DISPUTE SETTLEMENT THROUGH NEGOTIATION,

CONCILIATION AND MEDIATION PROCESSES IN VIETNAM

Dr. Trần Văn Quảng

I. General concepts of negotiation, conciliation and mediation

processes

1. Grounds of formation of negotiation, conciliation and mediation

processes

In a society, differences, disputes and conflicts of values and interests

are inevitable during the course of ceaseless movement of socio-economic
relations. These differences and conflicts of values and interests may cause
disputes between the owners of those values and interests. This is a regulatory
rule of human society. In order to avoid the negative consequences that might
be caused to the society by the disputes, dispute settlement mechanisms have
been forged as an objective requirement. History has seen several methods
formed as to resolve disputes in all aspects of the society such as: government
judicial process, alternative dispute resolutions including mediation,
conciliation, negotiation, and arbitration, etc. Therefore, it can be confirmed
that the very first ground for the formation of dispute settlement processes in
general and negotiation, conciliation and mediation in particular is the
practical demand of the socio-economic life. In other words, the socio-
economic structure is fundamental to the formation of dispute settlement
processes.

In Vietnam, as well as in many countries all over the world, dispute

settlement processes through negotiation, conciliation and mediation were
formed on the bases of socio-economic conditions and deeply influenced by
political, cultural and historical factors of each period. Initially, these
processes came into being based on the demand of national unity in the
struggle for existence and development. Blessed with the tradition of
community unity and solidarity which has been forged and preserved
throughout the history of thousands-of-years founding and protecting the
country, Vietnamese people always hold in high records and give high
prominence to the spirit of mutual affection and care, typically the idea of “let
the bygone be bygone”. Thus, in the event of dispute, the very first measure to
be applied would be negotiation, conciliation and mediation, through which
any party to the dispute would understand better the other(s) while the dispute
would be resolved with the relationship preserved. Another factor that worths
to be mentioned is the cultural values of Vietnamese comportment. Just like in
many other Oriental countries, Vietnamese people believe that “a bad
compromise is better than a good lawsuit”, they normally feel hesitant with
legal proceedings and any reference to a court would be interpreted as a grief.

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From the above, the immediate action to be taken whenever a dispute arises in
real life is not to launch a lawsuit but to settle the dispute through negotiation,
conciliation and mediation since these processes are deeply bound with social
and human values.

These processes, which were formed and developed alongside the flow
of the national history, have gradually become popular and recognized by law.
This is a firm legal basis for these processes to continue their existence and
uphold their role as measures to resolve disputes in social life.

2. Some basic concepts and distinction between negotiation,

conciliation and mediation

2.1. Concepts and overall natures

Negotiation: According to the Vietnamese Dictionary, negotiation is

“discussion with an aim to reach an agreement on resolution of a certain issue
between the two” (Vietnamese Dictionary, Chief editor: Hoang Phe,
Lexicographic Centre - Da Nang Publisher, Hà Nội – Đà Nẵng, 1997).
According to the Law Dictionary of the Academy of Laws under the Ministry
of Justice, negotiation is a process to resolve economic disputes through
which the parties to a dispute discuss the solution to eliminate the dispute
without any intervention or assistance from a third party. The resolution
achieved through negotiation by the parties will be exercised on a voluntary
basis. Besides, there are still other definitions of “negotiation” in the world.
Some people define negotiation as one of the basic alternative dispute
resolution (Wikipedia, the free encyclopedia.htm). When conducting
negotiation, each party needs to have a person to represent its organization
who understands thoroughly the disputed issues and who has negotiative skills
and competences.

Negotiation is a notion which is commonly used in many fields

including business, governmental and non-governmental activites, etc. The
most essential characteristic of negotiation is the absence of a third party
which gives room to the disputants, at their own discretion, to agree on the
solution to their issue.

Conciliation: Conciliation is a traditional approach to settle the disputes

in social life; however, there are still many disaccords with regard to the
notion of conciliation. There are many different definitions of conciliation in
the world. In the Black’s Law Dictionary, conciliation is defined as “an
intervention, an intermediary process, and an action of a third party in the role
of a mediator between the two disputants with an aim to persuade them to
settle or resolve their dispute. The dispute is resolved through a neutral third

