UPDATE: Vietnam Legal Research

 

By Anh Luu

 

Anh Luu received her Bachelor of Law in 2001 from Hanoi Law University, Vietnam. She worked for several international law firms in Vietnam before she joined NYU School of Law as a Hauser Scholar in 2005.  Anh Luu obtained an LL.M. in Corporation Law from NYU School of Law in 2006. She has been a member of the Hanoi Bar Association since 2004 and qualified in New York in 2007.  Anh Luu is working as a Corporate Lawyer at Macfarlanes Solicitors in London.

 

Published May/June 2008

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Table of Contents

Introduction

The Communist Party of Vietnam

National Assembly

Administration

Judicial System

Alternative Dispute Resolution

Legal profession

Research Resources

 

Introduction

The Socialist Republic of Vietnam has a population of more than 84 million[i] on an area of 331.690 square kilometres in Southeast Asia.[ii]

 

The Vietnamese originated from several tribes and factions since 2000 BC in the northern mountainous area of modern Viet Nam. The country was under Chinese occupation for more than ten centuries until 938 AD. Since then, Vietnam remained independent until the late 19th century. In 1859, Vietnam fell under French colonization and then occupied by Japan during World War II.[iii]

 

The country declared its independence on September 2, 1945 under the name Democratic Republic of Vietnam. The country carried out the war against the French until 1954 when French forces were defeated in the famous Dien Bien Phu campaign. The Geneva Accord 1954 temporarily divided the country into two parts along the 17^th parallel: the Democratic Republic of Vietnam in the north and the Republic of Viet Nam in the south. After twenty one more years of war between the north (supported by the communist countries) and the south, with deep military involvement of the U.S. Government including its widespread bombing of the north, in 1975 the north took over. The country was fully reunited and later renamed the Socialist Republic of Vietnam.[iv]

 

The country carried out economic reform, popularly known as doi moi, since 1986, under which the country diverted from the central planning economy to the market economy.

 

The centre of doi moi was the provision of rural land to the farmer families, liberalization of internal and external trade, recognition of individual property, and permission of foreign investment.[v] Doi moi dramatically changed Vietnam's economy and significantly improved the living standard of its people. Poverty rate dropped from 58% in 1993 to 37% in 1998 and 29% in 2002.[vi] From a rice importer, Vietnam has become the world's second largest rice exporter.

 

Even though Vietnam has been widely praised as a success story of reform, there are concerns about modest foreign direct investment inflows compared to other countries like China, poor rating on corruption and inefficient investment allocation.[vii]

 

The shift from a central planning economy where the State made every decision on the allocation of resources to market economy makes law indispensable. As a result, Vietnamese legislation development coincided with the development of the country's market economy and most of the legal documents applicable today were promulgated in the early 90s and later. Its legal system is still evolving rapidly and therefore fascinating to observe. However, this also raises concerns over its stability and predictability.

 

The country's adhesion to the World Trade Organisation on 11 January 2007 also puts the country under more pressure for transparency and legal reform.

The Communist Party of Vietnam

Even though the Communist Party of Vietnam is a political organization and not part of the State's institutional system, it is essential to be discussed because of its critical role and deep involvement in the political and legal life of Vietnam.

 

Vietnam is a one-party-state under the control of the Communist Party of Vietnam. Since the Constitution 1980, the Communist Party of Vietnam has been stated to be "the force leading the State and the society." Just as the wording, the Communist Party of Vietnam has a central role in shaping the country's policy and legal system and maintains a firm control over all the government and social system.[viii] Its structure is parallel to the government's structure and has close relation to the government.[ix] Its influence is reflected through the formation and election of the National Assembly, the operation of the administration, and the function of the judicial system. Article 41 of the Charter of the Communist Party of Vietnam states that "the Party leads the State by its political statements, its strategy, policy and direction, by ideological activities, and through organisation and staff management by supervision and inspection of performance." It introduces people for election or appointment to State official positions and the majority of high-ranking State officials are Party members. The Party also maintains its influence at all levels of the society through its affiliated organizations: Vietnam Fatherland Front, Ho Chi Minh Communist Youth  Union, Ho Chi Minh Young Volunteer Organization, Vietnam Woman Association, Vietnam Farmer Association just to name a few.

 

The highest authority of the Communist Party of Vietnam is its National Congress which meets once every 5 years. The most important overall policy of the Party, and thus the significant changes in the economic and social policy of the country, is set out in its Resolutions. The standing and more influential bodies of the Party are however its Central Committee and the Politburo. 

