A. Summary
The draft amendment to the Law on the Organization of the People’s Courts has undergone the 6th draft revision on 10 April 2025 (the “6th draft Amended Law”). It is currently being reviewed by the National Assembly of Vietnam. One of the most notable proposed changes is the reallocation of jurisdiction to set aside foreign court judgments and foreign arbitral awards from the provincial-level People’s Courts to the newly established Regional People’s Courts (in Vietnamese: Tòa án Nhân dân khu vực). This development could have significant procedural and strategic implications for parties involved in cross-border litigation and arbitration in Vietnam.
B. Key Proposed Change
Currently, applications for recognition, enforcement, or for setting aside foreign court judgments and foreign arbitral awards are generally handled by the People’s Courts of the provinces and the centrally run cities (the Code of Civil Procedure 2015, Articles 31.1 and 37.1). However, under the 6th draft Amended Law:
- Jurisdiction over the arbitration activities prescribed in Article 7.3 of the Law on Commercial Arbitration, which includes the jurisdiction over requests for setting aside a foreign arbitral award, would be transferred to from People’s Courts of the provinces and the centrally run cities to the newly proposed Regional People’s Courts (Article 2.1).
- The Regional People’s Courts are established as a new level of adjudication between the Supreme People’s Court and the provincial-level People’s Courts, with broader authority over complex or significant legal matters, particularly those with cross-border elements (Article 1.11).
C. Implications
The proposed change aims to improve the quality and consistency of judicial decision-making, particularly in the recognition and annulment of foreign arbitral awards—a critical issue for Vietnam’s attractiveness as an arbitration-friendly jurisdiction. However, this may result in potential delays or the reallocation of cases, specifically, existing or pending cases filed at provincial courts may face jurisdictional reassessment once the amended law is enacted.
On 7 May 2025, a representative of the Vietnam International Arbitration Center (“VIAC”) submitted an official letter to the Chief Justice of the Supreme People’s Court, expressing concerns over the potential impacts of the proposed changes in the 6th draft Amended Law, particularly regarding the decentralization of arbitration oversight in Vietnam. In the letter, VIAC proposed that the authority to supervise arbitration-related activities should remain with the provincial-level People’s Courts.
D. Next Steps
The 6th draft Amended Law is expected to be submitted to the National Assembly for consideration and adoption at the 9th session. The 9th session started on 5 May 2025 and is expected to conclude no later than 30 June 2025.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.