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party (West Pub.Co (1983), Black’s Law Dictionary with pronunciation). In a
French Law Dictionary, “conciliation is a dispute settlement process with
assistance from a intermediary third party (conciliator) who help to
recommend amicable resolutions” (Press Univ.de France, 2 edition (1990),
Vocubulaire Juridique). Also, there are several definitions of conciliation in
Vietnam. According to Vietnamese Dictionary, conciliation is “to persuade
the parties to agree on an amicable settlement of their conflicts or
disagreements” (Vietnamese Dictionary, Chief editor: Hoang Phe,
Lexicographic Centre - Da Nang Publisher, Hà Nội – Đà Nẵng, 1997). The
Legal Terminology used in the activities of the National Assembly and the
People’s Council (Nguyễn Duy Lam, Chief editor: Dr. Nguyen Thanh,
Judiciary Publisher, 2004) defines conciliation as “settlement of disputes,
disaccords between two or more parties through arrangement, negotiation
with the involvement of a third party (non-disputants). Article 1 of the
Ordinance on organizing and undertaking conciliation at the ground level in
1998 raised a definition of conciliation at the ground level “conciliation at the
ground level is to guide, facilitate and persuade the parties to achieve
agreement on and voluntary resolution of minor breeches of law and disputes
so as to preserve the communal harmony, prevent and limit breeches of law,
ensure social order and security of the community”. From the conceptions in
the world and in Vietnam, several overall characteristics of conciliation can be
drawn as follows: Firstly, conciliation is a dispute settlement process;
Secondly, the central actor of conciliation is the intermediary party who
facilitates the disputants to achieve mutual accords on dispute resolution;
Thirdly, any adjustment and agreement with regard to dispute resolution must
be decided by the disputants. As such, it can be understood that conciliation is
a dispute settlement process, through which, the disputants, with assistance
from an independent third party acting as an intermediary, discuss to resolve
their disputes on a voluntary basis in accordance with laws, tradition and
social ethics. In some practical cases in Vietnam, the term “self-conciliation”
is mentioned beside “conciliation”. The distinction between the two notions:
conciliation is always executed with the involvement of an independent third
party while self-conciliation is substantially negotiation between the parties
without the presence of any third party - a characteristic of conciliation.

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 Mediation: In Transcultural mediation in the Asia – Pacific (Asia –
Pacific Organization for mediation, Manila, Philipines, 1988) “mediation is
an informal, voluntary and private process in which a mediator selected by
the parties will facilitate the disputants to achieve a solution agreed by the
parties”. According to Wikipedia, mediation is a form of alternative dispute
resolution (ADR), also refers to appropriate dispute resolution, and aims to
assist two (or more) disputants in reaching an agreement. Whether an
agreement results or not, and whatever the content of that agreement, if any,
the parties themselves determine - rather than accepting something imposed
by a third party. In Vietnam, mediation is defined in Vietnamese Dictionary
as “1) room in the middle with the nature of a transition or a joint between a
pair of something; or 2) in the middle, playing an intermediary role in a
bilateral relation”... From the above, it can be understood that mediation is a
dispute settlement process through a third party who plays an intermediary
role to help the two parties achieve a mutual accord.
However, these conceptions are mainly considered from the angle of
linguistics; however, from the legal point of view, they have not yet been
officially recorded in any legal document.
Based upon the above analyses, the overall characteristics of the three
processes: negotiation, conciliation and mediation can be summarized as
follows:
Firstly, dispute settlement processes were formed on the ground of
social relations, the nature of which was established on the bases of equality,
freedom, willingness and agreement between the parties. This is the most
important common characteristic of these processes;
Secondly, these processes can be selected by the parties to resolve their
disputes and they can substitute judiciary processes;
Thirdly, during the course of dispute settlement, even with the presence
of a third party (as in conciliation and mediation), the parties are placed under
no pressure from any outsider to achieve an agreement. This characteristic
helps distinguish these processes with judiciary processes which will result in
an award binding on the parties.
2.2. Distinction between negotiation, conciliation and mediation

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 Despite of several features in common, there are certain differences
between the three processes and it is exceptionally important to clarify these
differences, both theoretically and practically.
Firstly, negotiation is different form conciliation and mediation in the
time of application; negotiation always applies before conciliation or
mediation and only when the parties can not successfully negotiate then
intervention from an independent third party will be needed for dispute
settlement.
Secondly, negotiation only involves the disputants without intervention
from an independent third party which is needed in conciliation and
mediation.
The most problematic issue is how to distinguish conciliation and
mediation. The difficulty in distinguishing these two terms lies in their
common nature: a third party presents in the process of both conciliation and
mediation and is responsible to identify the disputed issues, recommend the
options for the parties to achieve a resolution which is suitable to both parties.
In Vietnam, the distinction between mediation and conciliation is not
really clear. Conciliation is the main process and applies frequently while
mediation is not yet utilized or imperceptibly integrated to conciliation into a
vague expression “conciliatory mediation”. However, from the practical
application of these processes in Vietnam, we would present several
differences as below:
Firstly, the most remarkable difference between conciliation and
mediation lies in the role of the independent third party in the process of
dispute settlement. During conciliation process, the conciliator is supposed to
meet the parties and bring them to sit with each other in order to jointly define
the disputed or conflicted issues. Also, the conciliator points out the relevance
and irrelevance from the legal point of view thus persuade the disputants to
arrive in an agreed solution. In conciliation at ground level - a typical form of
conciliation in Vietnam - the substantial role of the conciliator is to moderate
or reduce tensions in the disputes, persuade the disputants to restrain
themselves and observe the laws, lead the parties to behave in a cultured and
lawful manner. Whilst, in the mediation process (not yet popular in Vietnam),
in common sense, the third party plays the role of a bridge between the parties