 

The economic reform, doi moi¸ originates from the Resolution of the VI^th National Congress in 1986 which recognized for the first time the "multi-sectoral economy." This gave way to the new Constitution 1992 which stated that Vietnam would develop a "multi-component commodity economy functioning in accordance with market mechanisms under the management of the State and following a socialist orientation". The recognition of multi-sectoral economy, more specifically of private ownership, was a significant change from the previous regime under the Constitution 1980 which recognized only ownership by the entire people and by collectives.

 

National Assembly

The Vietnamese government is not structured based on the theory of the separation of powers. The National Assembly is constitutionally the body of highest power of Vietnam. It exercises the legislative power, determines the economic and social policies, domestic and international policies and financial and monetary policies of the country, approves the national budget, and supervises the activities of the Government, the People's Court and the People's Prosecutor.[x]

 

The National Assembly elects its Chairman, the President, Vice President, Prime Minister, the Chief Justice of the People's Supreme Court and Head of the People's Supreme Prosecutor. It approves the cabinet at the suggestion by the Prime Minister.

 

Although having very large constitutional powers, the National Assembly of Vietnam is not necessarily so powerful in practice, nor is its capability up to the requirements to assume such a centralized power. The majority of the deputies of the National Assembly are part-time deputies (of the current 493 deputies, only 29.41% are full-time deputies)[xi] who gather to discuss the business of the National Assembly only during two 30-day sessions a year.

 

Between these sessions, the Standing Committee of the National Assembly supervises the activities of the Government, the People's Court and the People's Prosecutor to ensure their conformity to the Constitution and the laws.

 

Administration

The central government

The Government of Vietnam includes the Ministries and the Ministry-equivalent bodies which are established by the decision of the National Assembly at the suggestion of the Prime Minister.

 

A comprehensive list of Ministries and Ministry-equivalent authorities could be found on the website of the Vietnamese government.

 

Partly due to the limited capacity of the National Assembly, the Ministries have important influence on Vietnamese legislation. See the section on Legal System.

 

Local government

Vietnam is organized into 64 provinces which are subdivided into districts. Below districts are communes. A list of the 64 provinces with links to the website of each provincial government can be found on the website of the Vietnamese government.

 

Each of these three geographic levels has their own local government consisting of a representative body elected by the local people every five years named the People's Council and the administrative body named the People's Committee, whose members are elected by the People's Council.[xii]

 

Judicial System

Court system

Vietnam has a two tier court system, including courts of first instances and courts of appeal. The judgments are then susceptible to further reviews under special circumstances. The court system consists of the Supreme Court, the provincial People's Courts and the district People's Courts. There are specialised courts at the Supreme Court and at the provincial level. These include the Criminal Court, Civil Court, Economic Court, Administrative Court and Labour Court.

 

The Chief Justice of the Supreme Court is elected by the National Assembly, has the term corresponding to the term of the National Assembly and can be re-elected. Other Justices of the Supreme Court are appointed and removable by the President and have the term of 5 years. The Chief Justice of the Supreme Court appoints and removes judges of the inferior courts.[xiii]

 

Under the law, Vietnamese courts render their judgments independently. However, there are still many concerns on the independence of the courts.

 

The tribunal panels at the first instance are composed of both judges and people's jurors (usually one judge and two people's jurors). People's jurors at each level are lay people elected by the People's Council of the same level at the recommendation of the Vietnam Fatherland  Front and could be re-elected.[xiv] The participation of these jurors who are not qualified legal expert and who are elected, re-elected and removable by the local governments raises questions on their capability and on the influence of the local governments on the court's activities.

 

The law in 2002[xv] centralized the appointment of the judges by the Chief Justice of the Supreme Court instead of appointment by the local People's Council. The budgeting of the local courts, previously decided by the provincial Departments of Justice, is now decided by the National Assembly. This made the local courts more independent from the local government.

 

Another factor leading to the concerns on the independence of the courts is the unwritten practice of the local court requesting for opinion from the superior court in complex cases.[xvi]

Judgments in Vietnam are not publicly published and it is difficult to get access to past judgments.

 

The government is carrying out a judicial reform program which hopefully will improve the operation of the courts.[xvii] The country is also pressed for changes under the commitments made in its adhesion to the World Trade Organisation.

 

People's Prosecutor

The People's Prosecutor has the mandate of public prosecution and judicial supervision. Similarly to the structure of the court, the People's Prosecutor is organized into three levels: the Supreme People's Prosecutor, provincial People's Prosecutor and district People's Prosecutor.

