Ebook Những nội dung cơ bản của Luật thương mại năm 2005: Phần 2

KEYISSUES
IN THE 2005 COMMERCIAL LAW

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INTRODUCTION
To díssemínate the main contents ofenacted important
codes and ỉaws, such as the Civiỉ Code, the Lũw on
ỉnvestment, the Law Intellectual Property and the Law on
Enterprise to the business community, Vietnamese and foreign readers, the dudiciaỉ Pubỉishing House, ỉn coordination ivith the Internationaỉ Law Department, the Minỉstry
o f ổustice, publishes some books in hoth Vietnamese and
English to introduce the code and ỉaws said above.
ỉt ís our hope that the publications o f the dudỉciaỉ
Publishing House will be useful for those domestic and foreỉgn individuals and organỉzations who are ỉnterested in
ỉearning about the Vietnamese laws. We aỉso hope that
these books will contribute to ensuring transparency o f the
Vietnamese legal system • one o f the requỉrements for this
country to become a m ember o f the World Trade
Organization (WTO).
I

We, therefore, have the honor to introduce this book to
readersĩ

A pril 2007
THE JƯDICIAL PƯBLISHING HOƯSE
223



Partl
INTRODUCTION TO THE 2005 COMMERCIAL LAW

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Part I. Introductìon to the 2005 Commercial Law

I. STRUCTURE 0F THE 2005 COMMERCIAL LAW
The 2005 Commercial Law comprises 9 Chapters withị
324 Articỉes (the 1997 Commercial Law comprised 6

Chapters with 264 Articles), of which 96 and 149 Articles
of the 1997 Commercial Law were repealed and amended
respectively and 143 articles were supplemented to form
the new Law. The structure of the new Law is as foliows;

Chapter I: General Provisions
Chapter II: Sale and Purchase of Goods
Chapter III: Supply of Services
Chapter rV: Commercial Promotion
Chapter V: Commercial Intermediary Activities
Chapter VI: Some Other speciĩic Commercial activities
Chapter VII: Commercial Remedies and Commercial
Dispute Resolution

Chapter VUI: Handling of Commercial Law Violations
Chapter IX: Implementation Provisions
II. KEY ISSUES IN THE 2005 COMMERCIAL ư^w
1.
Concept of commercial activities and governing
scope of the 2005 Commercial Law
The 2005 Commercial Law avoids muddled defmitions
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Key issues in the 2005 Commercial Law

of commercial activities, commercial acts and traders as
contained in the 1997 Commercial Law. In addition, the
2005 Commercial Law does not list commercial activities
as the 1997 Law did. The new Law deĩines commercial

activities as actỉưities for the purpose o f generating profits,
including: sale a n d purchase o f goods, supply o f servỉces,
inưestment, com m ercial prom otion an d other actỉvities for
the profit purpose. Article 2 of the 200Õ Commercial Law
provides that subjects of application of the Law inclưde
traders and other organizations and individuals conducting
commerce-related activities. Therefore, the concept of
commerciaì activities in the new Law is broader than that
in the 1997 Law. It includes not only commercial activities
of traders but also other activities for profit purposes of
organizations and individuals who are not traders but conducting commerce-related activities.
The widening of the concept of commercial activities in
Article 1 of the 2005 Commercial Law helps widen the
coưerage o f the Laiv as follows:
.
- The 2005 Commercial Law does not cover the m atter
oĩ''legaỉ status o f traders'*. As a result, there is no separate
section providing for traders like the 1997 Law. In addition, the 2005 Commercial Law also governs activities not
for profit purposes conducted by a party in its transactions
with traders in cases where the party conducting such notfor-profit activities chooses to apply the Law.
- With regard to territorial scope, the 2005 Commercial
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Part I. Introductỉon to the 2005 Commercíal Law

