I. INTRODUCTION

An effective dispute resolution mechanism is a critical factor for investors when choosing an investment destination. In Vietnam, however, the traditional court system has revealed several shortcomings—particularly in cases involving foreign investors. Lengthy proceedings, procedural rigidity, and inconsistent outcomes have undermined confidence in the system and, by extension, the investment climate.

Recognizing these challenges, the Vietnamese Government has introduced a series of reforms aimed at strengthening the country’s legal infrastructure and enhancing its appeal to global investors. Central to these reforms is the creation of a Specialized Court (Tòa chuyên biệt) at the International Financial Center (“IFC”). Operating in tandem with the International Commercial Arbitration Center (“ICA”), this Specialized Court is envisioned as a dedicated forum for resolving disputes among IFC members, as well as disputes between IFC members and external parties.

This article examines the legal framework underpinning the Specialized Court, highlights recent developments, and considers potential practical challenges. It also offers recommendations to ensure that the Specialized Court fulfills its promise of delivering efficient, predictable, and investor-friendly dispute resolution.

II. KEY DEVELOPMENTS AND POTENTIAL PRACTICAL CHALLENGES OF THE SPECIALIZED COURT LAW

(a) Institutional Design of the Specialized Court

Under Article 4.1 of the Law on the Specialized Court at the International Financial Center (“Specialized Court Law”), the Specialized Court is formally established within Vietnam’s national judiciary, namely the People’s Court (Tòa án Nhân dân). Its mandate is to adjudicate international commercial disputes among IFC members, as well as disputes between IFC members and external parties, in a fair, timely, and lawful manner. The creation of this institution reflects Vietnam’s commitment to safeguarding investors’ rights and fostering a transparent, predictable, and business‑friendly rule‑of‑law environment.

Unlike Dubai – where the Dubai International Financial Centre Court (DIFC Court) operates as a fully independent judicial system outside the national courts – Vietnam’s model integrates the Specialized Court directly into the national judiciary.[1] This approach appears more aligned with the structures of the Singapore International Commercial Court (SICC)[2] and the China International Commercial Court (CICC)[3], both of which function as specialized divisions within their respective national court systems rather than as standalone jurisdictions.

Headquartered in Ho Chi Minh City, the Specialized Court adopts a two‑tier structure comprising a First Instance Court and an Appellate Court. These are supported by dedicated administrative units to ensure streamlined judicial operations.[4] A notable innovation is the finality of appellate judgments: unlike traditional courts, decisions of the Specialized Court’s Appellate Court are not subject to cassation or retrial proceedings (thủ tục giám đốc thẩm, tái thẩm).[5] This procedural design enhances efficiency, shortens dispute resolution timelines, and provides greater predictability for investors – an essential feature for fostering confidence in Vietnam’s investment environment.

(b) Judge Appointments to the Specialized Court

In contrast to traditional courts – where judges are typically trained, promoted, and appointed from within the domestic judiciary – the Specialized Court adopts a more expansive and globally oriented appointment framework. Judicial positions are open not only to judges from the People’s Court system, but also to foreign legal experts, experienced practitioners, and distinguished Vietnamese lawyers, academics, and scholars.[6] This marks a significant departure from conventional recruitment practices and reflects the State’s determination to ensure that the Specialized Court is equipped to address the complex, cross‑border commercial disputes anticipated within the IFC. By welcoming candidates from diverse professional and jurisdictional backgrounds, the system encourages the participation of highly qualified legal minds, thereby enhancing the quality, credibility, and efficiency of adjudication.

To be appointed, however, candidates must satisfy rigorous eligibility standards. These include, inter alia: A minimum of 10 years of adjudicatory or relevant legal experience, and proficiency in English, acknowledging that proceedings may involve foreign parties and international commercial law.[7] These elevated criteria demonstrate Vietnam’s commitment to building a Specialized Court that is not only aligned with international best practices but also capable of delivering reliable and sophisticated judicial services within an increasingly globalized commercial environment.

Judges of the Specialized Court are appointed by the State President upon the recommendation of the Chief Justice of the Supreme People’s Court. Each appointment is for a renewable five‑year term.[8] This process balances institutional oversight with judicial independence, while the fixed term structure allows for periodic renewal of expertise and ensures that the Court remains responsive to evolving international commercial dynamics.

