The arbitral award means a decision of the arbitration council to settle the entire dispute and terminating the arbitral proceedings. When one of the disputing parties files a petition to cancel the arbitral award, the People’s court shall consider canceling the arbitral award based on the grounds for cancellation of the arbitral award as specified in Article 68 of the Law on Commercial Arbitration 2010 and specifically guided in Article 14 of Resolution No. 01/2014/NQ-HDTP.
Accordingly, the commercial arbitration award included: a decision to recognize the agreement of the parties of the Arbitration council; and the Arbitral Award of the Arbitration council.
Grounds to cancel a commercial arbitration award include:
First, there is no arbitration agreement or invalid arbitration agreement. The invalid Arbitration agreements specified in Article 18 of the 2010 Commercial Arbitration Law include: Disputes arise in the domains falling beyond the arbitration’s jurisdiction; The arbitration agreement maker has no competence or has insufficient civil act capacity; the agreement form is not suitable; the parties establish the arbitration agreement not out of the voluntary will or against the law.
Second, the Arbitration council’s composition or procedures of arbitral proceedings is/are incompliant with the parties’ agreement or the 2010 Commercial Arbitration Law.
For example, The parties agree that the dispute is resolved by an arbitration council consisting of three arbitrators and applying Vietnam’s law to resolve the dispute, but in fact, the dispute resolution is conducted by the Arbitral Council consists of a sole arbitrator, the applicable law is Singapore’s law, although one party has objected but is not accepted by the Arbitration council, this is a serious violation of the proceedings arbitration and is the ground to cancel Arbitral awards.
Third, the dispute falls beyond the arbitration council’s jurisdiction: when an arbitral award contains the details falling beyond the arbitration council’s jurisdiction, such details shall be canceled.
Specifically, this is the case of the arbitration council to settle disputes in the area not under the jurisdiction of the arbitration; or the arbitration council resolves a dispute without the parties agreeing to request arbitration or settling beyond the scope of the agreement to bring to arbitration.
The areas under the jurisdiction of the Arbitration include (i) disputes between parties arising from commercial activities; (ii) disputes arising between parties in which at least one party has commercial activities; (iii) disputes between the parties that are required by law to be resolved by arbitration.
Fourth, the evidence provided by the parties on which the arbitration council bases to issue the award is counterfeit: an arbitrator receives money, assets, or other material benefits from one disputing party, thus affecting the objectivity and impartiality of the award;
Fifth, the award contravenes the fundamental principles of Vietnamese law. This is the case in which the decision violates the basic principles of handling with overarching effect for the formulation and implementation of Vietnamese law. In fact, this is a ground often invoked by the People’s court to cancel the Arbitral award. The scope of this base is relatively wide, so it is easy to get caught when dealing with the Arbitration Council.
For example, The parties voluntarily agree on the settlement of a dispute and this agreement is not against the law, social ethics, but the Arbitration council does not recognize the agreement of the parties in the Arbitral Award. In this case, the Arbitral award violates the principle of free, voluntary commitment in the commercial field specified in Article 11 of the Commercial Law and Article 4 of the Civil Code … The Court shall consider and decide the cancel this Arbitral award because it is contrary to the basic principles of Vietnamese law as stipulated by the Commercial Law and the Civil Code.
The obligation to prove the grounds for canceling the Commercial Arbitral award
In case the arbitral award is contrary to the basic principles of Vietnamese law, the burden of proof rests with the People’s Court. The People’s Court is responsible for proactively verifying and collecting evidence to decide whether to cancel the arbitral award.
For the remaining cases, the burden of proof rests with the party requesting the cancellation of the arbitral award.
The time limit for cancellation of commercial arbitral awards
Not in all cases or any time to time the parties have the right to request cancellation of the arbitral award.
The time limit for the parties to request cancellation of an Arbitral award is within 30 days from the date of receipt of the arbitral award. The parties may request cancellation of the arbitral award beyond 30 days in the event of a force majeure event and the time of the force majeure event is not counted into the time limit for requesting the cancellation of the Arbitral Award.
Within the aforesaid time limit, if one of the parties has sufficient evidence to prove that the arbitration council has issued a decision falling under one of the above-mentioned grounds, it may apply to the competent court to request the cancellation of the arbitral award.
This is the article advising on “Grounds for cancellation of Arbitral awards” by Apra Law Firm. If you have any questions or concerns, please contact the hotline for further advice and support.
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