Law provides not only for principles and standards of commercial activities conducted in the territory of the Socialist
Republic of Vietnam, but also for commercial activities con*
ducted outside the territory of the Socialist Republic of
Vietnam in cases vvhere the involved parties agree to apply

the Law, or where a foreign law or a treaty to which the
Socialist Republic of Vietnam is a contracting party stipulates the application of the Law. Such vvidening of the
governing scope reAexes the features of commercial relations,
especially those relating to ĩoreign trade conducted by
traders of different nationalities in different territories.
2. Concept of traders and subjects of application

Subjects of application of the Commercial Law are
defined as traders conducting commercial actívities in the
territory o f the Sociaỉist Republíc o f Víetnam (Article 2 of
the 2005 Commercial Law), which include both Vietnamese
traders and ĩoreign traders conducting commercial activities in the territory of Vietnam. The 2005 Commercial Law
shall apply to subjects who are not traders in cases vvhere
those subjects choose to apply the Law.
Clause 1 in Article 6 of the 2005 Commercial Law
defines traders as '"lawfully established economic organita-

tions and individuaỉs that conduct commerciaỉ actỉvỉtíes in
an independent and reguỉar manner, and have business
regỉstrations'\ This derinition clearly confirms the inde*
pendence betvveen concept of traders and its legal forms.
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Key issues in the 2005 Commercial Law

Any legal form such as business registerred individuals,
limited liability companies, joint stcxĩk companies, private
enterprises, partnerships, State companies, co-operatives,
shall become traders when conducting commercial activities in the market. Business registration by traders shall

be carried out in accordance with legal provisions on business registration.

Poreign traders conducting commerciaỉ actỉuitỉes in the
territory o f the Sociaỉỉst Repubỉic ofV ietnam
In the process of International economic integration,
the openning of Vietnam’s market for foreign traders to
have access to is a natural trend. Previously, pursuant to
the 1997 Commercial Law and the Law on Poreign
Investment in Vietnam, íoreign invested enterprises
established in Vietnam were entitled to invest in
machines, production lines and conducting business in
Vietnam but were not entitled to conducting commercial
activities in a regular manner. It partly limited the flows
of foreign investment, creating unequality between domestic investors and foreign investors; maniíesting unnecessary protection by the State for domestic enterprises; and
somehow distorting competition environment.
For the purposes of creating an equal investment environment and encouraging flows of foreign investment,
Section 3 in Chapter I of the 2005 Commercial Law deĩines
forms of, and rights to, conducting commercial activities by
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Part I. Introduction to the 2005 Commercial Law

foreign traders in Vietnam. It is an important new point
creating equal and favorable conditions for foreign traders
conducting commercial activities in Vietnam.
The 2005 Commercial Law also clearly provides for
competence to license foreign traders to conduct commercial activities in Vietnam. The Planning and Investment
Ministry shall be responsible for managing the issuance of
licences to foreign traders investing in Vietnam in accordance with Vietnamese legal provisions on íoreign investment. The Trade Ministry shall be responsible before the

Government for managing the issuance of licences to set
up Vietnam-based representative offices of íoreign traders;
or licenses to set up branches, joint-venture enterprises or
enterprises with 100% foreign Capital in Vietnam in cases
vvhere such traders are specialized in conducting activities
of goods purchase and sale or other activities directly related
to goods purchase and sale. Hovvever, vvhere a specialized
law contains specific provisions on the competence of
ministries or ministerial-level agencies, which are responsible before the Government for managing the issuance of
licences to foreign traders for conducting commercial
activities in Vietnam (for example, the Law on Insurance
Business, and the Law on Credit Organizations and so on),
the provisions of such specialized law shall apply. This provision on competence to license foreign traders is in accordance with the current legal system of Vietnam.
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Key issues in the 2005 Commercial Law

3. Sale and purchase of goods

Pursuant to the 2005 Commercial Law, goods include

aỉl types o f movables, including those to be formed in the
future and things attached to ỉand. This concept of goods
has been widened in comparison to that in the 1997
Commercial Law. This provision is also consistent with the
2005 Civil Code which considers properties to be formed in
the íuture as one type of goods.
3.1 GeneraỊ provỉsions on sale and purchase otgoods