As the Specialized Court has only recently been established, no foreign judge has been appointed to date. Accordingly, it remains to be seen how the appointment framework for foreign judges will be implemented in practice and how foreign judicial participation will contribute to the Court’s development and operation.

(c) Jurisdiction of the Specialized Court

Core Jurisdictional Scope

Under Article 13 of the Specialized Court Law, the Specialized Court has jurisdiction over investment and business‑related disputes, including the recognition and enforcement of foreign arbitral awards, arising between IFC members, as well as disputes between an IFC member and external parties. This jurisdictional scope reflects the core purpose of the Specialized Court – to serve as the primary judicial forum for IFC‑related commercial activities and cross‑border business transactions.

Exclusions for Public and State Interests

However, the disputes involving public interests or the State’s interests (lợi ích công cộng, lợi ích của Nhà nước) fall outside the Specialized Court’s jurisdiction. A key challenge, however, lies in the lack of precise definitions for these concepts, which risks broad or inconsistent interpretation. Such ambiguity could undermine predictability and potentially restrict the Court’s jurisdiction more than intended.

Article 3.2 of Resolution 205/2025/QH15 (“Resolution 205”), which pilots the authorization for the People’s Procuracy to initiate civil actions to protect vulnerable groups and public interests, provides partial clarification. It defines “public interests” to include community and State interests in areas such as public investments, land, natural resources, public assets, environmental protection, ecosystems, cultural heritage, food safety, pharmaceuticals, and consumer rights. While this elaboration is helpful, the concept remains broad, leaving room for uncertainty and inconsistent judicial practice, which could inadvertently narrow the Specialized Court’s jurisdiction beyond what the legislature intended.

Absence of Opt‑In Jurisdiction

Unlike the DIFC Courts[9], the Singapore International Commercial Court (SICC)[10], and the China International Commercial Court (CICC)[11] – all of which allow opt‑in jurisdiction where disputing parties may, by agreement, submit their disputes to those courts – the Specialized Court Law does not provide jurisdiction over disputes solely on the basis of party consent. Its jurisdiction is expressly limited to disputes connected to the IFC, consistent with its foundational purpose.[12]

However, given that the Specialized Court benefits from preferential procedural policies, and is expected to operate with international standards, Vietnam may consider future reforms to introduce an opt‑in mechanism. Such an expansion would align Vietnam with other leading international commercial courts and bolster its competitiveness as a regional hub for cross‑border dispute resolution. Allowing opt‑in jurisdiction would also enhance the Court’s attractiveness to foreign investors seeking neutral, sophisticated, and internationally oriented judicial forums.

(d) Applicable Law

Procedural Framework

Article 6.1 of the Specialized Court Law stipulates that proceedings before the Specialized Court are governed by the Law itself and its procedural rules. Although these rules have been drafted but not yet officially published[13], the current provisions already signal a flexible procedural framework that embraces the principle of party autonomy. This design aims to enhance efficiency and responsiveness in dispute resolution, distinguishing the Specialized Court from Vietnam’s more rigid traditional judicial processes.

Substantive Law Choices

For transactions involving at least one foreign party, the parties may select Vietnamese law, foreign law, or international commercial trade usages as the governing law. An exception applies to disputes concerning ownership rights, leases, or the use of real estate as security, where the law of the country in which the property is located must apply.[14] In the absence of an agreement, the law of the country most closely connected to the dispute governs. For transactions solely between Vietnamese parties, Vietnamese law applies.[15] Importantly, Article 6.3 prohibits the application of foreign law or international commercial usages if doing so would contravene Vietnam’s “public order” (trật tự công).

However, the above regulations raise several issues for practical application as below: 

Restrictive Choice of Law

Article 6.2 of the Specialized Court Law permits parties to choose foreign governing law only if at least one party is a foreign individual or organization. This is narrower than the 2015 Civil Code, which allows foreign law in any civil transaction with a foreign element (e.g., when the subject matter is abroad or the relationship is formed abroad). It also appears inconsistent with the 2025 Investment Law (and previously the 2020 Investment Law), which permit foreign‑invested organizations – not only foreign investors – to choose foreign law when they meet certain criteria, such as having more than 50% foreign ownership.[16] As a result, the Specialized Court Law is more restrictive than existing general laws, potentially limiting party autonomy.