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who have difficulties with direct contact so as to transmit the position and
settlement recommendations of one party to the other and backward, which is
normally referred to as “conciliatory mediation”. In some exceptional cases,
for instance where a nation mediates the conflict between two other nations in
a process known as “shuttle diplomacy”, the third party - the mediator -
attempts to propose a solution and persuade the parties to accept it following
the consultation with the parties. Also reflecting this notion, the Conciliation
rules of the International Arbitration Centre has referred to the role of the
conciliator as follows:
1. the conciliator, by his own efforts, conducts conciliation on an
independent, impartial and objective basis to help the parties
achieve a conciliation solution to the dispute;
2. the conciliator must base the conciliation process on the parties’
agreements, the business practices between the parties and the
context of dispute;
3. the conciliator may implement conciliation in a way as he deems fit
to the nature and content of the dispute as well as the parties’
expectations.
4. the conciliator may, at any time in the course of conciliation, give a
recommendation on settling the dispute. Such recommendation is
not necessarily made in writing or with reasoning.
In summary, it can be concluded that in Vietnam the role of the third
party in conciliation is more proactive and initiative than that of the third
party in mediation. It’s because of this difference in activeness of the third
party that people, mentioning mediation, normally think of the independence,
objectivity and neutrality of the third party while a conciliator is usually
referred to with his/her role of dispute moderation.
Secondly, the conciliators are practically familiar with the field in
which they undertake conciliation since they can provide recommendations to
the disputes as well as legal consultancy. This is exemplified by the role of
judges, arbitrators or conciliators in the process of conciliation in Vietnam
who assume not only conciliation but also interpretation of laws. Therefore, a
conciliator must have professional expertise and conciliating and consulting

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skills apart from credibility. This is different form mediation where credibility
is the first and foremost requirement for a mediator.
There are still many arguments surrounding this matter in the world,
one of which defines conciliation as a particular form of mediation
(“conciliation, is included as well, but for present purposes it can be regarded
as a form of mediation,” Wikipedia, the free encyclopaedia), while another
contradictorily assumes that in some circumstances, conciliation covers
mediation and some other process ("Conciliation" sometimes serves as an
umbrella-term that covers all mediation and facilitative and advisory dispute-
resolution processes, Wikipedia, the free encyclopaedia).
According to Transcultral mediation in the Asia – Pacific (Asia –
Pacific Organization for mediation, Manila, Philippines, 1988) conciliation
and mediation are translated as similar processes; which, in the narrow
meaning of the two conceptions, are different in: i) in conciliation, the
intervention of the conciliator is limited within encouraging the disputants to
negotiate and resolve their issues. The conciliator plays an intermediary role
to facilitate the communication between the parties and create possibilities for
negotiation. Meanwhile, the mediator is more proactive with the capability to
provide advices, implications and recommendations of compromise in order
to restore the relationship between the disputants; ii) conciliation implies the
institutional capacity which requires either establishment and training of a
well-organised team of conciliators or integration of conciliation into the
services of existing agencies, which is not present in mediation. On the
contrary, some people heighten the proactive role of the third party in
conciliation rather than in mediation, specifically, “the conciliator appointed
under an agreement between the parties will encourage the parties to
negotiate and give recommendations and proposals which he deems fair
solutions to the dispute. However, while the conciliator may encourage the
parties to accept his proposals, the mediator normally does not give any
recommendations or proposals but meet either party separately to establish
the position of each party in negotiation. In fact, he facilitates the parties to
negotiation their own solution...” (pages 368-369, Biennial conference of the
international federation of commercial arbitration institutions, Swiss

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Arbitration Association, Geneva, October 24, 1997). Thus, there is not yet a
clear distinction between mediation and conciliation in the world.
3. Scope of application of negotiation, conciliation and mediation
From the typical nature of these dispute settlement processes: formation
on the grounds of social relations on the bases of equality, freedom,
willingness and agreement of the parties. As such, only disputes in the fields
where the legal relation is formed on the bases of equality, freedom,
willingness and agreement of the parties can be the object of these processes.
In several particular cases, these dispute settlement processes are even not
allowed to be applied (for instance civil cases arising from unlawful or
unethical transactions).
Hence, it can be noticed that the major fields where these processes can
be applied to resolve disputes includes: disputes in labour, commerce, family -
marriage, business and civil affairs, etc (generally known as civil legal
relations in broad sense). On the other hand, these processes cannot be utilized
in penal and administrative relations as the parties to these relations do not
have equality in legal status.
4. Status and significance of negotiation, conciliation and mediation
processes with regard to dispute settlement
Negotiation, conciliation and mediation have become parts of the
system of dispute settlement processes of the society. They have important
status and significance in protecting the lawful rights and interests of the
social members and contribute to keeping the social relations in order.