The 2005 Commercial Law provides for domestic sale
and purchase of goods and international sale and purchase
of goods.
Although the concept of goods is too broad as mentioned above, Article 25 of the Law supplements provisions
on goods subject tx) restrictions to trade, goods subject to
conditions to trade. Accordingly, traders must satisfy conditions provided for by relevant laws when conducting business in such goods. In addition, the 2005 Commercial Law
has new provisions on application of urgent measures with
regard to gcx)ds domestically circulated. According to these
provisions, legally and domestically circulated goods may
be subject to the application of one or all of urgent measures
as compulsory withdrawal from circulation, ban from
circulation, suspension from circulation, conditional circulation, or compulsory circulation permission in cases where
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Part I. Introduction to the 2005 Commercial Law

such goods constitute sources or transmitters of various
epidemics and diseases; or in cases where an emergency
circumstance occurs. These provisions are for the State
management over the market to ensure that the right to
írecdom of conducting business bv traders does not harm
legitimate interests of consumers and the public order.

With regard to internatíonal sale and purchase o f goods,
the 2005 Commercial Law reaffirms the right to export
and/or import any type of goods by traders, except for goods
subject to prohibition to export and/or import. On the basis
of socio-economic conditions in each period, the Government
shall speciíy the lists of goods banned from import and/or

export. With regard to goods to be imported or exported
under licences of competent State management agencies,
procedures for granting such licences must be in a transparent
manner in accordance with the WTO Agreement on Import
Licensing Procedures. In the 200Õ Commercial Law, many
new pro\àsions have been supplemented in comparison with
the 1997 Commercial Law as follows:
The 1997 Commercial Law provided for contracts for
sale and purchase of goods signed with ĩoreign traders and
identified such type of contracts by nationalities of those
traders. The 2005 Commercial Law does not use the concept of contracts for sale and purchase of goods with ĩoreign
traders but provides for International sale and purchase of
goods (Article 27) and theroby widenning the scope of such
contracts;
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Key íssues in the 2005 Commercỉal Law

The 2005 Cotnmercial Law newly provides for application of urgent measures to activities of International sale
and purchase of goods (Article 31).
In addition, the 2005 Commercial Law also supplements nevv provisions on import and/or export activities
such as labelling of goods and rules of origin of goods, serving
as legal bases for the Government guiding such provisions
in detail for the effective implementation in practice.

3.2. Rights and obỉigations of parties to a contract for
sale and purchase of goods
The 2005 Commercial Law provides for rights and
obligations of parties to a contract for sale and purchase of

goods in detail on the basis of inheriting provisions on sale
and purchase of goods in the 1997 Commercial Law,
making reĩerence to the 1980 Vienna Convention of
International Sales of Goods and international practices of
sale and purchase of goods. It helps make the Law s provisions on sale and purchase of goods most suitable to
Vietnam’s practical conditions as follows:

With regard to oblỉgations o f sellers, the Law supplements some provisions on delivery of goods in cases where
there is no agreement or an unclear agreement on place of
delivery (Article 35), time limit for delivery (Article 37),
obligation of the seller in cases where goods are subject to
measures of security for performance of civil obligations
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Part I. Introduction tỡ the 2005 Commercial Law

(Article 48), obligation to assure intellectual property
rights over goods (Article 46), and requirement of notification (Article 47).

With regard to pass ofrisks and pass ofownershỉp, the
Law supplements provisions on pass of risks such as: pass
of risks in cases where there is a Tixed place of delivery of
goods (Article 57); pass of risks in cases where there is no
fixed place of delivery of goods (Article 58); pass of risks in
cases where goods are handed over to a bailee that is not a
carrier (Article 59); pass of risks in case of sale and purchase of goods in transportation (Article 60); and pass of
risks in other cases (Article 61).

With regard to obỉỉgations o f buyers, the Law amends

and supplements provisions on place of payment (Article
54); time limit for payment in cases where there is no
agreement betvveen parties (Article 55); obligation to
receive goods (Article 56); and performance of other suitable obligations by the buyer to ensure legitimate interests
of the seller. It is an important change based on the principle of ''ỉogicalitỷ'- the basic principle to identiíy obligations of parties to a commercial transaction. The practice
of commercial activities shows that parties to a contract do
not alvvays agree in detail on time limit for delivery, place
of delivery, price, time limit for payment, place of payment.

