Finality by Waiver at the Vietnam International Financial Centre: Party Autonomy or a Shortcut Around Court Reform?

Vietnam’s International Financial Centre (“VIFC”) contains a striking arbitration innovation: parties may agree to waive the right to ask a Vietnamese court to set aside an arbitral award.

At first glance, this looks like an unmistakably pro-arbitration reform. But the real question is not whether finality is desirable. It plainly is. The real question is whether finality by waiver expresses party autonomy, or merely a distrust of court supervision. If the waiver is justified principally as a way to escape unpredictable Vietnamese annulment practices, it risks becoming a shortcut around court reform rather than a principled foundation for Vietnam’s ambition to become an arbitration-friendly seat.

What the VIFC Waiver Provides

Article 30(3) of Resolution No. 222/2025/QH15 (“Resolution 222”) provides that, where the relevant parties so agree in writing, a recognised settlement or an award of the tribunal of the international arbitration centre within the VIFC is final and enforceable (“chung thẩm, có hiệu lực thi hành”). Moreover, the parties can agree to waive their right to request the court to set aside that award, and in such cases, the court shall not resolve such a request.

Article 4(5) of Decree No. 328/2025/ND-CP (“Decree 328”) is to the same effect at the institutional level, conferring the right to waive set-aside of a recognised settlement or award of the VIFC International Arbitration Centre. However, Article 4(6) of Decree 328 also specifies that the court’s set-aside role is preserved in two cases: (i) where the waiver is inconsistent with Article 18 of the Law on Commercial Arbitration on void arbitration agreements; and (ii) where it is made only after a party has filed its set-aside request.

Because the right being waived is the right to seek to set aside an award before the Vietnamese courts, the waiver is relevant only where the arbitration is seated in Vietnam. The waiver’s distinctive function is thus to make a Vietnamese seat more attractive by removing the very feature that may otherwise deter parties from choosing it.

Rationale for the Waiver: Annulment Anxiety in Vietnam

The reform does not arrive in a vacuum. Users of Vietnam-seated arbitration have long worried about how courts exercise their power to set awards aside. Recent commentary on the VIFC framework cites figures from the Vietnam Lawyers’ Association indicating that, between 2011 and 2024, 181 annulment applications were filed and 43 were granted, i.e., an annulment rate of roughly 23%. Whatever the precise figure, the perception of frequent or unpredictable annulment is itself a deterrent for commercial users. The Government’s Report No. 609/BC-CP also records that the right to waive a court set-aside application was regarded as a legitimate need of entities participating in economic activities, requested during the policy-making process by investment funds and international financial institutions to protect investors’ legitimate interests.

The users’ concern is also grounded in concrete examples. As discussed on this Blog, the People’s Court of Ho Chi Minh City set aside an award because a foreign party’s power of attorney had not been consular-legalised, treating that defect as a breach of the “fundamental principles of Vietnamese law”. That open-textured ground illustrates why users may fear the courthouse more than the arbitral process itself.

Why Annulment Waiver Needs a Theory

The ability to waive one’s recourse to annulment is not merely a tool of efficiency. It reflects a theory about the relationship between arbitration and the courts, resting on three elements. 

The first is party autonomy: sophisticated parties who choose arbitration may also legitimately narrow the supervisory role of the seat court, accepting the trade-off in exchange for speed and finality. 

The second is finality itself: awards are meant to end disputes, not to inaugurate successive rounds of litigation, and a waiver gives that promise teeth.

The third element is the one most easily overlooked: the retention of minimum judicial safeguards. Even arbitration-friendly systems generally retain some form of control over consent, capacity, due process, arbitrability, fraud, corruption, and public policy. These are not obstacles to party autonomy. They are what enables parties to trust the regime.

A waiver regime is therefore legitimate when it flows from autonomy and a calibrated allocation of judicial control. It is more fragile when it is adopted mainly because courts are thought to get annulment wrong.

Comparative Experience: Waiver Is Usually Bounded

A waiver of annulment is rarely a simple “off switch” for judicial control. It is better understood as a reallocation of control rather than its abolition. The important question is therefore not only whether the parties may waive annulment, but also what safeguards remain after they do so.

Switzerland provides one model. Article 192 of the Swiss Private International Law Act permits parties to waive setting-aside proceedings only where none of them has its domicile, habitual residence or seat in Switzerland. It means that Switzerland does not allow parties with a Swiss connection to remove the supervisory role of the Swiss courts altogether.

