BizCLIR

An effective commercial legal and institutional environment requires a system that quickly and fairly adjudicates disputes between parties as inexpensively as possible.

Vietnam presents an interesting situation, in that businesses have traditionally shunned courts and have sought other ways of settling disputes. Nonetheless, Vietnam has a comprehensive court system, and as Vietnam expands its economy, attracts foreign investors, and becomes more integrated into international commerce and trade, the courts are becoming increasingly important.

Vietnam has also been expanding and “modernizing” its system of alternative dispute resolution (ADR). ADR, while it does not replace the courts, provides another venue for the resolution of disputes and offers alternatives for parties to settle their disputes.

This Diagnostic revealed near-universal consensus that the court system is held in generally low esteem by the business community and the general public, that it is viewed as not always providing the fairest of results dispensed with the greatest impartiality and independence, and that major reforms are needed to help ameliorate these major deficiencies.

On the other hand, ADR was viewed as making progress, although haltingly, and that with certain changes it could increase its acceptance by the business and legal communities. Increased use of ADR has, in other countries, spurred the courts to improve.