Ambiguity in Real Estate Disputes

Article 6.2 mandates application of the lex situs (law of the property’s location) for disputes “relating to ownership rights and other rights over real estate, real estate leases, or the use of real estate as security.” However, the law does not clearly define the scope of such disputes. For example, if a dispute arises over a share transfer in a real estate company, does this qualify as a dispute “relating to rights over real estate”? The lack of clarity risks inconsistent application and may exclude parties from choosing foreign governing law in cases where the connection to real estate is indirect.

Terminological Inconsistencies (“Public Order” vs. “Fundamental Principles”)

• Resolution 222 prohibits foreign law if it violates the “fundamental principles of Vietnamese law,” while the Specialized Court Law excludes foreign law and international trade usages if they violate “public order”. [17] Whether these terms are synonymous is unclear. Moreover, Resolution 222 addresses only foreign law, whereas the Specialized Court Law extends the prohibition to international commercial usages. This overlap creates uncertainty about which standard prevails in case of conflict, raising the risk of inconsistent judicial interpretation.
• Without harmonized guidance, these inconsistencies may lead to overlapping or contradictory applications of substantive rules. Such unpredictability undermines investor confidence and could discourage parties from selecting the Specialized Court as their preferred forum

In short, the absence of clear, consistent rules on applicable substantive law—particularly regarding the scope of real estate disputes, the meaning of “public order,” and the relationship between different legislative instruments – creates uncertainty. Unless clarified, these ambiguities may weaken the Specialized Court’s credibility and deter foreign investors from relying on it for dispute resolution.

(e) Statute of Limitation

Pursuant to Article 18 of the Specialized Court Law, unless otherwise provided by the laws governing investment and business matters in the IFC, or unless the parties agree to different terms, the statute of limitations shall be applied as follows:

• Six (06) years from the date on which the event giving rise to the proceedings occurs in cases involving: (i) investment or business disputes among IFC members, or between IFC members and other parties and (ii) Requests for recognition and enforcement in Vietnam of a foreign court judgment or foreign arbitral award resolving disputes among IFC members or between IFC members and other parties[18];
• For requests relating to arbitration proceedings between IFC members or between IFC members and other parties, the statute of limitations shall be determined in accordance with the Law on Commercial Arbitration[19].

Compared with the 2015 Civil Code and the 2005 Commercial Law, the Specialized Court Law introduces two notable changes: First, the statutory limitation period is extended to six years, compared to three years and two years under the aforementioned laws respectively. Second, the parties are expressly permitted to agree on the statute of limitations, including the possibility of extending or shortening it.

Despite these advancements, the regulation presents potential practical challenges:

• Uncertainty of precedence: It remains unclear whether a party agreement on the statute of limitations would prevail over the statutory provisions governing investment and business matters in the IFC, in cases where the two conflict.
• Scope of application: Ambiguity persists regarding how the statute of limitations should be determined for other cases involving business or investment activities in the IFC as referenced in Article 13.1(d) of the Specialized Court Law.
• Commencement date: Under the 2015 Civil Code and the 2005 Commercial Law, the statute of limitations in Vietnamese law commences: (i) on the date when the entitled person knows, or ought reasonably to have known, that their lawful rights and interests have been infringed[20]; or (ii) on the date when the infringement actually occurs[21]. However, the Specialized Court Law stipulates that the commencement date is the date on which the event giving rise to the proceedings occurs. However, this formulation raises interpretive challenges. Specifically, it remains unclear how such an “event” is to be determined in practice – particularly in cases involving multiple violations or a series of interconnected events leading to the proceedings. This ambiguity could create uncertainty for parties seeking to calculate limitation periods and may complicate judicial application of the rule.

