Commercial arbitration is chosen by many businesses thanks to its flexibility, security, and ability to resolve disputes with international elements. However, arbitration fees can create significant financial pressure right from the time of litigation; the actual total cost also depends on the course of the proceedings and the ability to recover costs after the award.
A notable difference is the pressure of cash flow when initiating a lawsuit.
Arbitration costs include not only fees for arbitration to settle the case but also other actual amounts. Therefore, enterprises need to simultaneously assess the initial cash flow pressure, the possibility of incurring costs, the opportunity to recover costs and the commercial value of the dispute settlement results to make the best choices for their cases.
Arbitration fees are higher than court fees: What do businesses need to calculate?
In court proceedings, the level of first-instance court costs for business and commercial disputes with quotas is specified in Resolution No. 326/2016/UBTVQH14 of the Standing Committee of the National Assembly. Accordingly, first-instance court costs range from VND 3,000,000 for disputes valued at VND 60,000,000 or less to VND 112,000,000 plus 0.1% of the dispute value exceeding VND 4,000,000,000 for disputes valued at over VND 4,000,000,000[1]. Meanwhile, arbitration fees are not uniformly fixed at a fixed rate in legal documents but depend on the fee schedule of each arbitration center or the fee level set by the Arbitration Council ("Arbitration Council") in case the dispute is settled by case arbitration according to the provisions of Article 34 of the Law on Commercial Arbitration 2010 ("Law on Commercial Arbitration").
Referring to the Arbitration Fee Schedule of the Vietnam International Arbitration Center (VIAC),[2] it can be seen that for a dispute resolved by an arbitral tribunal consisting of three arbitrators, the lowest fee is VND 16,500,000 for disputes valued at VND 100,000,000 or less. For disputes valued at VND 500,000,000,001 or more, the fee is VND 3,609,300,000 plus 0.30% of the value in excess of VND 500,000,000,000. These fees show that the cost of dispute resolution at VIAC may be significantly higher than the court fee. In particular, for disputes of large value, the difference between arbitration fees and court fees can become a significant factor in the enterprise's decision to choose a dispute resolution method.
Assuming that the plaintiff requests the payment of VND 100,000,000,000 in a business or commercial dispute with a quota, the first-instance court fee calculated according to the above court fee schedule is VND 208,000,000. If the VIAC fee of VND 1,609,300,000 is applied to the Council consisting of three arbitrators as in this example, the arbitration fee is about 7.7 times higher than the first-instance court fee. This is a comparison according to the fee schedule, not the final amount that the plaintiff will definitely bear.
The fee schedule of arbitration centers may vary. With a claim value of 100,000,000,000 VND, the reference fees cited by the article from VTA, VSIAC and TRACENT are 1,458,000,000 VND, 1,000,000,000 VND and 898,000,000 VND, respectively. Before using these figures to select a center, enterprises need to compare the official fee schedule that is still in force, the number of arbitrators, the fees included and the method of determining the charge value to ensure the comparison on the same basis.[3][4][5]
A notable difference is the pressure of cash flow when initiating a lawsuit. In court proceedings, the first-instance court fee advance is determined in principle according to applicable regulations; with the above assumption, the advance is VND 104,000,000. In arbitration proceedings, the payment of fees, the deadline for payment and the ability to request additional payment depend on the rules, fee schedule of the center and the development of the case. Therefore, it is not recommended to equate the initial advance with the total final cost or assume that all cases must be paid in one lump sum.[6][7]
In addition to the required value, the number of arbitrators can also significantly affect costs. For disputes that are not too complex, a panel of one-arbitrators may be a more economical option if it is in accordance with the applicable agreement and rules; conversely, large or complex disputes may require a panel of three arbitrators. The choice should balance the cost with the requirement for expertise and quality of resolution.
Arbitration fees are only a part of the total cost of the dispute
When estimating the cost of dispute resolution by arbitration, enterprises often base on the fee schedule of the Arbitration Center to estimate the total cost to be spent. However, this calculation method does not fully reflect the actual costs that may arise during the proceedings. Because, in addition to the arbitration fee to be paid initially when initiating a lawsuit or exercising the right to sue again according to the fee schedule of the Arbitration Center, enterprises may also have to bear additional costs in the process of dispute resolution.