 

In criminal cases, the People's Prosecutor carries out the public prosecution role. In non-criminal cases, the People's Prosecutor supervises the resolution of the cases and has the prerogative to participate in any part of judicial proceedings except for the conciliation process. [xviii] Usually, it reviews the file, listen to evidence and argument and make a recommendation to the tribunal panel.[xix]

 

In addition, the People's Prosecutor supervises the enforcement of the judgments.

 

Alternative Dispute Resolution

Mediation

Culturally, Vietnam is not a litigious society. A large number of disputes are resolved outside of court. Vietnamese laws also highly emphasize the role of mediation. Mediation is a mandatory part of certain litigation procedures such as civil litigations, labour and marriage and family litigations. The State encourages the resolution of civil and family disputes and violations of the law which do not amount to criminal offences by means of mediation. At the local community, groups of non-professional mediators are set up to carry out this mediation mandate.[xx]

 

Arbitration

Arbitration is a possible alternative for dispute resolution in Vietnam but restricted to commercial disputes only. Arbitration was not a popular dispute resolution means in Vietnam due to weak enforceability.

 

The Ordinance on Commercial Arbitration adopted in 2003 attempted to improve the effectiveness and enforceability of arbitration in Vietnam. Under the Ordinance 2003, arbitration award given by a Vietnamese arbitration tribunal is automatically enforceable, i.e. the parties no longer have to seek a decision of the court for the execution of the arbitral award. The most well-known Vietnamese arbitration organization is the Vietnam International Arbitration Centre at the Vietnam Chamber of Commerce and Industries.

 

Vietnam is a member of the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Foreign investors tend to refer to foreign arbitration whenever they can due to lack of confidence in the capability and transparency of Vietnamese courts. Until recently, the execution of foreign arbitral awards was troublesome due to the narrow definition of "commercial activities" under Vietnamese law. The New York Convention only guarantees national recognition of foreign arbitral awards on issues considered of commercial nature under the national law. The expansion of the definition of "commercial activities" under Ordinance 2003 made the enforceability foreign arbitration much more certain.

 

As part of Vietnam's judicial reform, it is expected that arbitration will be used more widely in civil disputes and not restricted to commercial disputes.

 

Legal System

The hierarchy of Vietnamese legal texts is as follows:[xxi]

 

Authority	Text
National Assembly	Constitution, Law, Resolution
Standing Committee of the National Assembly	Ordinance, Resolution
President	Order, Decision
Government	Resolution, Decree
Prime Minister	Decision, Directive
Ministers and head of ministry-level bodies	Decision, Directive, Circular, Joint Circular (issued collectively by different ministries or by a ministry and a political and social organisation)
Justice Council of the Supreme People's Court	Resolution
Chief Justice of the Supreme People's Court/ Head of the Supreme People's Prosecutor	Decision, Directive
People's Council	Resolution
People's Committee	Decision, Directive

 

Legal texts are published on the Official Gazette.

 

Vietnam's legal system is fast evolving and the legislation work has been significantly improved. In line with the increasing number of legal texts, the Official Gazette has increased its rate of publication from two issues per month in 1995 to daily in 2004. The number of laws and other legal texts increases rapidly. From early 2003,[xxii] legal texts must be published in the Official Gazette as a compulsory condition for becoming effective. This compulsory publication is a great improvement compared to the previous situation where most of legal texts became effective 15 days after the date of signature and not all legal texts were published. The dynamism and transparency of the legal system, as a result, were improved significantly.

 

Despite these significant improvements, Vietnamese legislation work is still weak resulting in the legal system being inadequate and unstable. One of the reasons explaining this shortcoming is the function of the National Assembly. The National Assembly does not consist of professional and specialized legislators. Its members are working people gathering only during two 30-day sessions per year. Its mandate of approving the country's economic and social development plans, financial and monetary policies, the national budget, as well as questioning the Government's activities takes up a large amount of time, leaving a modest agenda to legal debate and approval of laws. On the other hand, its legislation workload increased tremendously under the country's commitment under the 2000 U.S.-Vietnam Bilateral Trade Agreement and under the commitments in its adhesion to the World Trade Organization. Most of laws are passed after one or two session of debate by the National Assembly.[xxiii] Vietnam's first Competition Law, as a typical example, was given four days of debate before being passed into Law in November 2004. The input of the National Assembly on the country's laws is therefore still limited.

 

In practice, the real legislators are the administrators, particularly the Ministries. A set of rules on a specific issue in Vietnam typically includes: (i) a law drafted by a relevant Ministry, consented first by the Government, then approved by the National Assembly; (ii) an implementing Decree drafted by that Ministry and issued by the Government; and (iii) an implementing Circular issued by the same Ministry. Adding to this, a significant number of parliamentarians are administration officials. This has important impacts on the National Assembly's decision. Laws are usually drafted in such general terms that they are not enforceable without the implementing decrees and circulars.

