DISPUTE RESOLUTION MECHANISMS IN PUBLIC–PRIVATE PARTNERSHIP (PPP) INVESTMENTS IN VIETNAM: KEY CONSIDERATIONS FOR FOREIGN INVESTORS AND PPP PROJECT COMPANIES
Overview
Dispute resolution mechanisms applicable to public–private partnership (“PPP”) investments in Vietnam currently comprise two principal avenues:
(i) petition (complaint) mechanisms; and
(ii) litigation and dispute resolution proceedings.
These mechanisms are governed primarily by the Law on Investment in the Form of Public–Private Partnership No. 64/2020/QH14 dated 18 June 2020, as amended (“PPP Law”), and Decree No. 243/2025/ND-CP dated 11 September 2025 of the Government detailing a number of provisions of the PPP Law (“Decree 243”).
In this Legal Update, Mr. Phan Quang Chung, Founder and Managing Partner of BFSC Law LLC, together with Ms. Tran Hong Hanh, Associate, provide an overview and practical analysis of dispute resolution mechanisms in PPP investments from the perspective of foreign investors and PPP project companies operating in Vietnam.
1. Petition mechanisms in PPP investment activities
1.1 Scope and nature of petitions
Pursuant to Article 95.1(a) of the PPP Law, a petition in PPP investment activities refers to a petition submitted by an investor to the procuring entity or the competent authority in relation to:
(i) the investor selection process; and/or
(ii) the results of investor selection,
in accordance with procedures prescribed by the Government.
Decree 243 limits the scope of the petition mechanism to disputes arising during the investor selection stage only. Accordingly, disputes arising after investor selection, including disputes between investors or PPP project companies and competent authorities or contracting authorities during the implementation phase of a PPP project, fall outside the petition framework and must be resolved through negotiation, mediation, arbitration, or court proceedings as contractual disputes.
This distinction is particularly relevant where disputes relate to delays or failures by competent authorities or contracting authorities to perform procedural or administrative obligations under the PPP project contract.
1.2 Petitions regarding bidding documents and the investor selection process
Decree 243 distinguishes between:
(i) petitions concerning bidding documents; and
(ii) petitions concerning the investor selection process.
The resolution process follows a two-tier structure, with authority vested sequentially in:
- the procuring entity (first level); and
- the competent authority (second level).
Petitions must be submitted in writing, duly signed by an authorized representative and stamped (if applicable), or digitally signed and submitted via the National E-Procurement System, in accordance with the applicable electronic investor selection roadmap.
Petitions concerning bidding documents may be submitted by investors or other interested organizations or individuals and must be filed prior to bid closing.
Petitions concerning the investor selection process may only be submitted by participating investors and must be filed prior to the announcement of investor selection results.
1.3 Petitions regarding investor selection results
Only participating investors are entitled to submit petitions regarding investor selection results, and such petitions must relate directly to the evaluation of bidding dossiers.
Investors may only submit petitions if they have not initiated litigation, complaints, or denunciations, and must pay an advance petition handling fee to the standing body assisting the Chairman of the Petition Resolution Council. The advance fee is set at 0.02% of the total investment capital, subject to a minimum of VND 20 million and a maximum of VND 200 million.
Petitions must be submitted to the procuring entity within 10 days from the date the investor selection results are published on the National E-Procurement System.
Petitions are resolved sequentially by:
- the procuring entity; and
- the Petition Resolution Council.
1.4 Litigation in relation to petitions and petition outcomes
Article 60.4 of Decree 243 provides that, where an investor disagrees with the resolution of a petition by the procuring entity, the competent authority, or the Petition Resolution Council, the investor may initiate court proceedings.
However, a key practical issue arises as to whether investors or interested parties are required to exhaust the petition process prior to commencing litigation.
ased on Article 60.2(c) of Decree 243 and Article 89.2 of the Law on Bidding No. 22/2023/QH15, it may be interpreted that investors and interested organizations or individuals are entitled to initiate litigation directly, without being required to complete the petition process. Once litigation is initiated, the petition process must be terminated. However, having regard to considerations of timing, procedural complexity, and the overall effectiveness of legal actions, initiating court proceedings at an early stage is generally not a practical or efficient option in PPP investment activities.
It is also important to note that, pursuant to Article 94.1 of the Law on Bidding No. 22/2023/QH15, disputes relating to bidding activities are resolved under civil procedure, rather than administrative procedure, notwithstanding that one party to the dispute may be a competent state authority.
2. Disputes arising during PPP investment activities
Similar to the approach adopted under the 2025 Investment Law, Article 97 of the PPP Law provides that disputes arising from PPP investment activities may be resolved through negotiation, mediation, arbitration, or court proceedings, depending on the parties involved.
2.1 Domestic disputes
Disputes between competent authorities or contracting authorities and domestic investors or PPP project companies established by domestic investors; disputes among domestic investors; and disputes between domestic investors or PPP project companies and Vietnamese economic organizations are resolved by Vietnamese arbitration or Vietnamese courts.
2.2 Disputes involving foreign elements
Disputes between competent authorities or contracting authorities and foreign investors or PPP project companies established by foreign investors are resolved by Vietnamese arbitration or Vietnamese courts, unless otherwise agreed in the contract or provided under an applicable international treaty to which Vietnam is a party.
Disputes involving at least one foreign investor, or disputes between investors or PPP project companies and foreign organizations or individuals, may be resolved by one of the following forums, as agreed by the parties:
- Vietnamese arbitration;
- Vietnamese courts;
- foreign arbitration;
- international arbitration; or
- ad hoc arbitration established by agreement of the parties.
3. Practical considerations for foreign investors and PPP project companies
First, pursuant to Article 97.5 of the PPP Law, disputes resolved by arbitration under a PPP project contract and related agreements are characterized as commercial disputes. Foreign arbitral awards are recognized and enforced in Vietnam in accordance with applicable laws on recognition and enforcement of foreign arbitral awards.
Second, in practice, PPP-related disputes often extend beyond the contractual relationship between the competent authority, the contracting authority, and the investor or PPP project company. Such disputes may also involve lenders, including credit institutions, commercial banks, foreign bank branches, and professional securities investors.
These disputes may be affected by Vietnam’s rules on exclusive jurisdiction of Vietnamese courts, particularly in transactions involving real estate. Accordingly, foreign investors, PPP project companies, and financing parties should pay close attention to the structuring of multi-tier dispute resolution clauses, ensuring that the agreed dispute resolution mechanism remains valid, enforceable, and effective for both recognition and enforcement purposes.
Disclaimer
This publication is provided for general informational purposes only and does not constitute legal advice or a legal opinion with respect to any specific transaction or matter. The application of the laws and regulations discussed herein may vary depending on the particular facts and circumstances. Readers should seek independent legal advice before taking any action based on the contents of this publication.
BFSC Law LLC and the authors disclaim any liability for loss or damage arising from reliance upon or use of this publication.
Authors
Mr. Phan Quang Chung
Founder & Managing Partner
BFSC Law LLC
Email: [email protected]
Ms. Tran Hong Hanh
Associate
BFSC Law LLC
Email: [email protected]