(f) Evidences

The Specialized Court Law introduces new regulations on evidence that closely align with international standards. Key developments include:

• Party-driven evidence collection: Unlike the traditional courts where the courts are obligated to collect the evidences in certain cases, according to the Specialized Court Law, the Specialized Court shall not proactively collect evidence unless specifically requested by the parties[22]. This approach reflects international practice and parallels recent reforms in the Vietnamese People’s Courts.
• Mandatory disclosure: Any documents submitted to the Specialized Court must be simultaneously served on the counterparty. Failure to do so renders the evidence inadmissible.[23] This rule, mirroring international standards on production requests, prevents concealment of evidence, streamlines proceedings, and enables judges to focus squarely on the merits of the case.
• Expert evidence: The parties are expressly granted the right to present expert evidence.[24] This innovation, recognized under the Specialized Court Law, is comparable to provisions in the Law on Commercial Arbitration 2010 and in common law jurisdictions. It is particularly valuable in cases involving the application of foreign laws, where specialized expertise may be essential.

(g) Default and Summary Judgement

Prior to the enactment of the Specialized Court Law, Vietnamese legislation neither regulated nor recognized the concepts of default judgment – a judgment issued in favor of one party due to the opposing party’s failure to take required procedural action – nor summary judgment – a judgment rendered without a full trial when the court determines that no genuine dispute of material fact exists and one party is entitled to judgment as a matter of law.

For the first time, these concepts have been formally adopted under the Specialized Court framework. Specifically, Article 23.1 provides that, at the claimant’s request, the Specialized Court may issue a default judgment where the defendant has been properly served with the statement of claim and accompanying documents, but the defendant fails to submit either a written confirmation of receipt or a written response within the prescribed time limit, absent a “legitimate reason” (lý do chính đáng) for such failure.

Similarly, a summary judgment may be issued when the following conditions are fully satisfied: (i) the claimant is unable to substantiate their claims, or the defendant is unable to refute them; and (ii) the Court determines that there are no “reasonable or convincing grounds” (không có lý do, căn cứ thuyết phục) to proceed to trial.[25]

The adoption of default and summary judgment brings Vietnam’s Specialized Court closer to common law practices, enhancing predictability and efficiency for foreign investors.

These mechanisms may significantly reduce case backlogs and litigation costs in the IFC, but their success will depend on consistent judicial application and clear procedural guidance. The application of these regulations, however, may face the following key challenges: First, the law does not specify which circumstances qualify as legitimate reasons for failing to respond, leaving courts with broad discretion that could lead to inconsistent outcomes in terms of the issuance of default judgement. Second, it is uncertain how strictly courts will apply the “reasonable or convincing grounds” (không có lý do, căn cứ thuyết phục) test for summary judgment remains to be seen. Third, lawyers and litigants accustomed to full hearings may need to adjust strategies, particularly in evidentiary preparation.

In short, Vietnam’s Specialized Court Law marks a historic procedural shift, importing tools long central to common law litigation into a civil law environment. This hybridization could reshape litigation culture in the Specialized Court, but its practical success will hinge on judicial interpretation and practitioner adaptation.

(h) Judgement Enforcement

Traditionally, enforcement of legally effective judgments in Vietnam has been the responsibility of the civil judgment enforcement agencies, as regulated under the Law on Civil Judgment Enforcement 2008 (soon to be replaced by the 2025 Law).

By contrast, the Specialized Court Law introduces a significant departure: The court itself now has jurisdiction to render enforcement decisions. Judges are empowered to directly conduct enforcement steps.[26]

This reform aims to streamline enforcement, reduce bureaucratic delays, and ensure efficiency in dispute resolution. However, the implementation of this new approach may be quite challenging in practice as the enforcement requires substantial human resources and practical expertise and it may take time for courts to build the necessary capacity, and the effectiveness of this new approach will depend on training, infrastructure, and coordination with existing enforcement agencies.

(i) Other Notable Changes

Addition to the above changes, the Specialized Court Law also adopt other notable following changes:

• Mandatory Legal Representation: Claimants or respondents that are legal entities must be represented by a lawyer, unless otherwise provided by the Rules on Proceedings.[27] This requirement elevates the professionalism of proceedings and aligns with international standards, where corporate parties are generally represented by counsel.
• Recoverability of legal fees: Unlike traditional Vietnamese court practice – where legal fees are generally non-recoverable (except under limited provisions such as the 2005 Intellectual Property Law) – the Specialized Court Law allows the winning party to recover reasonable proceeding fees, including legal fees, unless the parties agree otherwise.[28] This change incentivizes efficiency and discourages frivolous litigation, aligning Vietnam with practices in arbitration and common law jurisdictions.
• Finality of the appeal judgement: Unlike traditional courts, decisions of the Specialized Court’s Appellate Court are not subject to cassation or retrial proceedings (thủ tục giám đốc thẩm, tái thẩm).[29]

