Business disputes are inevitable during the business investment process. Choosing the appropriate method for resolving business disputes can make parties of the dispute eliminate the bottlenecks of business resources and collect them on other business investment activities. There is no method of resolving business disputes called the best that can be used for all kinds of business disputes. In a particular situation of business disputes, the parties can select one or more the method of resolving business disputes to solve disputes in business activities. The current method of resolving business disputes under the law is as follows:
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Method of resolving business disputes through negotiation between the parties
The method of resolving business disputes through negotiation between parties should be the preferred method for resolving business disputes. It is back-and-forth communication between the parties of the dispute to find themselves a solution of the conflict.
The advantages of the method of resolving business disputes through negotiation between parties are: simple, quick, inexpensive, flexible and flexible process; to keep the reputation and business secrets of the parties; negotiation agreement can become a new contract and be enforceable.
The disadvantages of the method of resolving business disputes through negotiation between the parties is the success in resolving the dispute and the implementation of the negotiation results depend on the willingness, goodwill and cooperation of the parties.
It should be noted about the statute of limitations for instituting a lawsuit when conducting negotiations. If the negotiation is prolonged, the lack of interest in the statute of limitations for initiating a lawsuit may cause the aggrieved party to lose his right to require the judicial bodies to protect his legitimate rights and interests.
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Method of resolving business disputes through commercial mediation
The method of business dispute resolution through commercial mediation is a method of resolving business disputes conducted by agreement of the parties of the dispute and supported by a commercial mediator acting as mediator in accordance with the provisions of Decree 22/2017 / ND-CP dated 24/02/2017 of the Government on commercial mediation.
In order to implement a method of resolving business disputes by a commercial mediator, the parties of the business dispute need an agreement of resolving the dispute by mediation. A mediation agreement may be made before, after or during a dispute, and may be established in the form of a mediation clause in a contract or in the form of a separate agreement.
The advantage of the method of resolving business disputes through commercial mediation is that one of the parties of the dispute has the right to request the Court to acknowledge the successful outcome in mediation. The Court’s decision of acknowledgement of the successful outcome in mediation takes effect immediately, without being appealed or protested according to appellate procedures, and is guaranteed to be enforced in accordance with the law on civil judgment enforcement. In addition, the commercial mediation keeps the reputations and business secrets of the parties.
The limitation of the method of resolving business disputes through commercial mediation is that when the parties fail to reach mutual agreement in commercial mediation and take the dispute to Court and the Court considers the contents and documents that the parties have shown in the commercial mediation process, are the acceptable evidence in Court, the unfavourable content and documents in the commercial mediation process can be used against a party.
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Method of resolving business disputes in commercial arbitration
The method of resolving business disputes at commercial arbitration is a method of resolving business disputes conducted by agreement of the parties of the dispute and proceeded according to the commercial arbitration order and procedures. The person who gives the award for the dispute is the arbitrator. Unlike a judge, the arbitrator is not required to have a professional legal degree, but the arbitrator must have a university degree and have actually worked in the field of study for 5 years or more or be an expert with high professional qualifications and practical experience. Like a trial, only one side will prevail. Unlike a trial, appeal rights are limited.
Disputes are resolved by commercial arbitration if the parties have an arbitration agreement. An arbitration agreement can be established either before or after a dispute occurs. An arbitration agreement can be established in the form of an arbitration clause in a contract or in the form of a separate agreement but must be established in writing.
Disputes under the arbitration’s jurisdiction are disputes related to commercial activities or disputes settled by law according to the law.
The advantage of the method of resolving business disputes in commercial arbitration is that the arbitral award is recognized internationally; The arbitration body is completely neutral and highly qualified arbitrators; ensuring confidentiality business, reputation of the parties.
The disadvantage of the method of resolving business disputes in commercial arbitration is that since there is only one level of settlement, the arbitrator’s award may be inaccurate; the cost of resolving business disputes by arbitration is quite large, not suitable for small and medium enterprises.
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Method of resolving business disputes in Court
Business disputes are resolved by the Court without the parties’ agreement on how to resolve business disputes, except that the parties have an agreement on business dispute resolution through commercial arbitration.
The advantage of the method of resolving business disputes in Court is that the parties have the opportunity to appeal against the first-instance judgment, cassation or reopening the case if there is evidence to illustrate the Court has not resolved the dispute accurately and in accordance with the law; the effective court judgment applies strongly to State agencies, related organizations and individuals in Vietnam.
The disadvantage of the method of resolving business disputes in Court is that the parties must strictly abide by the provisions of the formality of the proceedings; The public trial in Court may affect the credibility or trade secrets of the parties; The case can be prolonged, the trial will be repeated again, causing the disputing parties to spend a lot of time and effort pursuing the case.
If you have difficulties with related matter of the method of resolving business disputes, please contact us: Phuoc & Partners is a professional consulting firm established in Vietnam and currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Danang. Phuoc & Partners is also rated as one of the leading consulting firms specializing in business law in Vietnam that has leading practice areas in the legal market such as Labour and Employment, Taxation, Merger and acquisition, Litigation. We are confident in providing customers with optimal and effective service.