All these issues were mandatory to be contained in a contract as provided for in the 1997 Commercial Law. In cases
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Key ỉssues in the 2005 Commercial Law

where parties to a contract have had no agreement or had
an unclear agreement on time limit for delivery of goods,
the law should provide for such cases in a manner that
creates íavorable conditions for parties to perform the contract. Provisions on pass of risks from the seller to the
buyer in each speciĩic case of delivery of goods in the 2005
Commercial Law are consistent vvith the principles in the
1980 Vienna Convention of International Sales of Goods.
4.
The Goods Exchange, and sale and purchase of
goods through the Goods Exchange
The Goods Exchange is not an organization that is to
buy and/or sell goods itself but is a place for buyers, sellers,
brokers or go-betweens to have chance to meet, to make buying or selling orders for goods, to form transactions among
themselves. Through the Goods Exchange, buyers and
sellers have more favorable conditions in meeting, exchanging,

bargaining or forming transactions. Transactions through
the Goods Exchange are basically forward ones. It means in
these transactions, time of delivery of goods is a point of
time in the future, not the point of time of transaction,
Through forward transactions, buyers and sellers are able
to carry out measures of security in terms of price, decreasing
risks of price íluctuation in the market.
The National Assembly decided that the Commercial
Law only provides for basic principles of the Goods
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Part I. Introduction to the 2005 Commercial Law

Exchange and sale
Goods Exchange. In
íixchange and sale
Goods Exchange are
(Articles 63-73).

and purchase of goods through the
the 200Õ Commercial Law, the Goods
and purchase of goods through the
provided for in Section 3 of Chapter II

These provisions focus on regulating tvvo major issues,
namely (i) organization and performance of the Goods
Exchange and (ii) transactions of gcx)ds through the Goods
Exchange.

With regard to the Goods Exchange, the 2005
Commercial Law provides that the Goods Exchange has
the íunctions of providing the material - technical condi*
tions necessary for transactions of purchasing or selling
goods; running trading operations; and listing specific
prices formed at the Goods Exchange at each specific time.
The conditions for the establishment of the Goods
Exchange, the povvers and tasks of the Goods Exchange,
and the approval of the operation charter of the Goods
Exchange shall be provided for by the Government. Goods
traded at the Goods Exchange shall be those promulgated
by the Trade Minister. Staff members of the Goods
Exchange shall not be allovved to conduct brokerage for or
purchase or sale of goods through the Goods Exchange.
The 2005 Commercial Law preliminarily provides for
traders who act as brokers at the Goods Exchange.
Brokers for purchase and sale of goods through the Goods
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Key íssues in the 2005 Commercial Law

Exchange shall be aỉloNved to conduct only activities of brokerage for purchase and sale of goods through the Goods
Exchange and must not be a party to a contract for purchase and sale of goods through the Goods Exchange.

'With regard to sale and purchase o f goods through the
Goods Exchange, pursuant to Article 63 of the 2005
Commercial Law, it means commercial activities vvhereby
the parties agree to purchase and sell a defined quantity of
goods of a defmed type through the Goods Exchange under

the standards of the Goods Exchange, at a price agreed
upon at the time the contract is entered into, and with the
time of goods delivery determined to be a specific point of
time in the future.
The sale and purchase of goods through the Goods
Exchange shall be perỉormed under the form of contract
for sale and purchase of goods. Contracts for sale and purchase of goods through the Goods Exchange include forvvard contracts and option contracts. Option contracts
include call option contracts and put option contracts.
Article 65 and Articie 66 of the 2005 Commercial Law
provide for in detail rights and obligations of parties to a
forwaj:d contract; and rights and obligations of parties to
an option contract.
In order to ensure the stable períormance of the Goods
Exchange, and to prevent activities distorting the market,
the 2005 Commercial Law provides that parties involved
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Part I. Introductỉon to the 2005 Commercial Law

