MINISTRY OF JUSTICE MINISTRY OF EDUCATION AND TRAINING NGUYEN HUONG THAO 452915 MULTI-TIERED DISPUTE RESOLUTION CLAUSES: THEORY AND PRACTICE BACHELOR’S DISSERTATION NGUYEN HUONG THAO 452915 MULTETIERED DISPUTE RESOLUTION CLAUSES: THEORY AND PRACTICE Major: International Trade and Businesses Law BACHELOR’S DISSERTATION SUPERVISOR LLM. Nguyen Mai Linh DISCLAIMER I hereby declare that this dissertation is my own work. The conclusions and datas in the Bachelor's Dissertation are truthful and reliable / Supervisor's certification Author of the Bachelor s Dissertation Gign and write full name) LIST OF ABBREVIATIONS ADR Alternative dispute resolution Arb-Med Arb Arbitration-Mediation-Arbitration BIT Bilateral Investment Treaty CPR Civil Procedure Rules DAAB Dispute Avoidance/Resolution Board DAB Dispute Adjudication Board DNP Defects Notification Period DRB Dispute Review Board ELR Exhaustion of local remedies EU European Union EVIPA Vietnam - European Union Investment Protection Agreement FIDIC International Federation of Consulting Engineers FTA Free Trade Agreement ICC International Chamber of Commerce ICCPR International Covenant on Civil andPolitical Rights ICSID International Centre for Settlement of Investment Disputes ILC International L aw Commission LCA Law on Commercial Arbitration LML Litigation-mediation-litigation MDR Multi-tiered dispute resolution Med-Arb Mediation-Arbitration Most-favoured-nation NAFTA North American Free Trade Agreement NOD Notice of Dissatisfaction OHADA Organization for the Harmonization of Business Law in Africa SCCMS Small Case Commercial Mediation Scheme SIAC Singapore International Arbitration C enter SICC Singapore International Commercial Court SIMC Singapore International Mediation C entre SIMI Singapore International Mediation Institute SMC Singapore Mediation C enter SOP Act Building and C onstruction Industry Security of Payment Act TIC Technology, Infrastructure and C onstruction UK United Kingdom. UNCITRAL United Nations Commission on International Trade Law US United State VIAC Vietnam International Arbitration C entre VMC Vietnam Mediation C entre TABLE OF CONTENTS INTRODUCTION ẽeCa.
The scientific and practical contrib ution 4, Research objectives 5. Scope of research 6. Dissertation disposition th CHAPTER 1: OVERVIEW OF MULTI-TIERED DISPUTE RESOLUTION CLAUSES öœ- 1. Definition of multi-tiered disp ute resolution clauses 1.
Disp ute resolution methods in multi-tiered disp ute resolution clauses 1. Consensual alternative dispute resolution methods 1. Quasi-adjudicative alternative dispute resolution methods 10 13. Key characteristics of multi-tiered disp ute resolution clauses 12 1.
Enforceability in Court and Arbitration 12 1. Scope of the duty to follow the agreed mutti-tiered dispute resolution clauses 14 1. Means of enforcing uulti-tiered dispute resolution clauses 15 1. The role of multi-tiered disp ute resolution chuses 21 CONCLUSION FOR CHAPTER 1 24 CHAPTER 2: IMPLEMENTATION OF MULTI-TIERED DISPUTE RESOLUTION CLAUSES IN INTERNATIONAL PRACTICE 25 2.
Practice of multi-tiered dispute resolution chuses in international construction 25 2. Practice of multi-tiered dispute resolution chuses in international investment 30 2. Practice of multi-tiered disp ute resolution clauses in some countries 35 2. Common law — Singapore 35 2.
Civil law — England ề CONCLUSION FOR CHAPTER 2 46 CHAPTER 3: IMPLEMENTATION OF MULTI-TIERED DISPUTE RESOLUTION CLAUSES IN VIETNAMESE REGULATIONS 47 3. Legal framework regarding multi-tiered disp ute resolution clauses 47 3. Regarding law ou arbitration 47 3. Regarding law on construction 49 3.
Regarding law ou international investment 50 3. Opinions of Court and Arbitration regarding the enforceability of multi- tiered disp ute resolution clauses $1 3. Recommendation for Vietnam 56 CONCLUSION FOR CHAPTER 3 62 INTRODUCTION 1. Research rationale Enterprises globally are increasingly turning to alternative dispute resolution (ADR) mechanisms amidst rising commercial disputes, favoring efficiency, security, and confidentiality over traditional litigation Notably, arbitration has gained international acceptance, prompting countries like Vietnam to emphasize its importance through legislative measures like the Lay on Commercial Arbitration (LCA).