III. CONCLUSION

The establishment of the Specialized Court marks a watershed moment in Vietnam’s judicial reform, introducing mechanisms and procedures that bring the country’s dispute resolution framework closer to international standards. From the recognition of default and summary judgments, to enhanced evidentiary rules, streamlined enforcement, and recoverability of legal fees, these innovations promise greater efficiency, predictability, and alignment with global best practices.

Yet, the transition is not without challenges. Questions remain regarding the interpretation of statutes of limitation, the practical capacity of courts to directly enforce judgments, and the cultural shift required for litigants and practitioners accustomed to traditional procedures. The success of the Specialized Court will ultimately depend on how these reforms are implemented in practice – whether judges, lawyers, and enforcement bodies can adapt swiftly and consistently to the new framework.

In sum, while the Specialized Court Law represents a bold step forward in modernizing Vietnam’s judicial system, its true impact will be measured by its ability to balance innovation with clarity, efficiency with fairness, and international harmonization with domestic legal traditions. If these goals are achieved, the Specialized Court could become a cornerstone institution that strengthens investor confidence and elevates Vietnam’s role in the global legal landscape.

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References:

[1] Dubai Int’l Fin. Ctr. Courts, About DIFC Courts, DIFC Courts, https://www.difccourts.ae/about/difc-courts (last visited Feb. 25, 2026).

[2] Singapore Int’l Commercial Ct., Singapore International Commercial Court, Supreme Court of Singapore, https://www.judiciary.gov.sg/singapore-international-commercial-court (last visited Feb. 25, 2026).

[3] China Int’l Commercial Ct., A Brief Introduction of China International Commercial Court, Supreme People’s Court of China, https://cicc.court.gov.cn/html/1/219/193/195/index.html (last visited Feb. 25, 2026).

[4] Specialized Court Law No. 150/2025/QH15, art. 7 (Viet.).

[5] Id. art. 35.4.

[6] Id. arts. 10.2 and 10.3.

[7] Id. arts. 10.2 and 10.3.

[8] Id. art. 10.4.

[9] Dubai International Financial Centre Courts Law No. 2 of 2025, art. 14(B).

[10] Singapore Supreme Court of Judicature Act 1969, art. 18(F).

[11] Provisions of the Supreme People’s Court on Several Issues Regarding the Establishment of the International Commercial Court, art. 2.

[12] Supreme People’s Court, Proposal for the Draft Law on Specialized Courts at the International Financial Center, at 2 (2025).

[13] Dự thảo Quy tắc Tố tụng của Tòa án Chuyên biệt tại Trung tâm Tài chính Quốc tế [Draft Procedural Rules of the Specialized Court at the International Financial Center], Academia.edu (2025), https://bit.ly/DựthảoQUYTẮCTỐTỤNGCỦATÒAÁNCHUYÊNBIỆTTẠITRUNGTÂMTÀICHÍNHQUỐCTẾ.

[14] Id. arts. 6.2(a), 6.2(c).; Resolution No. 222/2025/QH15, art. 6.1 (Viet.).

[15] Id. art. 6.2(b).

[16] Investment Law, No. 61/2020/QH14, art. 4(5), art. 23 (Viet.); and Investment Law, No. 143/2025/QH15, arts. 4.6 and 20.1 (Viet.).

[17] Resolution No. 222/2025/QH15, art 6.2(a) and Specialized Court Law, art. 6(3) (Viet.).

[18] Specialized Court Law, art. 18(1) (Viet.).

[19] Specialized Court Law, art. 18(2) (Viet.).

[20] Civil Code (2015), art. 154(1) (Viet.).

[21] Commercial Law (2005), art. 319 (Viet.).

[22] Specialized Court Law, art. 20(3) (Viet.).

[23] Id. art. 20.3(b).

[24] Id. art. 26.

[25] Id. art. 23.2.

[26] Id. art. 38.

[27] Id. art. 19.2.

[28] Id. art. 20.

[29] Id. art. 35.4.