Disputes on contracts for purchase and sale of goods in Vietnam

Along with the development of the market economy, the goods exchanged are increasingly diversified and abundant. The sale and purchase activities took place actively, leading to an increase in related disputes. So how does Vietnamese law regulate the settlement of disputes on contracts for purchase and sale of goods?

What is a contract for purchase and sale of goods in Vietnam?

The Commercial Law 2005 does not introduce the concept of a contract for purchase and sale of goods. According to the principle of application of the law, the contents not prescribed by the Commercial Law will be applied according to the provisions of the Civil Code. Article 430 of the Civil Code 2015 defines: Sale contract means an agreement between parties whereby a seller is obligated to transfer the ownership rights of property to the purchaser and the purchaser is obligated to make a payment to the seller.

The nature of the goods sale and purchase activity is that the seller transfers the ownership of the goods to the buyer in order to receive money back from the buyer. Thus, a contract for purchase and sale of goods can be defined as an agreement between traders whereby the seller is obliged to deliver the goods, transfer the ownership of the goods to the buyer and receive payment; The buyer is obliged to pay the seller, receive the goods and take ownership of the goods as agreed.

The features of the contract for purchase and sale of goods in Vietnam

The contract for purchase and sale of goods has the following basis features:

The object of contract for purchase and sale of goods is goods.

Commodities are products of human labor for sale and exchange in the market. Commodities include tangible goods, valuable papers, goods to be formed in the future, etc.

The goods in the contract for purchase and sale of goods must be those that are allowed to be circulated on the market, not subject to the cases of circulation restriction and circulation ban as prescribed by law.

Agreements of the parties in a contract for purchase and sale of goods are often diverse and depend on the type of goods.

A contract is an agreement and unification of the will of the contracting parties on the terms of the contract. Commodity trading activities are diverse and complex. Therefore, the agreement of the parties in the contract is also very diverse and depends on the nature of each type of goods.

The nature of a contract for purchase and sale of goods is reflected in the following two main agreements:

– Agreement on delivery obligations and transfer of ownership of goods.

– Agreement on the buyer’s obligation to receive and pay for the goods.

These two agreements are the basis for distinguishing a contract for purchase and sale of goods from other types of contract attached to goods, such as a lease contract, a processing contract, etc.

Types of disputes on contracts for purchase and sale of goods in Vietnam

Disputes arising from the seller’s breach of delivery obligations

– Disputes related to quantity of goods such as under-delivery, non-delivery, delivery without documents or late delivery of documents related to goods, …

– Disputes related to goods quality such as delivery in wrong quality, packing specifications as agreed in the contract, …

– Disputes related to delivery obligations such as delivery of goods not on time and place agreed in the contract, …

The aggrieved party in these cases often has the following requirements:

– Requirement to strictly perform the contract (in case of shortage or poor quality delivery);

– Claim for damages;

– Claim for fines (if there is agreement on fines for violations);

– Claim to terminate or cancel the contract.

Disputes arising from the buyer’s breach of obligations

– Disputes related to breach of payment obligations such as non-payment, insufficient payment, delayed payment or improper payment according to the content agreed in the contract.

– Disputes related to the buyer’s violation of the delivery obligations such as late receipt or non-receipt of goods.

The aggrieved party in these cases often has the following requirements:

– Claim to fulfill the obligation to pay the goods and the interest arising on the amount of late payment;

– Claim for damages;

– Claim for fines (if there is agreement on fines for violations);

– Claim to terminate or cancel the contract.

Vietnamese law on dispute settlement of contracts for purchase and sale of goods.

According to Vietnamese law, a contract for purchase and sale of goods can be a civil contract or a commercial contract, depending on the subject and the purpose of the contract. Accurate identification of the type of contract in order to determine the applicable law to resolve the contract dispute.

The law applicable to dispute settlement is the provisions of law in force at the time the parties sign the contract for purchase and sale of goods. In addition, due to the diversity and complexity of traded goods, when settling disputes, the competent authority will study and prioritize the application of specialized laws governing such goods. If the specialized law does not provide for it, the provisions of the general law shall apply.