Goods Lease Under the Commercial Law of Vietnam

Short answer: Goods lease is a commercial activity whereby the lessor transfers the right to possess and use goods to the lessee for a term in exchange for rent. The rights and obligations of the parties are set out in Articles 269–275 of the Commercial Law 2005, with the core principles: the lessor guarantees the right to use the goods, and the lessee uses the goods for the agreed purpose and pays rent on time.

Legal basis

• Articles 269–275 of the Commercial Law 2005 — goods lease.

Characteristics of a goods lease contract

• Object: goods (movables) permitted for circulation;
• The lessor transfers the right to possess and use — not ownership;
• The lessee pays rent as agreed;
• At the end of the lease term, the lessee returns the goods, unless otherwise agreed.

Rights and obligations of the lessor

• Delivering the goods on time, at the place, and in the quality agreed;
• Ensuring the lessee’s right to use the goods is not subject to dispute;
• Ensuring the goods remain fit for the lease purpose throughout the lease term;
• Receiving rent as agreed.

Rights and obligations of the lessee

• Using the goods for the agreed purpose and in the agreed manner;
• Paying rent on time and by the agreed method;
• Preserving and maintaining the goods; not subleasing without the lessor’s consent;
• Returning the goods at the end of the lease term in a condition consistent with normal wear and tear;
• Bearing responsibility for damage or loss caused by its own fault.

Risk transfer and contract termination

• The risk of loss or damage to the goods during the lease term rests with the lessee, except in cases of force majeure or the lessor’s fault;
• The lessor may unilaterally terminate when the lessee fails to pay rent or uses the goods contrary to the agreement;
• The lessee may unilaterally terminate when the goods do not meet quality standards or are unfit for the lease purpose.

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

• Asset lease contracts under the Civil Code
• Handling goods that do not conform to the contract
• Regulations on commercial franchising