It is not difficult to study the Convention on Contract for the International Sale of Goods

27/12/2016 08:12

Discussing with the correspondent of the Customs Newspaper, Mr. Phan Trong Dat,  the Deputy Secretary General of the Vietnam International Arbitration Centre said that in the context of strong international economic integration, if enterprises do not want to lose out on international sales contract disputes, they should study the United Nation‘s Convention on Contract for the International  Sale of Goods (CISG) and this study is not complicated and difficult.

it is not difficult to study the convention on contract for the international sale of goods

How do you assess the role of understanding the CISG for Vietnam’s enterprises?

In the fact the international sale contract’s disputes in the Vietnam International Arbitration Centre show that 60% of disputes are related to the International Sale of Goods. Vietnam’s partners have disputes with 60 different countries. There have been 85 countries join CISG. Hence, the detailed study of CISG prior to and during disputes in an international sale contract, is very important.

Many regions and countries apply CISG, such as in ASEAN, now Vietnam and Singapore joined CISG. Therefore, when the 2 parties sign the sale contract, they need to apply CISG. If the Vietnam enterprises sign the sale contract with the other country in ASEAN but is not Singapore, when the disputes occur, if the 2 sides also agreed on the legal framework to apply in advance and the Arbitration Council decide to apply the Vietnam’s Law and that time, the CISG will be automatically applied.

How are the attention as well as the knowledge of Vietnam’s enterprises on the legal issues in general and CISG in particular, Sir?

With more than 90% of the small and medium size enterprises, and currently most Vietnam enterprises are more interested in the trade issue and less interested in the legal issues in general, Vietnam Commercial Law or CISG and other legal issues

At the Arbitration Central, many small and medium size enterprises and especially the top enterprises when disputes occurr and the sale contract was analyzed, it showed many loopholes in the contract’s provisions. Even though, there were many problems and contradictions in the sale contract. The enterprises get the experience from the disputes to correct them, but in fact that “It is too late to lock the stable when the horse has bolted”. Those mistakes and losses do not affect large enterprises but cause serious consequences for small and medium size enterprises

In your opinion, are the understandings and the application of CISG complicated or difficult for enterprises?

Basically, CISG is not much different from the regulations under Vietnam’s Commercial Law. The prominent different is that Vietnam’s Law on the sale of goods mainly regulates on the sales contract in the domestic area, but CISG regulates the international sale of goods. Hence, in my opinion the understanding and application of CISG is not difficult for enterprises. The contents which are regulated in CISG are very easy to understand. There is a lot of case law on this issue. The enterprises’s duty is to actively study the different methods. If the enterprise understands the Vietnam Commercial Law and applied the same provisions, then further understanding on CISG is very easy because of the high consistency between them and nearly have the difference.

Could you tell me about the case in which the enterprise did not pay attention to study CISG, when disputes occurred, how will they have to suffer the loss?

In the fact, if the enterprises do not pay attention to the law, it is no problem. Because, the sales contract which is signed by the parties will shows the agreements among them. If the sales contract has loopholes and mistakes but the parties still agree to implement and the dispute does not occur, there is no problem. The key issue is that the enterprise must enhance their sense to prevent the risk and resolve the disputes when they arise.

it is not difficult to study the convention on contract for the international sale of goods

The enterprises of manufacturing and exporting wood even though have not known about the CISG

Clearly, when disputes arise and the party which has the lesser understanding of the law will suffer the loss, foremost is money. For example, in the case of the Vietnam enterprise which is the claimant having a full understanding of the law, so the ability of winning in the legal suit is higher. In contrast, in the case where the Vietnam enterprise is the defendant who has a full of understanding of the law, it will help the enterprise limit the loss in the legal suit.

In the next time, how will the VIAC have the aim to support enterprises in studying and applying the CISG?

Currently, the State Management Authorities are planning to support enterprises in studying and applying the CISG. In the last time, when Vietnam is not a member of CISG, the VIAC resolved disputes which are applied under CISG. By January 1, 2017, Vietnam will officially apply the CISG, expecting that the cases of resolving disputes which are applied under CISG will increase. With many umpires who are the experts in the field of the internal trade and have deep knowledge of the law and get experience from other enterprises. In the next time, the VIAC will actively build the essential training for enterprises and organize training on the CISG and I hope that enterprises will interest and participate.

Thank you!


By Nguyen Thanh/Ngoc Loan

Share Post
  • VIAC encourages alternative dispute resolutions 14/06/2017 16:49

    The conference, named ‘Benefits and Challenges of Using ADR for Banking Disputes’, focused on the principles, conditions and procedures of commercial mediation as an ADR method, as well as the conditions for establishment of mediation centres in Viet Nam and the implementation of Decree 22 on commercial mediation, which has been in effect since April 15, 2017.

  • VIAC and International Court of Arbitration ICC co-operates in Better Dispute Resolution, Better International Business 22/05/2017 17:22

    On May 18 2017, Vietnam International Arbitration Centre co-operated with International Court of Arbitration to organize the “Better Dispute Resolution, Better International Business” Seminar. This seminar has attracted different representative from various business sectors, lawyers together with media and presses.

  • VIAC to attend 51 years anniversary of Korean Commercial Arbitration Board 31/03/2017 11:21

    On 22 March 2017, Mr. Phan Trọng Đạt – Deputy Secretary General of Vietnam International Arbitration Centre (VIAC) has paid a visit to Korea, where he attended the International Arbitration Conference and the 51st anniversary of Korean Commercial Arbitration Board (KCAB).

  • VIAC Rules of Arbitration 2017 - The Highlight 18/03/2017 11:02

    On February 3, 2017, Viet Nam International Arbitration Centre (VIAC) has released the Rules of Arbitration – 2017 edition (the Rules 2017). This is the new Rules of Arbitration which shall enter into force as from March 1, 2017 and replace the previous edition of 2012.

  • The new VIAC Rules of Arbitration 2017 14/03/2017 09:03

    “VIAC 2017 Rules of Arbitral Proceedings are the first arbitration code of Vietnam introduced to meet legislative changes stated in Resolution 01/2014/ HDTP/TANDTC dated March 22, 2014 on inclusion of legal relations in general settlement of a dispute.”

  • Vietnam: Official Release of the VIAC Rules 2017 14/03/2017 09:00

    On 3 February 2017, the Vietnam International Arbitration Centre (VIAC) officially released the new 2017 VIAC Arbitration Rules (VIAC Rules 2017), which is scheduled to come into effect on 1 March 2017. Compared to the current Rules of Arbitration of VIAC which has been in force from 1 January 2012, the VIAC Rules 2017 aim at ironing out concerns during the arbitration procedures while further adapting to the international norms in order to better promote arbitration as a alternative dispute resolution mechanism in Vietnam.

  • The Annoucement for Official Release of VIAC Rules of Arbitration 2017 24/02/2017 15:21

    The Announcement took place with the presence of over 100 participants coming from the Government, Business associations, big law firms and leading enterprises in Vietnam and attracted the huge interests of media. The Announcement was to introduce new contents of the VIAC Rules of Arbitration 2017 (“VIAC Rules 2017”), provided the audiences with useful information related to the dispute resolution mechanism of commercial arbitration in Vietnam in general and at VIAC in particular. 

  • Series of Vietnamese exporters fall prey to Canadian scammer company 17/01/2017 15:14

    The Vietnamese Association of Seafood Exporters and Producers (VASEP) claimed several Vietnamese seafood exporters have been cheated out of hundreds of thousands of dollars in their transactions with Echopack Inc. based in Quebec, Canada. a