in the purchase and sale of goods through the Goods
Exchange must not commit fraudulences or deceits about
volumes of goods in forward or option contracts, which are
transacted or may be transacted, and íraudulences and
deceits about real prices of goods in forward or option contracts; not supplying false information on transactions, the
market or prices of goods purchased or sold through the
Gcx)ds Exchange; and not applying illegal measures to
cause disorder of the goods market at the Goods Exchange.
In addition, the 2005 Commercial Law allovvs the Trade
Minister to interfere in the Goods Exchange in emergency

cases where the disorder of the goods market occurs, making
transactions through the Goods Exchange unable to
accurately reílect the goods supply and demand relation.
In such cases, the Trade Minister shall be entitled to apply
one of the measures such as temporarily suspending
transactions through the Goods Exchange; limiting
transactions within a price bracket or a specific quantity
of goods; changing the schedule of transactions; or adjusting
the operation charter of the Goods Exchange.
In order to create legal bases for Vietnamese traders to
have a better access to import and export markets, the
Law also provides that: **Vietnames€ traders are entitled to

conduct purchase and sale ofgoods through overseas Goods
Exchanges'\ Conditions and modalities to participate in
such Goods Exchanges shall be provided for by the
Government.
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Key ỉssues ỉn the 2005 Commercial Law

5. Supply of services
Together with the vvidening of concept of commercial
activities to cover any activity to generate profit, including
supply of services, the 2005 Commercial Law embodies a
separate section on supply of services in Chapter III. It is
a new Chapter supplemented to the 2005 Commercial
Law in order to create legal framework for trade in services.
This Chapter is divided into two sections, namely

"'General provisỉon o f activities o f supply o f servỉces'' and

"'Rights and obligations o f parties to a contract for supply
ofservices\
Like provisions on trade in goods, the 2005
Commercial Law only provides for general issues relating
to activities of supply of services.
The 2005 Commercial Law cannot provide in detail for
all types of services but only for a legal framework on trade
in services. All services must comply with legal provisions
of relevant specialized laws first.
Framework provisions on rights and obligations of
parties to a contract for supply of services have been supplemented. These provisions shall become legal framework
for all types of contracts for supply of services in commercial activities. It helps create uniformity in Vietnam s legal
system and cover all types of services contracts that vvere
not provided for before.
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Part I. Introduction to the 2005 Commercíal Law

6. Logistics services
Logistics services have been well developing in the
world. Article 233 of the 200Õ Commercial Law defines
''ỉogistics services'' as commercial activities whereby
traders organize the performance of one or many jobs
including reception, transportation, warehousing, yard
storage of cargoes, completion of customs procedures and
other formalities and paperwork, provision of consultancy
to customers, services of packaging, marking, delivery of

goods, or other services related to goods according to agreements with customers in order to enjoy Service charges.
Thereíore, logistics services are not a single S e r v i c e
but include a series of services for delivery and reception
of goods (therefore, ^Hogístics'' are always in plural form).
Logistics services are the very combination of services for
delivery, reception, transportation, warehousing, yard
storage of cargoes. Such services make use of inĩormatics
technology in the process of circulating goods from producers to consumers through transportation, warehousing
and distribution of goods. In the process of goods
transportation, there are also flows of information of
logistics services. Today, many goods delivery and reception companies and goods delivery and reception associations have changed their names to logistics services
providers and associations of logistics services providers
to reflex this practice.
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Key issues in the 2005 Commercial Law

In essence, logistics services are provided for in the
2005 Commercial Law in order to broaden the coverage for
services of delivery and reception of goods in the old Law,
making it consistent with the practice of international
trade. Basically, the structure of provisions on logistics
services in the 2005 Commercial Law is similar to that in
the 1997 Commercial Law. Some noticeable changes in
content are as follows:
0

Eirstly, changing the title of the section to “Logistics
services” in order to broaden concept of goods delivery and

reception to concept of ''logistics' which is wellknown in
international trade. Goods delivery and reception Service
is only one type of logistics services.