Firstly, they contribute to effective settlement of disputes, saving of time

and money of civilians and state agencies.
In terms of socio-economy, theses processes help the parties gain better
mutual understanding and sympathy and with their relationship healed and
maintained. These processes, especially conciliation help improving the legal
consciousness of the people. On the other hand, these processes, if
successfully applied without referring to adjudication, will save a lot of time
and money while the targets are still achieved.

Secondly, they restore and reinforce the harmony among communities.

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 The above dispute settlement processes can apply to the matter between
the disputants even when the disputes relate to the legal rights and obligations
which must be referred to the court. They do not only enhance the
effectiveness of dispute settlement but also reflect the civilization in social
affairs and help the disputants gain mutual understanding and sympathy. They
contribute to displaying the tradition of mutual affection and care and restore
and reinforce the harmony among the communities.
Thirdly, conciliation is the dispute settlement process relevant to the
current trend.
Given the conditions of the socialism oriented market economy where
civil and economic exchanges grow increasingly both in types and contents,
interact and interfere each other. The scope of social relations, especially civil
and economic ones are no longer limited within families, communities or
nations but expanded to the regional and global range. However, the dark side
of the market economy is producing deep impacts on every aspect of the
society and disputes tend to increase both in number and complexity. It is very
important to maintain and improve the operation of the above dispute
settlement processes in order to amicably resolve disputes and differences,
restore trusts, promote civil and economic exchanges, protect personal basic
rights, and preserve peace and security in the relations between nations.
Besides, these processes, with the capacity to substitute adjudicative
processes will display their important effects with regard to disputes in the
fields of commerce and investment including foreign elements where the
parties have many differences in proceedings of dispute settlement.
II. Current conditions of dispute settlement through negotiation,
conciliation and mediation in Vietnam
1. Legal framework for negotiation, conciliation and mediation in
dispute settlement in Vietnam
The system of effecting legal documents includes provisions on dispute
settlement through negotiation and conciliation. For ease of understanding,
these processes can be classified into adjudicatory and non-adjudicatory
negotiation, conciliation and mediation.
1.1. Adjudicatory negotiation, conciliation and mediation

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 Adjudicatory negotiation, conciliation and mediation are known to be
executed at the adjudicatory agencies receiving and resolving a certain dispute
at the request of one or more parties.
First: in civil procedures (Civil Procedural Code in 2005 - the Code in
short)
a) Conciliation process:
This process is applied to disputes in civil affairs including marriage,
family, labour, commerce (generally called civil cases). The Code stipulates
that “the court is responsible for conducting conciliation and facilitating the
interested parties to discuss and agree on settlement of the dispute in
accordance with this Code” (Article 10). Also, the following details are
specified:
- Conciliation proceedings: within the preparatory period for the first-
instance trial, the court conduct conciliation so that the interested parties
discuss and agree on settlement of dispute, except for the cases which are not
subject to conciliation or cannot be conciliated (Articles 181 and 182 of the
Code). Conciliation is grounded on the following principles: a) Respect of the
willingness of the interested parties, no violence or no threat of violence to
force the parties to reach an agreement against their own will; b) the content
of the parties’ agreement must not contravene the laws or social ethics.
- Civil cases not subject to conciliation include: claims for
compensation for the damages to the State properties; civil cases arising from
unlawful or unethical transactions.
- Attendants to the conciliation session: a judge to preside the session,
the court registrar to take the minutes of the session; the interested parties or
the legal representatives of the interested parties. In a case involving many
parties, if any party is absent in the conciliation session but the present parties
still agree to proceed conciliation and such conciliation does not affect the
rights and obligations of the absent party then the court conduct conciliation
between the present parties; if the parties suggest to delay the session until all
the parties can attend then the court has to delay the session; Interpreter must
be arranged if any party is not fluent in Vietnamese.

