozen portevent, in this case, is an obstacle so that the seller will be exempt from liabilitydue to breach of contract, the Court rejected the buyer's appeal

From the above case, it can be seen that an event to be considered an obstacle must first be an objective event beyond the control of the violatingparty and unforeseeable at the time of signing the contract The event ofafrozen port is a natural, objective weather phenomenon; unusual, no oneexpected (coldest in history in the past 60 years; it has never frozen this earlysince 1955)

Because no Court in the United States has yet interpreted or applied Article 79 of the CISG, the Court cited case law applying UCC provisions on

related issues due to similarities with Article 79 CISG Accordingly, the Courtused case law to apply Article 2-615 UCC, stipulating three conditions forexemption from liability: (1) A fortuitous event suddenly occurs, (2) Due tothis unexpected incident, the performance of contractual obligations cannottake place; (3) The contract is concluded on the assumption that this unexpectedevent does not occur However, regulations like the UCC are more relaxed thanthose of the CISG According to the CISG, there must also be a condition thatthe violating party “cannot overcome the consequences caused by the obstacle."

In this case, due to the application of UCC case law, the Court does not requirethe seller to prove what they have done to overcome the consequences caused

by the force majeure event or whether they have tried to find other ways to do

so Fulfill contractual obligations (for example, consider whether it is possible

to find an alternative port)

Besides, the extension of the contract performance term by the parties isnot straightforward: the parties agreed orally, so there is no exact evidence to prove that the parties have extended it; No specific delivery time specified; doesnot specify which port of delivery in the United States; It is also not clearwhether the extended time limit applies to the arrival of the goods at the buyer'sport or to the loading of goods onto the ship at the seller's port Therefore, theconsequence is that the buyer - the aggrieved party The offender was at adisadvantage concerning his arguments.

iti) Obstacles cannot be avoided and the consequences cannot be overcome when they occur.

In cases where the impediment was not foreseeable at the time of thecontract's conclusion but could have been foreseen or afterward, if thebreaching party did not take any measures to try to prevent or overcome the impediment to reduce the impediment and minimize its impact on the contract'sperformance, it will not be exempt from liability under Article 79 CISG

As in the dispute between RMI and Forbeserich mentioned above,although the seller was not forced to prove his ability to overcome the consequences, the seller tried to overcome the problem by hiring an icebreaker

to guide the ship Deliver goods to escape the frozen sea However, this actionwas ineffective because the ice was so thick and complex that the icebreakergot stuck in the ice.

Notification obligation

In addition to proving the conditions of “impediment” under Article 79.1CISG, the violating party must fulfill the notification obligation under Article79.4 CISG: "Any party that fails to perform its obligations must report to theother party." about the impediment and its effect on the ability to fulfillobligations Suppose the notice does not reach the other party within areasonable time after the party fails to perform and knew or should have known

of the impediment In that case, it will be liable for damages resulting from theother party's failure to acknowledge the impediment be informed"

The violating party is required to notify the other party of the obstaclesituation, such as what the obstacle is, how to solve it, and whether it can beovercome or not so that they can Decide whether to continue the contract,cancel the contract, or take measures to resolve the consequences of thecontract The notice must also be completed within a reasonable time after thedefaulting party knew or should have known of the impediment If thenotification obligation is not fulfilled, the violating party will not be exempt from liability under Article 79 CISG.

To clarify the obstacle further, we can refer to the following case

Ina significant commercial relationship, a Spanish seller and a Belgianbuyer were in dispute over the supply of pine kemels The seller's claim ofreduced supply due to a conifer blight and partner issues led to a disagreement, highlighting the importance of contract terms and unforeseen circumstances in commercial agreements

The Court of First Instance found for the seller, which based its defense

on Art 79 CISG The buyer appealed

The Appellate Court's decision to overtum the first instance ruling wasbased ona clear interpretation of Art 79 CISG It rejected the seller's argument,stating that the issue with the cooperatives was within the seller's control andnot a circumstance that could excuse non-performance under the CISG

Considering the high volatility in the pine keel market, the Court alsoconcluded that a reduction in production was not an event that could not be expected or avoided and that, for sucha reason, the seller might have protecteditself from that risk by introducing into the contract terms as to delivery andprice reflects the pine kemels' market features

Furthermore, the Court concluded that the seller had fulfilled itsobligations under the contract because it had declared itself willing to deliverthe missing quantity of the goods if the seller had consented to a priceadjustment Nor could the seller succeed in claiming that its failure to performwas due to the buyer's refusal to renegotiate the price, as this latter was under

no obligation to accept a price other than that contractually stipulated

From the above case law, not all problematic situations are consideredobstacles If the event is foreseeable or still within control and can be handled

by the violating party, there is not enough ground to be exempt from liabilityunder Article 79 CISG

Effect of disclaimer

The effect of liability exemption in this case is only temporary Clause

3, Article 79 of the CISG stipulates that the exemption from liability specified

in this Article is only valid when the impediment exists Thus, when the aboveconditions are met, the violating party will only be exempt from liability whenthe obstacle occurs When the impediment ends, the breaching party mustcontinue to perform the contract and is subject to commercial sanctions if the breach of contract continues.

Legal consequences when the violating party is exempted from liabilityAccording to CISG regulations, the violating party will only be exemptfrom liability for compensation for damages caused by the obstacle UnderClause 5, Article 7926, the violated party still has the night to apply othersanctions according to the provisions of the Convention, such as: Requesting areduction in the price of goods (Article 50), forcing the performance of thecontract (Article 46, Article 62), declaration of contract cancellation (Articles

49, 64) and payment of interest on late payments (Article 78) Thus, after theliability exemption occurs, the violating party can still request the violatingparty to continue performing the contract through sanctions to enforce theagreement Or request the violating party to compensate, such as requesting areduction in the price of goods (the violating party is the buyer) or payment ofinterest on late payments (the violating party is the seller).

When the duration of the obstacle is too long, the consequences caused

by it are too great, or simply the violated party no longer wants to continue the contract, the violated party can declare the cancellation of the contractaccording to Article 49 (the aggrieved party is the buyer) or Article 64 (theaggrieved party is the seller)

Exemption from liability due to the violating party experiencing aforce majeure event according to the provisions of Vietnamese law

Legal basis

Also, taking this stance on liability exemption, Vietnam uses the term

“force majeure." According to Vietnamese law, if this is the case, the violatingparty will be exempt from liability as prescribed in Point b, Clause 1, Clause 2,Article 294, Article 295, and Article 296 of the 2005 Commercial Law

Definition of "force majeure event"

Pursuant to Clause 1, Article 156 of the 2015 Vietnam Civil Code, aforce majeure event is "an objective occurrence that is unpredictable and