Exploring the Vietnam International Financial Center: Part 2 – Legal Framework, Dispute Resolution, and Judicial Mechanisms

The second part of the “Exploring the Vietnam International Financial Center series” series focuses on the Vietnam IFC legal framework. Anchored by Resolution No. 222/2025/QH15, it outlines how the IFC enables greater flexibility in applicable law and dispute settlement, strengthening legal certainty and enforceability for cross-border investors.

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The Vietnam IFC features a distinctive legal and dispute resolution system designed to facilitate cross-border investments and business operations. These activities are primarily governed by Resolution 222 and its related regulations, with Vietnam’s national laws providing additional guidance where needed.

The framework permits parties to utilize foreign law in international dealings and select dispute resolution methods, such as arbitration or courts, including the IFC’s International Arbitration Center (IAC) and a specialized court. This setup improves legal clarity and security for investors.

See also: Vietnam International Financial Center Part 1: Regulatory Framework

Vietnam IFC legal framework

Governing legal framework

Investment and business activities within the International Financial Center (IFC) are governed by Resolution 222 and its implementing and guiding regulations. When these directives lack specific provisions, Vietnam’s other existing laws take precedence.

Application of foreign law

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For transactions involving at least one foreign entity, the parties may agree to apply foreign law to such transactions. This flexibility is subject to an important limitation: foreign law may not be applied if doing so would contravene the fundamental principles of Vietnamese law.

If there is no agreement on which law applies, the law of the country most closely connected to the transaction shall govern. For transactions involving ownership rights, other real estate interests, leases, or using real estate as collateral, the law of the location where the property is situated shall apply.

Principles for the application of laws

The priority of applicable laws follows this order:

• Resolution 222 and its guiding legal documents take precedence over other laws or National Assembly resolutions where overlapping provisions exist.
• IFC members may choose to apply more favorable mechanisms or incentives introduced under laws or resolutions enacted after the Resolution.
• Where Vietnam is a party to an international treaty that contains provisions differing from those of the Resolution, the treaty provisions will prevail.

Dispute resolution in investment and business activities

Resolution 222 allows investors, members, and other relevant parties to adopt flexible dispute resolution mechanisms for investment and business activities, provided such mechanisms are consistent with Vietnamese law and based on the parties’ agreement.

Under Article 30 of the resolution, parties may first rely on dispute resolution methods generally permitted under Vietnamese law. In addition, disputes arising either between members or between a member and an investor located outside the IFC may be resolved through one of the following institutions, as agreed by the parties, including:

• Foreign arbitration or international arbitration;
• The International Arbitration Center (IAC) established within the IFC;
• Vietnamese arbitration institutions; and
• Foreign courts or Vietnamese courts.

IFC’s International Arbitration Center

Building on Articles 9 and 30 of Resolution 222, Decree No. 328/2025/ND-CP is the key directive that establishes the legal framework for the IAC’s formation, operation, and jurisdiction within the IFC.

Establishment

Under Decree 328, the IAC can be established with Minister of Justice approval if at least five qualified members submit a valid application as per decree conditions. Located within the IFC in Ho Chi Minh City, it operates independently with its own seal and bank account, enjoying autonomy in organizational and financial matters.

Operational principles

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The IAC operates in line with:

• Vietnam’s commercial arbitration legislation;
• Resolution 222; and
• The provisions of Decree 328.

Its rights and obligations are governed by the general legal framework applicable to commercial arbitration institutions.

Finality and enforcement of arbitrations

Where parties agree to resolve disputes at the IAC, they may further agree in writing to waive their right to request a court to set aside a decision recognising a settlement or an arbitral award issued by the centre’s arbitral tribunal. In such cases, Vietnamese courts will not accept or consider applications to annul these decisions or awards.

Such a waiver is deemed an integral part of the arbitration agreement under Vietnam’s commercial arbitration law. However, courts will still have jurisdiction to review annulment requests in limited circumstances, including where:

• The waiver agreement is invalid under the Commercial Arbitration Law; or
• The waiver is concluded after one party has already filed an application with the court to set aside the arbitral award or decision.

Jurisdiction

The IAC can resolve disputes related to investment and business activities within the IFC if they fall within the scope of the arbitration agreement and comply with the centre’s procedural rules.

However, the centre does not have the authority to resolve disputes involving:

• Administrative decisions or administrative acts of state authorities or competent officials;
• Labour-related disputes;
• Disputes concerning personal rights of individuals; or
• Other matters related to state management that have already been resolved by competent state authorities or Vietnamese courts.

Specialized court at Vietnam’s IFC

Effective from January 1, 2026, the Law on the Specialized Court at the IFC introduces a dedicated judicial mechanism to support investment and business activities within Vietnam’s IFC. The law is a key pillar of the IFC framework and is intended to strengthen legal certainty, enforceability, and investor confidence, particularly for cross-border transactions.

Purpose and regulatory significance

The specialized court aims to manage complex international financial disputes, adopting global commercial court procedures. This demonstrates Vietnam’s commitment to efficient dispute resolution and aligning its judiciary with international standards.

For investors, it offers reassurance that IFC-related disputes will be handled by a forum with expertise and an international outlook.

Location and operational model

The specialized court will be established in Ho Chi Minh City and operate within Vietnam’s people’s court system. However, it will benefit from a more flexible organizational and procedural framework compared to ordinary courts, allowing it to better accommodate complex investment and commercial disputes, including those involving foreign parties.

Jurisdiction and scope of authority

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The specialized court has jurisdiction over:

• Investment and business disputes among IFC members, or between IFC members and non-member entities or individuals;
• Requests for recognition and enforcement in Vietnam of foreign court judgments and foreign arbitral awards related to IFC activities;
• Court-related matters arising from arbitration proceedings involving IFC members; and
• Other investment- and business-related matters connected to the IFC, as determined by the Supreme People’s Court.

In the event of a jurisdictional conflict with other Vietnamese courts, the specialized court will make the initial determination, subject to final review by the Supreme People’s Court.

Judges and international orientation

To enhance credibility and neutrality, the law allows for the appointment of both Vietnamese and foreign judges. Judges must meet strict standards relating to professional qualifications, experience in investment and business disputes, and English proficiency. This approach is intended to align judicial expertise with the needs of international investors.

Key procedural features

Cases at first instance are generally heard by a single judge, with the option to appoint a three-judge panel for complex matters. Appeals are heard by a three-judge panel, and appellate decisions are final, with no cassation or reopening procedures, providing faster resolution and greater predictability.

The law also promotes extensive use of electronic procedures, including e-filing, electronic hearings, and digital submission of evidence and court fees.

Takeaway

Resolution 222 establishes the main legal basis for investment and business activities within Vietnam’s IFC, overriding conflicting domestic laws. The framework permits parties to apply foreign law to transactions involving foreign elements, while respecting Vietnam’s core legal principles, thereby increasing contractual flexibility while maintaining regulatory oversight.

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