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 - Conciliation content: the court advises the parties about the provisions
of the laws related to dispute settlement so that the parties can liaise with their
rights and obligations, analyses the legal consequences of a successful
conciliation so that they voluntarily agree on settlement of the case.
b) Negotiation process:
Although the Code does not contain any provision of negotiation as an
independent process, Article 10 stipulates that “the court is responsible for
conducting conciliation and facilitating the parties to discuss and agree on
settling the civil case in accordance with this Code”. Especially, Paragraph 2
Article 5 specifies that “in the settlement process of the civil case, the parties
are entitled to terminate or amend their claim or achieve a mutual agreement
in a voluntary basis which does not undermine the laws and social ethics”. As
such, it is clear that the laws has accepted that the parties have the right to
reach an agreement to settle the civil dispute, which can be logically
interpreted as the right to apply negotiation to settle disputes.
Second: in Arbitration proceedings
These processes are specified in the amended Labour Law and the
Ordinance on Commercial Arbitration in 2003.
a) Conciliation process
Article 37 of the Ordinance on Commercial Arbitration in 2003
stipulates that “the parties may request the Arbitral Tribunal to conciliate. In
case of successful conciliation, the parties may request the Arbitral Tribunal
to prepare the minutes of successful conciliation and issue an award to certify
such successful conciliation. The minutes of successful conciliation must be
signed by the parties and the Arbitrators. The award to certify successful
conciliation by the Arbitral Tribunal is final and must be executed under
Article 57 of the Ordinance.
The amended Labour Law provides in Article 171 that Labour Arbitral
Tribunal expedites conciliation and settle any collective labour dispute not
later than 10 days from the receipt of request. The session to resolve the
collective labour dispute must be attended by the authorized representatives of
the two parties. The Labour Arbitral Tribunal may, if necessary, invite
representatives from trade union at a higher level and from the concerned state
agencies to attend the session. The Labour Arbitral Tribunal will then

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recommend a conciliation measure for the parties’ consideration. In case of
consent by both parties, the minutes of successful conciliation will be
prepared and signed by the parties to the dispute and the Chairperson of the
Labour Arbitral Tribunal. The parties are obliged to comply with the
agreements recorded in the minutes of successful conciliation. Should the
conciliation process fails, the Labour Arbitral Tribunal will handle the dispute
and immediately notify the parties of its decision; such decision will be
automatically enforceable if the parties do not give any feedback.
b) Negotiation
Article 37 of the Ordinance of Commercial Arbitration also stipulates
that “the parties may conciliate at their own discretion in the course of
arbitration. In case of successful conciliation, the Arbitral Tribunal will cease
its proceedings at the request of the parties”. Conciliators are not present in
this case so naturally it is a provision of negotiation with view to settle
disputes.
1.2. Non-adjudication negotiation, conciliation and mediation
Non-adjudication negotiation, conciliation and mediation are
interpreted as the processes to be executed before any judiciary agency handle
the case and the third party is not a judiciary agency.
a) Conciliation process
The most popular non-adjudication conciliation process is conciliation
at the ground level as specified in the Ordinance of organizing and
undertaking conciliation at the ground level in 1998. According to this
ordinance, conciliation at the ground level is to guide, facilitate and persuade
the parties to achieve agreement on and voluntary resolution of minor
breeches of law and disputes so as to preserve the communal harmony,
prevent and limit breeches of law, ensure social order and security of the
community.
Form of conciliation: conciliation at the ground level is executed by
Conciliation Teams or other suitable organizations of the inhabitants within a
village, a quarter or other forms of community in accordance with the laws,
social ethics, fine customs and habits of the people.
Scope of conciliation: conciliation is applied to minor breeches of laws
and disputes in the communities including: individual conflicts and

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disagreements, disputes over benefits and interests arising from civil relations,
marriage and family relations; other breeches of laws which are not serious
enough to apply criminal or administrative remedies. Meanwhile, the cases
not subject to conciliation are also made clear, which include criminal acts,
save for the cases the victims do not request for criminal sanctions and the
competent authorities do not apply administrative measures in accordance
with the laws; breeches of laws which are subject to administrative measures
and other disputes identified by the laws as not subject to conciliation. It is
forbidden to make use of conciliation as a way to escape from criminal or
administrative measures.
Principles of conciliation: conciliation process is executed with the
following principles: comply with the orientation and policies of the Party
(Vietnam Communist Party), the laws of the state, social ethics and fine
customs and habits of the people; respect the parties’ willingness, no pressure
to force the parties to conciliate; be objective, impartial, reasonable and
sympathetic; maintain secrecy of the disputants’ personal information, respect
others’ lawful rights and benefits; no infringement of the state or public
interests; be timely, proactive and persistent with view to prevent breeches of
laws, limit other potential negative consequences and obtain successful
conciliation.
Conciliation teams: Conciliation teams at the ground level are self-
managed organizations established by the inhabitants of villages, quarters and
other forms of community with an aim to settle or to organize settlement of
minor breeches of laws and disputes in the communities in accordance with
the laws. Each Conciliation team is composed of a team leader and team
members selected and nominated by the Fatherland Front at the commune
level in cooperation with the attached bodies of the Front, elected by the
people and recognized by the People’s Committee at the same level.
Several cases of other non-adjudication conciliation
The Labour Law in 1994, amended in 2002 and 2007 provides for
conciliation proceedings of the Labour Conciliation Councils at the ground
level or of labour conciliators of labour authorities at the district level, which
are regarded as the competent authorities to handle individual and collective
labour disputes. Article 164 regulates the process of individual dispute

