Want to be in the loop?
subscribe to
our notification
Business News
CONTRACTS IN VIETNAM THAT DENOMINATE PAYMENT IN FOREIGN CURRENCY ARE VOID UNDER VIETNAMESE LAW
This is not new law but parties often ignore this to their detriment when a dispute occurs.
Regardless of the substance of the underlying dispute, the denomination of payment terms in foreign currency is the easiest way for one party to seek to get out of a contract by asking the court to void such arrangement.
There have been some cases where the courts have voided contracts for deposits denominated in USD for house/condo purchases and the sellers had to return funds to the purchasers. Note that such contracts are still void even if payments were in fact made in VND.
This is particularly detrimental to service providers because once services are rendered, returning to the original position is impossible.
Note also that under the law, the person who makes the illegal foreign currency payment may be subjected to a fine between VND 200 - 250 million and any amount paid may be confiscated. To date the State Bank of Vietnam has not yet enforce strictly these penalty provisions but it is only a matter of time.
DN Legal, 7 March 2016 (www.daonguyenlegal.com)
Related News
2024: VIETNAM'S OUTBOUND INVESTMENT RISES BY 57.7%
In 2024, Vietnamese investors launched 164 new projects and made 26 capital adjustments abroad. Vietnam’s total oversea investment rea…
VIETNAM’S RIDE-HAILING MARKET ATTRACTS GLOBAL AND LOCAL COMPETITION
As European unicorn Bolt explores a potential entry into Vietnam’s ride-hailing sector, the market is undergoing significant shifts, with loca…
GREEN MOMENTUM LIKELY TO PERSIST ON VIỆT NAM'S STOCK MARKET
Việt Nam’s stock market staged a strong rebound last week, recovering after two weeks of consecutive declines that had wiped more than…
DIGITAL TRANSFORMATION CATALYST FOR COMPREHENSIVE DEVELOPMENT
Vietnam is entering a period of strong transformation, led by the ongoing digital transformation revolution. The rapid booming o…
INVESTMENT OPPORTUNITIES SEEN IN VIỆT NAM'S POWER STOCKS
The Government's focus on achieving a GDP growth rate between 6.5 per cent and 7.5 per cent in 2025 underscores the critical role of ele…
VIETNAM ECONOMIC NEWS RECAP - DECEMBER 2024
As we conclude the year 2024, it is important to recognize the complex landscape Vietnam navigated throughout the year. Despite facing si…
2024: VIETNAM'S OUTBOUND INVESTMENT RISES BY 57.7%
In 2024, Vietnamese investors launched 164 new projects and made 26 capital adjustments abroad. Vietnam’s total oversea investment rea…
VIETNAM’S RIDE-HAILING MARKET ATTRACTS GLOBAL AND LOCAL COMPETITION
As European unicorn Bolt explores a potential entry into Vietnam’s ride-hailing sector, the market is undergoing significant shifts, with loca…
GREEN MOMENTUM LIKELY TO PERSIST ON VIỆT NAM'S STOCK MARKET
Việt Nam’s stock market staged a strong rebound last week, recovering after two weeks of consecutive declines that had wiped more than…
DIGITAL TRANSFORMATION CATALYST FOR COMPREHENSIVE DEVELOPMENT
Vietnam is entering a period of strong transformation, led by the ongoing digital transformation revolution. The rapid booming o…
INVESTMENT OPPORTUNITIES SEEN IN VIỆT NAM'S POWER STOCKS
The Government's focus on achieving a GDP growth rate between 6.5 per cent and 7.5 per cent in 2025 underscores the critical role of ele…
VIETNAM ECONOMIC NEWS RECAP - DECEMBER 2024
As we conclude the year 2024, it is important to recognize the complex landscape Vietnam navigated throughout the year. Despite facing si…