 

This legislation process magnifies the power of the executives, conferring them the unwritten power to interpret law. Constitutionally, this is in the power of the Standing Committee of the National Assembly. In the absence of a specialised and effective supervisor of the constitutionality and legality of legal documents, interpretation of the executive bodies sometimes results in a de facto amendment to the law.

 

Jurisprudence is not recognized as a source of law and is not part of the legal system. However, as a matter of practice, every year, the Supreme Court produces a collection of typical cases with comments and instructions. These treatises are relied on seriously by the inferior courts.

 

There is no formal process of codification in Vietnamese law. In certain important area where the law issued by the National Assembly is relatively comprehensive and complete, the name "Code" is used. To date, following are the major codes: the Civil Code, the Civil Procedure Code, the Criminal Code, the Criminal Procedure Code, the Labour Code, and the Maritime Code.

 

Informal compilation of legal texts in specific areas are carried out and published by different publishing houses. The most reliable source is the National Political Publishing House which publishes a wide range of legal texts and compilations of legal texts. The National Political Publishing House operates under the Communist Party of Vietnam. It has been assigned by the Politburo the mandate of publishing political and legal publications.[xxiv]

 

Legal profession

The legal profession in Vietnam is regulated by the Ministry of Justice and the bar associations set up in each province. To practice law in Vietnam, it requires a certificate of law practice issued by the Ministry of Justice and admission to the bar association at the place of residence of the lawyer. The relevant bar association will issue Lawyer Licence to its members.

 

The new Law on Lawyers[xxv] provides for a nationwide lawyer association which will be called Vietnam Lawyers Federation and which is expected to be established later 2008.[xxvi]

 

Like the Vietnamese legal system, the growth of the legal profession in Vietnam was greatly influenced by the demand of economic growth and of the country's open policy. Before the promulgation of the Ordinance on Lawyers in 2001, admission to the bars was at the discretion of each bar association and was thus very difficult and in some provinces impossible. The Ordinance makes the admission to the bar a matter of rights as long as the applicant satisfies the requirements provided by law. This, together with the rapid economic growth in the last few years, has helped increase the number of lawyers rapidly. From 369 lawyers in 1991, the number of lawyers has increased to 2,100 in 2001 and 5,000 in 2007.[xxvii] The number, experience and exposure of Vietnamese lawyers are however still modest. The Vietnamese government is putting effort in improving the experience and competence of its lawyers, seeing this essential in the country's integration into the global economy.

 

The legal profession has also witnessed liberalisation recently as one of the commitments under the services schedule made by the Vietnamese government in its adhesion to the World Trade Organisation. With the adoption of the new Law on Lawyers in 2006, foreign law firms in Vietnam can now advise Vietnamese laws and have the audience of Vietnamese courts through their employed Vietnamese lawyers. Before the 2006 Law, Vietnamese lawyers employed by foreign law firms were not allowed to appear in courts and before the 2001 Ordinance, foreign law firms in Vietnam were not allowed to employ Vietnamese lawyers or advise on Vietnamese laws at all.

 

The lack in number of lawyers is explained by the non-litigious nature of the Vietnamese society, the lack of competence of the court and the limited involvement that Vietnamese lawyers are allowed in the litigation process. With the ongoing judicial reform, the involvement of lawyers in litigation procedure has recently become subject to great debate which has resulted in improvement of the role of the profession in recent years.

 

Research Resources

The research resources on the Vietnamese legal system are still limited. Following are some useful resources.

• The Institute on State and Law has a library at 27 Tran Xuan Soan, Hanoi, Vietnam, Tel.: (844) 9713 334
• The National Library has a collection of diverse materials including legal materials. Notably, it has certain resources on the old legal texts and legal system before the establishment of the current government of Vietnam. It is located at 31 Trang Thi, Hanoi, Vietnam, Tel.: (844) 8255 419
• The Central Institute for Economic Management under the Ministry of Planning and Investment carries out certain researches on business law issues. Their library contains the Official Gazette, Vietnam Law Database and other materials relating to Vietnam's economic reform.
• Part of the World Bank's global network of public information centers, the Vietnam Development Information Centre has a collection of materials on Vietnam and Vietnamese economy by the development actors.
• All of the legal texts are now published on the Official Gazette. This publication has an English version in hard copy.
• The Vietnamese versions of legal texts could now be accessed online for free at www.vietlaw.gov.vn, managed by the Office of the National Assembly. Some business legal texts in English could be accessed for free here.