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conciliation as follows: the Labour Conciliation Council at the ground level
expedites conciliation no later than 7 days from the receipt of the request for
conciliation. The conciliation session must be attended by the parties or their
authorized representatives. The Labour Conciliation Council will then
recommend a conciliation measure for the parties’ consideration. In case of
consent by both parties, the minutes of successful conciliation will be
prepared and signed by the parties to the dispute and the Chairperson and
Secretary of the Labour Conciliation Council. The parties are obliged to
comply with the agreements recorded in the minutes of successful
conciliation. If the conciliation process fails or either party is absent for the
second time despite valid summons without any reasonable excuses, the
Labour Conciliation Council will prepare the minutes of unsuccessful
conciliation, a copy of which must be sent to the parties within 3 days from
the date of unsuccessful conciliation. Each party is entitled to refer the case to
the People’s Court for settlement. The claim sent to People’s Court must be
accompanied by the minutes of unsuccessful conciliation.
Article 170 regulates the process of individual dispute conciliation as
follows: the Labour Conciliation Council at the ground level or labour
conciliator expedites conciliation no later than 7 days from the receipt of the
request for conciliation. The conciliation session must be attended by the
parties or their authorized representatives. The Labour Conciliation Council or
labour conciliator will then recommend a conciliation measure for the parties’
consideration. In case of consent by both parties, the minutes of successful
conciliation will be prepared and signed by the parties to the dispute and the
Chairperson and Secretary of the Labour Conciliation Council or labour
conciliator. The parties are obliged to comply with the agreements recorded in
the minutes of successful conciliation. If the conciliation process fails, the
Labour Conciliation Council or labour conciliator will prepare the minutes of
unsuccessful conciliation, recording opinions of the parties, the Chairperson
and Secretary of the Council or labour conciliator; either or both party(ies) has
the right to refer the case to the Labour Arbitration Tribunal at the provincial
level.
Admittedly, this conciliation process is handled by the Labour
Conciliation Council at the ground level (or labour conciliators under labour

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authorities at the district level) which plays the role of agencies or
organizations authorized to handle individual and collective labour disputes,
yet, we regard this as non-adjudication conciliation because it is substantially
a pre-adjudication procedure - a step to be taken before a case is handled and
resolved by a judiciary body.
b) Negotiation process
Article 317 of the Commercial Law in 2005 provides for dispute
settlement through negotiation between the parties.
The amended Labour Law stipulates in Article 158 that “labour
disputes are resolved through the following principles: direct negotiation and
private arrangement between the disputants at the place where the dispute
arise...”
For the time being, mediation process has not yet been provided for in
both adjudication and non-adjudication processes. However, Article 317 of
the Commercial Law in 2005 specifies that “conciliation between the parties
is executed by an agency, an organization or an individual appointed as
mediator by the parties”. This provision leads to confusion between mediation
and conciliation, which, on the other hand, reflects precisely a reality in
Vietnam - there is not a clear distinction between mediation and conciliation.
Both terms are used to refer to conciliation or intermediary conciliation.
Besides, some believe that conciliation also exists in civil judgement
execution. However, we believe that conciliation in this case is conciliation of
disputes arising from execution of judgements, not that of cases resolved by
the court through enforceable judgements.
1.3. The extent of intervention or support from the laws to dispute
settlement through negotiation, conciliation and mediation in Vietnam.
Mentioning intervention or support from the laws is referring to the
sense that these processes cannot be detached from the control and
governance of the laws. The matters here are how far the limit of such control
goes and whether the impact from such control is positive or negative.
From the provisions of the laws on dispute settlement through
negotiation, conciliation and mediation, it can be noted that the extent of
intervention or support to each process varies from adjudication to non-
adjudication. It is obvious that adjudication processes are controlled in a

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stricter manner than non-adjudication processes, which is displayed the most
apparently in the results of the processes. The results of adjudication
processes are recognized by a legally valid decision which is binding on the
parties while in non-adjudication processes, for instance conciliation at the
ground level, there are no clear provisions of validity.
The extent of intervention or support is reflected in the provisions of
laws on the principles, organization of these dispute settlement processes. As
such, it can be noticed that the effecting laws of Vietnam contains very
rigorous provisions on conciliation, notably adjudication conciliation and rare
provisions on negotiation and mediation. The laws specify the principles of
conducting conciliation (“in civil relation, conciliation in accordance with the
laws is encouraged” - Article 12, Civil Code in 2005), the content of
conciliation, the cases not subject to conciliation, attendants to a conciliation
session, conciliation proceedings, etc, as well as the principle to secure the
right of the parties to proceed negotiation, conciliation and mediation. Also in
non-adjudication conciliation, the laws provide for principles, scope, content
and the cases not subject to conciliation in a very detailed manner (for
example in conciliation at the ground level).
Therefore, it can be said that the effecting laws of Vietnam impose a
close control on application of negotiation, conciliation and mediation
processes.
2. Paradigms of dispute settlement through negotiation, conciliation
and mediation
From the above analyses of legal provisions, we can draw some
paradigms of dispute settlement through negotiation, conciliation (mediation
has not been clearly defined and normally confused with conciliation as
mentioned above) as follows:
2.1. Paradigm of dispute settlement through adjudicatory negotiation,
conciliation
a) In civil procedures
The courts are vested with the authority to conciliate the dispute of the
parties and guarantee compliance with the principles and provisions of laws in
the course of conciliation. The legal basis of court annexed conciliation can be
found in the Civil Procedural Code in 2004.

