13 April, 2020

VIETNAM: Is covid-19 outbreak an event of force majeure? How the laws of Vietnam regulate about force majeure, rights, obligations and responsibilities of parties to a contract in case of occurring an event force majeure? 

 

Force majeure is a rather complicated issue under the laws of Vietnam. Courts and arbitrators heard and judged many disputes related to force majeure circumstances, and it should be noted that any occurrence of the events of force majeure defined and regulated in the contracts will be certainly accepted by courts, arbitrators, resulting in a situation that party suffering from such event will certainly be exempted from implementing its obligations, responsibilities stipulated in such contracts.

 

It has been recently published and discussed in the public communication means, newspapers, and social network forums different views, including legal views, on the coronavirus/COVID-10 pandemic, subjectively judging that coronavirus/COVID-19 epidemic outbreak in Vietnam is an event of force majeure, and party suffering from such event will be exempted from implementing its obligations, responsibilities stipulated in the contracts of various types, such as premise leases for business, sale and purchase contracts, service supply contracts, contracts for “lump system” of products/property, credit/loan agreements and contracts of other types. In consideration of such judgments flood in local mass media, many parties are considering various ways to unilaterally terminate contracts signed with their partners, with a hope that they would be exempted from implementing their contractual obligations, responsibilities. We suggest that you should be careful and should seek advice from counsels of high seniority and long-standing experience on force majeure under the laws of Vietnam before taking action of unilateral termination.

 

Last Friday, April 10, 2020, a group of high-seniority counsels of BIZCONSULT LAW FIRM have comprehensively discussed on their study and legal assessments on force majeure events, as to when and in what circumstances coronavirus/COVID-19 epidemic disease outbreak and certain preventive measures and lockdowns imposed by the Government of Vietnam for preventing and fighting against the fast and wide spreading of the epidemic disease would be considered a force majeure event, and that in such situation what and how rights, interests, obligations and responsibilities of each party to contract will be determined and judged in accordance with the laws of Vietnam.

 

If you are facing to any of the above issues, contact us for advice on your specific issue.

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