I. Setting aside of arbitral awards and judicial jurisdiction

In the context of deep international economic integration, commercial arbitration has increasingly been recognized as an effective dispute resolution method due to its flexibility, confidentiality, and reduced administrative procedures. However, in order to ensure the legality and consistency of arbitral adjudication, judicial supervision of arbitration plays an essential role, particularly in reviewing petitions for setting aside of arbitral awards.

To clearly define the competent authority for such supervisory functions, Resolution No. 81/2025/UBTVQH15 (hereinafter "Resolution 81/2025") of the Standing Committee of the National Assembly, effective from July 1, 2025, officially designates Provincial People’s Courts as the competent courts to adjudicate requests for setting aside of arbitral awards. Nationwide, only three Provincial People’s Courts have this jurisdiction. Previously, this authority was also vested in Provincial People’s Courts where the arbitral tribunal rendered its award, thereby granting such jurisdiction to all Provincial People’s Courts.

During the drafting process, on May 27, 2025, the Standing Committee of the National Assembly (SCNA) proposed a draft model of a three-tier court system—introducing the Regional People’s Courts — assigning them jurisdiction over setting aside of arbitral awards. However, after taking into account critical feedback from practice, on June 20, 2025, the SCNA issued a revised draft proposing to return this jurisdiction to the Provincial People’s Courts. This proposal was then formalized in Article 2 of Resolution 81/2025, issued on June 27, 2025:

Article 2. Territorial Jurisdiction of Provincial People’s Courts in Respect of Requests for Setting aside and Registration of Arbitral Awards Provincial People’s Courts competent to handle requests for setting aside and registration of arbitral awards include:

1. The People’s Court of Hanoi City;
2. The People’s Court of Da Nang City;
3. The People’s Court of Ho Chi Minh City.

In jurisdictions with well-developed arbitration systems such as Singapore, Hong Kong, the United Kingdom, or Germany, the review of applications to set aside arbitral awards is assigned to high-level or specialized courts. In Singapore, the High Court performs this function through a dedicated division. Similarly, in the UK, the Commercial Court of the High Court handles such matters , while in Germany, the Higher Regional Courts are entrusted with this responsibility.

These international practices emphasize that in advanced judicial systems, the supervision of arbitral proceedings should be entrusted to high-level courts to ensure effective oversight. Thus, entrusting the power to set aside arbitral awards to provincial-level People’s Courts is consistent with international practice and judicial standards.

II. Debate on jurisdiction in the drafting of resolution 81/2025

Prior to the consensus reached under Resolution 81/2025, the draft dated May 27, 2025 proposed granting jurisdiction over setting aside of arbitral awards to Regional People’s Courts—a new institution introduced in the context of a restructured three-tier judicial system. From an institutional perspective, assigning such authority to regional courts was in line with the policy of decentralization and grassroots empowerment promoted by the State and the Communist Party of Vietnam. The establishment of regional courts as new first-instance courts aimed not only to streamline the judicial apparatus but also to enhance case-handling capacity at the grassroots-level. This would help alleviate caseloads for provincial-level courts and expand equitable access to justice for both public and private parties engaged in judicial processes.

Despite these perceived advantages, the proposal to assign jurisdiction to Regional People’s Courts sparked considerable controversy. Many legal experts raised concerns that the proposal posed risks in terms of both organizational capacity and practical application.

First, from an organizational standpoint, Regional People’s Courts are newly established bodies composed largely of former District Court judges, who lack the specialized training and practical experience required for arbitration-related matters. The review of setting aside petitions demands not only procedural legal expertise but also deep understanding of commercial principles and international trade practices—areas in which a nascent institution would struggle to develop immediate capacity.

Second, in practice, the application of certain legal grounds—such as “contrary to the fundamental principles of Vietnamese law” or “exclusive jurisdiction of Vietnamese courts”—remains contentious, as there is no unified interpretative framework. Delegating this jurisdiction to courts with less experienced judges risks increasing legal uncertainty and inconsistency in rulings.
Third, the procedural framework for reviewing setting aside petitions lacks a supervisory mechanism—meaning that decisions are final and not subject to appeal. In such a context, any legal or technical error may lead to serious and irreparable consequences.

The cumulative effect of these factors is a significant risk to the quality of setting aside decisions. Legal instability and unpredictability in the supervision of arbitral awards may erode investor confidence—especially among foreign investors—in Vietnam’s dispute resolution system. This not only increases the likelihood of investor-state arbitration claims but also negatively impacts Vietnam’s international image and its ability to attract foreign direct investment.

III. Determination of jurisdiction: new draft and resolution 81/2025

The SCNA’s revised draft dated June 20, 2025 redirected jurisdiction for setting aside of arbitral awards back to Provincial People’s Courts, abandoning the initial proposal to assign it to Regional People’s Courts. Furthermore, to enhance specialization and administrative focus, the draft proposed concentrating jurisdiction in three key provincial courts—Hanoi, Da Nang, and Ho Chi Minh City—which handle the majority of arbitration-related cases and have experienced judicial personnel. This policy choice was codified in Resolution 81/2025 issued on June 27, 2025. The rationale for this policy includes:

First, in terms of institutional experience and professional continuity, Provincial People’s Courts have built a strong foundational expertise in handling setting aside petitions since the Law on Commercial Arbitration 2010 came into effect. Maintaining jurisdiction at this level ensures organizational continuity and avoids disruptions that might arise from a jurisdictional shift.
Second, in terms of the judicial hierarchy, Regional People’s Courts are defined as first-instance courts, whereas provincial-level courts primarily exercise appellate jurisdiction. Given that arbitral tribunals are considered independent adjudicative bodies equivalent to first-instance courts, any petition to set aside an arbitral award should be reviewed by a higher judicial body—both in terms of hierarchy and expertise. This ensures objectivity and aligns with judicial oversight principles.

Third, in practical terms, most arbitration disputes in Vietnam arise in key economic regions such as Ho Chi Minh City, Hanoi, and Da Nang—areas with high concentrations of arbitration centers, enterprises, and foreign investors. Therefore, consolidating jurisdiction in these regions aligns with resource allocation management and promotes higher-quality adjudication. In terms of specialization, limiting jurisdiction to three courts enables the development of a highly skilled judicial personnel, reducing interpretative inconsistencies and enhancing the predictability and stability of the legal framework—qualities especially valued by the business and investment communities.

In the past, some argued that judges reviewing petitions to set aside arbitral awards should seek guidance from higher courts (typically the Supreme People’s Court) if they intended to set aside the arbitral award, but could proceed independently if they denied it. The issuance of Resolution 81/2025/UBTVQH15 represents a cautious and incremental step in judicial reform. Retaining jurisdiction for setting aside of arbitral awards at the provincial court level is a legally and practically sound compromise, reflecting international norms and investor expectations of stability and legal predictability.

Given the increasing scale and complexity of arbitration disputes, entrusting this supervisory responsibility to an experienced and professionally capable judicial body is essential. The model of concentrating jurisdiction in three major courts—Hanoi, Da Nang, and Ho Chi Minh City—is a workable and realistic solution for Vietnam under current conditions.

Authors: Managing Partner Tran Duy Canh and Trainee Associate Ngo Thi Minh Nguyet.