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 b) In arbitration procedures
Arbitral Tribunals under Commercial Arbitration Centre or Labour
Arbitral Tribunal are vested with the authority to conciliate the disputes of the
interested parties and guarantee compliance with the principles and provisions
of laws in the course of conciliation.
In respect to organizing conciliation in commercial arbitration, the
paradigm of Vietnamese International Arbitration Centre (VIAC) is worth
studying. The Centre has issued its own conciliation rules to apply in case of
request for conciliation by the Centre. According to these rules, either party
can initiate the conciliation process at the Centre by sending a request for
conciliation to VIAC in which he describe the content of dispute and his
claims; within 5 working days for the receipt of the request for conciliation
and advance payment of conciliation fee, VIAC will notify the other party of
the content of conciliation, the schedule of conciliation fee and require
advance payment of conciliation fee. Within 15 days from the receipt of such
notification, the respondent must notify VIAC of his decision whether to
accept or not to accept conciliation. If VIAC receives a reply as not to accept
conciliation or no reply upon expiration of the above period then the request
for conciliation will be deemed rejected and VIAC will notify the claimant of
such rejection. Conciliation process will start when VIAC receives a written
notice of acceptance and advance payment of the conciliation fee from the
respondent. Any acceptance of conciliation must be made in writing or in any
other equivalent forms such as telegram, telex, fax, data messages and other
forms in accordance with the laws. In case both parties file requests for
conciliation, the process will start from the time VIAC receives the requests
and advance payments.
The role of the conciliator is reflected through:
- the conciliator, by his own efforts, conducts conciliation on an
independent, impartial and objective basis to help the parties achieve a
conciliation solution to the dispute;
- the conciliator must base the conciliation process on the parties’
agreements, the business practices between the parties and the context of
dispute;

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 - the conciliator may implement conciliation in a way as he deems fit to
the nature and content of the dispute as well as the parties’ expectations.
- the conciliator may, at any time in the course of conciliation, give a
recommendation on settling the dispute. Such recommendation is not
necessarily made in writing or with reasoning.
Significance of the conciliation accords: when possibilities of dispute
resolution acceptable to both parties arise, the conciliator will prepare or
facilitate the parties to prepare the conciliation accords. By signing on such
conciliation accords, the parties eliminate the dispute and are bound by the
conciliation accords in accordance with civil laws.
The alternative nature of conciliation is clearly shown in the principle:
in the course of conciliation, the parties are committed not to engage any
arbitration or litigation proceedings on the dispute to which conciliation is
being applied. In the course of conciliation, if one or both party(ies) refers the
dispute being object of conciliation to an arbitral tribunal or a court, the
conciliation process is tacitly deemed terminated.
2.2. Paradigm of non-adjudication dispute settlement through
negotiation, conciliation
For conciliation at the ground level: Conciliation Teams conduct
conciliation. They are self-managed organizations established by the
inhabitants of villages, quarters and other forms of community. Each
Conciliation team is composed of a team leader and team members selected
and nominated by the Fatherland Front at the commune level in cooperation
with the attached bodies of the Front, elected by the people and recognized by
the People’s Committee at the same level. Conciliation Teams conduct
conciliation in accordance with the Ordinance on organising and
implementing conciliation at the ground level and its guiding documents.
For labour disputes, the Labour Conciliation Council at the ground
level of labour conciliators under labour authorities at the district level are
capable of conducting conciliation.
As for negotiation, the parties perform the process at their own
discretion and comply with the achieved agreement in accordance with the
laws and social ethics.