France adopts a different model. Article 1522 of the French Code of Civil Procedure permits parties in international arbitration to waive an action to set aside. However, Article 1522 expressly states that the waiver does not affect their right to appeal a decision granting enforcement of the award in France. The award therefore remains subject to judicial scrutiny at the enforcement stage.

As previously discussed on the Blog, waiver of annulment is not desirable in every case. Where an award contains a serious flaw, a party may still resist enforcement even if annulment recourse has been excluded. If enforcement is then sought in multiple jurisdictions, the parties may face multiple enforcement challenges, making the process more burdensome than a single annulment proceeding at the seat.

That comparative lesson matters for Vietnam, whose regime is bounded in a different way. The two carve-outs in Article 4(6) of Decree 328 both concern the waiver agreement itself: whether the waiver is consistent with Article 18 of the Law on Commercial Arbitration, and whether it was made before or after a party filed its set-aside request. Both therefore police the validity and timing of the waiver; neither addresses what happens to the award itself once a valid waiver is in place.

That is the crucial distinction. Switzerland reserves the waiver for parties with no Swiss connection, so disputes anchored there never fully escape the supervisory role of its courts. France expressly preserves a route for judicial scrutiny at the enforcement stage even where annulment has been waived. Vietnam’s carve-outs stop at the waiver agreement itself. Once that agreement is valid, Resolution 222 and Decree 328 say little about whether, and through what mechanism, the award may still be resisted at the enforcement stage. The Vietnamese regime therefore leaves unresolved, within the waiver framework itself, what residual judicial control over the award remains once the right to seek annulment has been waived.

The VIFC Tension: Sophisticated Device, Domestic Problem

Vietnam is introducing a sophisticated device, but there is a risk that it may be used to address a more domestic institutional ailment: the perception that Vietnamese courts annul too much, or too unpredictably. If the VIFC waiver is presented as “choose VIFC because Vietnamese courts cannot set the award aside”, the reform may inadvertently reinforce the very concern it seeks to dispel: that judicial review in Vietnam is not to be trusted.

This gives rise to an unavoidable policy question. If the waiver works, it may attract cases that might otherwise have been seated elsewhere, supporting Vietnam’s ambition to become a regional hub. But is an imperfect waiver that increases caseload preferable to none at all? That is a false dichotomy. A waiver that attracts cases by signalling distrust of local court supervision buys volume at the expense of the reputation on which a durable seat depends.

There is also a secondary concern of institutional asymmetry. The waiver mechanism appears, at least for now, to be tied to the VIFC arbitration framework and not to awards rendered by other Vietnamese arbitration institutions. That may raise questions of equal treatment among arbitral institutions and result in cases being brought to the VIFC at the expense of other institutions in Vietnam.

What A Principled VIFC Waiver Should Look Like

If Vietnam wants the VIFC waiver to build confidence rather than substitute for reform, several safeguards should be considered.

First, Vietnam should consider whether the option of a waiver should be unavailable for disputes with a substantial domestic nexus. The Swiss model is instructive not because it must be copied, but because it recognises that the case for contracting out of seat-court supervision is strongest where the dispute is genuinely international and the seat is chosen primarily as a neutral forum. If Vietnam chooses a broader model for the VIFC, the policy reason for that choice should be clear.

Second, the framework should expressly preserve residual control over the award. The present framework does not answer the question of what happens if the waiver is valid, but the award itself is said to involve serious due process violations, fraud, corruption, non-arbitrability, or a breach of fundamental principles of Vietnamese law. A principled regime would say expressly where that control resides – whether at the seat or as in France, at the enforcement stage – rather than leaving it to implication.

Third, courts should publish reasoned decisions on the validity and limits of waiver, at least in redacted form. Predictability requires a body of publicly accessible practice.

Finally, the waiver should complement, not replace, continued court reform and judicial training. The best arbitral seats are not those that eliminate courts from the arbitral process. They are those whose courts understand when to intervene and when to stand back. The waiver should be designed as a confidence-building mechanism, not as an escape hatch from the courts.

Conclusion: Finality Without Legitimacy Is Not Enough

The VIFC annulment waiver may become one of Vietnam’s most distinctive arbitration reforms and may help the VIFC differentiate itself in a competitive region. Only time will tell how the waiver will shape the perceptions of Vietnam as an arbitral seat. Its success, however, will depend on the theory behind it. Grounded in party autonomy, limited curial control and preserved minimum safeguards, the reform can enhance confidence in Vietnam as an arbitral seat. Used mainly to avoid unpredictable judicial practices, it may confirm the very concern it seeks to cure.