Commercial Brokerage Under Vietnamese Law

Short answer: Commercial brokerage is a commercial activity whereby a broker acts as an intermediary for parties buying/selling goods or supplying services to establish relations and negotiate and conclude contracts in return for remuneration. The key point to remember: the broker is not a party to the resulting contract and is not responsible for performing it (Articles 150–151 of the Commercial Law 2005).

Legal basis

• Articles 150–160 of the Commercial Law 2005 — commercial brokerage.

Characteristics of commercial brokerage

• The broker acts as an intermediary: introducing parties and facilitating negotiation and contract conclusion;
• The broker does not act in its own name and is not a party to the sale/service contract;
• The broker earns brokerage remuneration (commission) as agreed;
• Distinguished from representation of a trader: a representative establishes transactions in the principal’s name.

Rights and obligations of the broker

• Obligations: preserving entrusted documents and goods samples; acting honestly in introductions; not disclosing the parties’ secrets; not brokering for both sides with conflicting interests without consent;
• Rights: receiving brokerage remuneration when a contract is concluded through the broker’s efforts; claiming agreed reasonable expenses incurred.

Brokerage remuneration

• The remuneration level is agreed by the parties; absent agreement, the customary level for similar work applies;
• The broker earns remuneration when the contract between the parties is concluded through its intermediation;
• Parties should clearly agree on when the right to remuneration arises (at contract conclusion or at full performance) to avoid disputes.

Notes when signing a brokerage contract

• Specify the scope of brokerage work and whether it is exclusive;
• Agree on a mechanism for proving a “successful transaction through brokerage”;
• Provide for client information confidentiality and breach penalties;
• Agree on dispute resolution (negotiation, mediation, arbitration or court).

If you need to determine the appropriate approach for your specific situation, you should discuss it with a lawyer beforehand to have your file reviewed and a suitable solution advised.

For quick advice, you may contact a lawyer via 0966.475.966.

Related articles

• Representation of traders under the Commercial Law
• Entrusted purchase and sale of goods
• Regulations on commercial franchising