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 3. A brief review of the practices and roles of dispute settlement
through negotiation, conciliation and mediation
The role and effects of dispute settlement through negotiation,
conciliation and mediation are displayed in practical application but mainly
through conciliation process.
For conciliation in civil procedures, according to the Summary Report
of the Year 2005 and Orientation in 2006 of the People’s Court issued by the
Supreme Court, the rate of successful conciliation in the entire system is 40%,
in which many courts achieve 50%-60% of cases successfully conciliated.
According to an unofficial statistics, the number of economic disputes settled
through conciliation each year in accounts for approximately 50% of the
number of cases resolved by the courts.
In non-adjudication conciliation, the achieved results mainly come form
the operation of conciliation at the ground level. The rate of successful
conciliation at the ground level is increasing due to high quality of
conciliation teams. Some places such as Khanh Hoa achieve up to 95%
successful conciliation. Ha Giang and Thanh Hoa achieve 90% (figures of
2007, extracted form the Preliminary Report of 3 years of implantation of
Directive No. 32 –CT/TW dated Dec. 9 2003 by the Secretariat of the Central
Communist Party Session IX). Especially, conciliation at the ground level is
not only a dispute settlement process but also a form of legal propaganda and
education which disseminate legal information to the people. The conciliator,
in the course of conciliation, has raised the people’s awareness of laws, thus
limit disputes and breeches of laws in practice. Conciliation of collective
labour disputes has not yet shown its effectiveness with the number of strikes
tends to increase, especially in foreign invested areas. As for commercial
arbitration, the results stay modest as there are few cases handled by the
commercial arbitral tribunal. As we all know, “dispute settlement through
arbitration is a popular process which is favoured by the market economy.
However, this process has not yet been applied frequently in Vietnam and the
operation of commercial arbitration in Vietnam is still ineffective. Vietnamese
enterprises normally refer their disputes as may arise to the court”.
It is difficult to have an accurate evaluation of the effectiveness of
negotiation. This process applies mainly in settlement of labour and

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commercial disputes, notably in case of strikes. Negotiation is regarded as an
useful measure which helps the parties eliminate their disputes through
dialogue, reception of the parties’ demands to adjust policies of salary and
working hours …
Executors of these processes are mainly adjudicators (judges and
arbitrators) labour conciliators, conciliators at the ground level. Among them,
conciliators at the ground level constitute the biggest force with 119,122
conciliation teams involving 540,940 conciliators (statistics in 2007). The
minimum standard and skills of these executors vary from group: the required
qualifications of adjudicators are higher than those of labour conciliators and
conciliators at ground level so their practical achievements are better,
however, to date there are still no specific requirement of skills and
professional expertise when conducting conciliation.
Several constraints (mainly of conciliation) can be noticed such as the
imperfection of the institutions for these processes, deficient human resources
both in quantity and quality. Adjudicators have relatively high-level expertise
but have not received much training in conciliation skills, which affects the
efficiency of these processes. As for negotiation, there is still no specific
provisions on the legal validity of the negotiation outcomes so the
effectiveness of the practical application is still low.
III. Directions and measures as to improve the role of negotiation,
conciliation and mediation in dispute settlement in Vietnam
1. Institutions
General direction: in order to facilitate the parties to make their choice,
and at the same time enhance the nature as substitutes for adjudication
proceedings, the laws should provide for legal frameworks and principles for
these processes, especially those concerning the legal validity of their results;
implementation principles, minimum standards and skills of the executors of
dispute settlement through negotiation, conciliation and mediation.
The distinction between mediation and conciliation should be clarified
in the provisions of the laws and mediation process should be specified on the
ground of the basic difference from conciliation (the role of the independent
third party in the relations with the parties).

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 The provisions of the laws on these processes, especially conciliation
should be refined. Conciliation in civil procedures should be specifically
provided for in the stage of judicial review and retrial. Conciliation at the
ground level should be continuously heightened as to resolve minor disputes
and conflicts in the communities through the establishment of the law on
conciliation at the ground level.
Negotiation should be clearly defined as a dispute settlement process;
which should be, however, executed within the limit of the laws and social
ethics. In the mean time, a regime to guarantee the legal validity of negation
should be established (for example, negotiation outcomes should be
recognised and enforced by a certain competent authority...).
The courts and arbitration centres should receive institutional
strengthening so as to improve their capacity in execution of conciliation and
mediation in dispute settlement.
Finally, the above institutional building measures will contribute to the
official reaffirmation of the position of these processes in dispute settlement.
As of now, enterprises still resolve their disputes between themselves. In
many cases, they lean on the police (to collect debts on their behalf). Besides,
they can confide in credible mediators or conciliators. Also, the Legal
Department and Arbitration Centre under VCCI often receive requests for
support in conciliating the disputes between enterprises. Recognition of
conciliation as an official dispute settlement process will facilitate enterprises
to resolve the disputes which are not too complicated”.
2. Training of human resources
At first, it is necessary to refine the minimum standards and skills of the
executors of dispute settlement through negotiation, conciliation and
mediation specifically conciliators, judges, arbitrators. Though judges and
arbitrators have professional expertise in legal field, a training course on
conciliation skills and knowledge is required, and this, if provided, will be
very significant in legal point of view. For conciliators, standards of
conciliation skills and expertises are also needed to improve the conciliation
quality.

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 Continue reinforcement in term of quantity, especially of labour
conciliators, guarantee the establishment of labour conciliation councils at the
ground level of enterprises, notably foreign invested enterprises.
Organise training courses for and foster the professional ability of the
executors of the above processes.
For negotiation, qualified lawyers must be attracted to engage because
the recent practices in Vietnam have revealed that more and more enterprises
assume lawyers’ service of representing them in negotiating their disputes.
Therefore, we should also pay attention to training of negotiation skills in
dispute settlement for lawyers in general curriculum./.

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