Secondỉy, supplementing provisions on obligations of
traders who implement their right to vvithhold goods while
providing logistics services in order to ensure consumers’
ligitimate rights and interests.
7.
Transit of goods through the Vietnamese terrítory
and goods transit services
Pursuant to provisions of the 2005 Commercial Law,
transit of goods means the transportation of goods owned by
foreign organizations or individuals through the Vietnamese
territory, including transshipment, portage, warehousing,
shipment separation or alteration of modes of transportation
or other jobs performed in the course of transit.
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Part I. Introduction to the 2005 Commercial Law

Therefore, transit of goods is in essence different from
import and export activities of goods to circulate in the
Vietnamese market. Goods that are in transit through the
territory of Vietnam shall not be in circulation in the
Vietnamese market. Goods in transit shall enjoy a different
legal framework in comparison with imported goods for
circulation in the market.
Article 242 of the 2005 Commercial Law clearly provides for the right to freedom o f ịransit o f goods of íoreign

organizations and individuals when participating in international trade activities.
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However, paying transit remunerations by using transit goods or illegally consuming goods in transit or means
of transport carrying goods in transit are prohibited by the
Law (Articie 248). Goods in transit shall be permitted for
consumption in Vietnam only when it is so approved in
\vriting by the Trade Minister. The consumption of transit
goods in Vietnam must comply with the provisions of
Vietnamese law on import of goods, taxes, charges, fees
and other rinanciál obligations (Article 247).
The 2005 Commercial Law provides that the maximum duration of goods transit through the Vietnamese
territory shall be thirty days from the date of completion of
cústoms procedures at import border-gates, except vvhere
goods are warehoused in Vietnam or damaged or lost in
the course of transit.
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Key issues in the 2005 Commercial Law

Pursuant to the 2005 Commercial Law, foreign organi*
zations or individuals that wish to transit their goods
through the Vietnamese territory must hire Vietnamese
traders providing transit services to do so, except for cases
where International treaties to vvhich the Socialist Republic
of Vietnam is a contracting party provide otherwise.
Transit Service contracts must be made in writing or
in other forms of equivalent legal validity. Rights and obligations of parties to a transit Service contract shall by
agreed upon by the parties and provided for in detail in

Article 252 and Article 253 of the 2005 Commercial Law.
8. Lease of goods
Provisions on lease of goods are newly supplemented
into the 2005 Commercial Law. The practice of commercial
activities currently shows that lease of goods is a common
phenomenon but were not provided for by law. The Civil
Code embodies only general provisions on contracts for
lease of property and is not adequate to regulate activities
of lease of goods in the market. It is due to a principle in
the Civil Code that the Code only regulates general matters on contracts and speciĩic types of contract shall be provided for by specialized laws.
'
Therefore, the 2005 Commercial Law supplements 15
provisions on lease of goods. These provisions are relatively similar to those in the ưniíorm Commercial Code of the
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Part i. Introduction to the 2005 Commercìal Law

ư s and the Contract Law of China vvhich are considered as
norms in commercial activities.
9. Commercial íranchise
The 2005 Commercial Law provides for commercial
ĩranchise, serving as legal basis for activities of commercial franchise, encouraging such activities to develop and
ensuring legitimate rights and interests of involved parties. Poreign traders are entitled to conduct activities of
commercial íranchise provided that there are provisions
for that in international treaties to which Vietnam is a
party and such activities are allowed by the Trade
Minister (Clause 1 of Article 291).
Provisions on commercial franchise include rights and
obligations of parties to a commercial ĩranchise contract

(ửanchisors and ĩranchisees) (Articles 286 to 289); forms
of commercial franchise contracts (Article 285); sub-franchise to a third party (Article 290) and State management
over commercial franchise (Article 291). The 2005
Commercial Law does not provide for conditions for a
trader to become a franchisor or become a ừanchisee; not
provide for responsibilities to pay damages to a third
party who consumes goods or services subject to commercial franchise contracts. Thereíore, these provisions
should be more detailed to meet requirements emerged
from the practice.
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