While arbitration offers benefits, it has limitations, leading parties to often opt for amicable resolutions before resorting to arbitration, aiming to streamline proceedings, minimize costs, and preserve relationships. In civil and commercial law, pre-litigation resolution agreements, including multi-tiered dispute resolution (MDR) clauses, are common but pose legal complexities. These agreements raise questions about their binding nature, procedural courses in cases of objection, and their impact on arbitration proceedings and awards. Uncertainties persist in Vietnam regarding the potential of MDR clauses to annul arbitration awards due to the absence of explicit provisions in the 2010 LCA, underscoring the need for scholarly inquiry.
Hence, the author's chosen topic, “Multi- tiered dispute resolution clauses: Theory and Practice”, delves into these complexities, aiming to contribute to refining legislative structures for alternative dispute resolution mechanisms in Vietnam and beyond. Literature review Through the process of surveying and researching the author has discerned that the issue of MDR clauses has been extensively examined abroad and has been the subject of discussion in a limited number of domestic research endeavors. Consequently, these scholarly works can be categorized as follows: 2. Domestic framework @® Firstly, concerning scholarly works produced in the genre of monographs: In his publication “Arbitration mechanism in the context of international economic integration” (2022), authored by Dr.
Do Van Dai, extensive insights into pre-arbitration agreements in dispute resolution are provided The author meticulously presents practical legal applications and conducts comparative analyses with the legal frameworks of several nations worldwide. Notably, the work also incorporates the latest provisions of the Organization for the Harmonization of Business Law in Africa (OHADA), offering specific regulations on pre-arbitration agreements. These insights hold significant value for the development of Vietnamese law. = Another seminal contribution by Dr.
Do Van Dai, “Vietnam Commercial Arbitration Law - Verdicts and Commentary (Volune 1)” (2017), merits scholarly attention The commentator's discerning analysis distinguishes between pre- arbitration agreements in scenarios characterized by voluntary and mandatory pre- arbitration procedures. Through a comprehensive examination of practical cases and a meticulous comparison with the legal frameworks of France, Switzerland, and the United States, the monograph offers pragmatic solutions to address instances where a patty objects to arbitration proceedings due to the purported non-completion of pre- arbitration procedures as stipulated. The commentator's elucidation underscores the lack of uniformity in trial practicesin Vietnam and offers insightful recommendations for aligning Vietnamese law with international standards. While the exploration of various facets within arbitration law is thorough, the monograph does not delve extensively into the nuanced complexities of pre- arbitration agreement issues.
Gi) Secondly, concerning scholarly articles published in legal journals: Tran Viet Dung's article (2021) titled “Resolving breaches of Pre-arbitration agreements: Global insights and legislative recommendations for enhancing Arbitration Law in Iiemam”, featured in the Vietnam Joumal of Legal Sciences, Issue 01(140)/2021. In this paper, the author conducts an in-depth analysis of the essence and objectives of multi-tier dispute resolution clauses, drawing on international judicial practices and theoretical frameworks of arbitration law. Through comparative examinations of diverse approaches adopted across various jurisdictions, the author constructs and advocates legislative reforms tailored to Vietnam's arbitration landscape. This meticulously crafted study not only lays the groundwork for subsequent research endeavors by identifying nascent legal controversies surrounding pre-arbitration agreements but also aims to delve deeper into the theoretical underpinnings of such agreements, assimilate recent jurisprudential developments, and proffer cogent insights applicable to Vietnam Cao Anh Nguyens article (2017) titled “Pre-arbitration procedies: Theoretical and practical considerations in broadening arbitral jurisdiction”, published in the Journal of Legislative Research, Issue 21 (349) November 2017.
In this scholarly exposition, the author elucidates the inadequacies inherent in the 2010 Commercial Arbitration Law of Vietnam, which overlooks the imperative of pre- arbitration negotiation and conciliation, opting instead to acknowledge conciliation solely within the arbitration process. Furthermore, the article expounds upon the pivotal role and consequential advantages of MDR clauses for disputing parties. Acknowledging the seminal contribution of this study in illuminating novel theoretical insights into pre- arbitration procedures and delineating legislative lacunae concerning pre-arbitration negotiations and conciliation, the author endeavors to integrate concepts pertinent to MDR clauses and advocate for requisite legislative amendments in their dissertation 2. Globalframework In the global context, within the scope of the author's research, numerous comprehensive studies are renowned for providing reliable information pertinent to the subject matter.
Several notable works include: Nigel Blackaby et al. (2018), “International Arbitration - sixth edition”. This work stands as a comprehensive research endeavor on commercial arbitration law, wherein the authors offer commentary on various procedural aspects and arbitration proceedings. They also furnish illustrative examples to address practical challenges, collating provisions, rules, and guidelines from the Model Law, arbitration laws, and arbitration rules of numerous jurisdictions worldwide.
Regarding pre-arbitration agreements, the authors introduce ADR methods, delineate the concept and benefits of MDR clauses, and analyze the approaches of courts in countries such as the United Kingdom, Switzerland, and Singapore regarding the enforcement of pre-arbitration procedures. This work serves as an invaluable reference for researching pre- arbitration procedures, offering a global survey of multi-tier dispute resolution clauses in regions such as Asia-Pacific, the OHADA, and the European Union (EU) Kayali, D (2010), “Enforceability of Milti-fiered Dispute Resolution Clauses”, published in the “Journal of International Arbitration”, Volume 27(6). This article raises issues concerning the enforceability of multi-tiered dispute resolution clauses when one party fails to adhere to the prescribed procedures outlined in the contract. It provides definitions of MDR clauses, explores different perspectives of scholars, courts, and arbitral tribunals on the nature of such clauses, and elucidates the essential elements for their validity.
The scientific and practical contr ution The research enriches theoretical frameworks by delving into the intricate dynamics of MDR approaches, illuminating their underlying principles and mechanisms. Drawing from multiple disciplines such as law, psychology, economics, and sociology, the study fosters interdisciplinary dialogue and sets the stage for further theoretical development in Vietnam. In terms of practical contributions, the study offers actionable insights for stakeholders in Vietnam, including businesses, legal professionals, and policymakers, to improve dispute resolution processes. Through comprehensive analyses and practical recommendations, parties can navigate disputes more effectively, reducing costs and preserving relationships.
Furthermore, by pinpointing key factors influencing the effectiveness of multi-tiered dispute resolution mechanisms, the research empowers stakeholders to tailor strategies to the Vietnamese context, whether negotiating contracts, drafting dispute resolution clauses, or resolving conflicts, ultimately leading to fair and satisfactory outcomes in the Vietnamese business environment. 4, Research objectives (Ò Firstly, to elucidate certain theoretical issues concerning MDR clauses. (ii) Secondly, to identify existing deficiencies and practical shortcomings in Vietnamese law and legal practice concerning MDR clauses. (iii) Thirdly, to analyze and evaluate the global legal framework and practices in international construction and investment areas, as well as several jurisdictions renowned for their legal systems, including common law and civil law systems such as the United States, England, Singapore, with the aim of deriving pertinent experiences and provisions adaptable to the legal framework and socio-economic realities of Vietnam.
Scope of research In order to attain a more impartial and thorough grasp of the legal provisions concerning MDR clauses, the author conducted an investigation based on legal docum ents both domestically and internationally. With regard to dom estic legislation, scrutiny was directed towards the stipulations outlined in the 2010 LCA, Resolution No. 01/2014/NQ-HDTP, issued by the Council of Judges, which offers guidance on the implementation of specific provisions of the LCA, as well as Decree No. 22/2017/ND-CP, promulgated by the Government, which provides detailed regulations pertaining to commercial mediation Furthermore, an analysis was undertaken of pertinent provisions contained within the 2015 Civil Code andthe 2015 Civil Procedure C ode.
In the realm of international law, meticulous examination was conducted on the legal frameworks of various jurisdictions typified by common law and civil law systems, such as England, the United States, Singapore, Hong Kong. Additionally, scrutiny encompassed the provisions of the United Nations Commission on International Trade Law (UNCITRAL) Model Laws, including the Model Law on International Commercial Arbitration 1985, as amended in 2006 (Model Law 2006), the Model Law on International C omm ercial Conciliation 2002 (Model Law 2002), and the Model Law ơn International Commercial Mediation and ConciliationAgreements 2018 (Model Law 2018), the FIDIC Contracts regarding the international construction area, relevant cases and bilateral investment treaties (BITS) regarding the international investment area, in addition to the arbitration and mediation laws of various countries and the regulations of select international arbitration bodies. Methodology To conduct the inquiry, the author utilizes a methodology integrating dissertation, theoretical frameworks, and soft law provisions, along with expert insights, to analyze the discussed issues.