Specifically, after the Arbitral Tribunal is established, the enterprise may be required to advance or pay arising expenses such as travel, accommodation and other related expenses of the Arbitrator; costs for other assistance at the request of the Arbitral Tribunal; costs for using utility services provided by the Arbitration Center; as well as the cost of assessment, valuation of assets and expert consultation at the request of the Arbitration Center[8]. In addition, enterprises also need to estimate expenses for their own participation in the proceedings, such as lawyer fees, legal advisors, interpretation costs, travel and accommodation.
These costs are not incurred equally in all cases. In particular, attorney's fees can account for a significant proportion, but winning the lawsuit does not mean being fully reimbursed. The possibility of recovery depends on the agreement, procedural rules, legal basis of the claim, evidence, and evaluation of the Arbitral Tribunal. Businesses should budget according to scenarios, including if the defendant makes a counterclaim that expands the scope of the dispute.
Does winning the lawsuit mean being reimbursed in full?
In principle, Clause 3, Article 34 of the Law on Commercial Centers stipulates that the losing party must bear the arbitration fee, unless otherwise agreed by the parties or the arbitration procedure rules provide otherwise, or the arbitration tribunal has otherwise decided. In fact, the Arbitration Procedure Rules of Arbitration Centers often give the Arbitral Tribunal the right to decide on the allocation of arbitration fees, unless otherwise agreed by the parties.[9]
Accordingly, the principle that the losing party bears the arbitration fee does not mean that all cases allocate the fee in an absolute way. When the request to initiate a lawsuit or counterclaim is only partially accepted, the allocation also depends on the agreement of the parties, the applicable rules and the decision of the Arbitral Tribunal. Therefore, enterprises need to anticipate the possibility of bearing part of the fee even though the settlement result is generally beneficial to them.[10]
In addition, the Law on Commercial Arbitration does not specify the criteria that the Arbitral Tribunal must apply when deciding on the allocation of arbitration fees. Therefore, depending on the applicable arbitration procedural rules and the circumstances of each dispute, the Arbitral Tribunal may consider factors such as the degree of acceptance of each party's request, the degree of victory in the lawsuit and the way the parties exercise their procedural rights and obligations to decide on the allocation of arbitration fees. This means that enterprises need to take into account the possibility of incurring part of the arbitration fee even if a favorable outcome is achieved in the dispute.
The reimbursement rate of one center should not be applied to another center or for all stages of proceedings.
Withdrawal of the petition: What costs can be unrecoverable?
In court proceedings, Clause 3, Article 218 of the 2015 Civil Procedure Code stipulates that, when the involved parties withdraw all lawsuit requests and the Court issues a decision to suspend the settlement of the case, the paid court fee advance will be returned to the involved parties. Meanwhile, the Law on Commercial Shopping Centers does not specifically stipulate the refund of arbitration fees when the plaintiff withdraws the lawsuit petition or counter-lawsuit, but this issue is mainly governed by the procedural rules and fee schedule of each Arbitration Center.
Normally, arbitration centers stipulate the fee to be refunded based on the time when the plaintiff withdraws the lawsuit petition or counter-lawsuit, or withdraws the request for amendment or supplementation of these applications. Accordingly, the reimbursement rate is usually lower than 100% and gradually decreases depending on the stage of the proceedings in which the withdrawal is made. For example, according to the Arbitration Fee Schedule issued together with Decision No. 89/QD-VIAC dated January 25, 2016 of the Chairman of VIAC, the rate of reimbursement of arbitration fees in some cases is prescribed as follows:
- Withdrawal of the application before the arbitration agreement is established: VIAC refunds 70% of the arbitration fee.
- Withdrawal of the application after the arbitration agreement is established: VIAC refunds 40% of the arbitration fee.
- Withdraw the application after VIAC sends the summons to the dispute settlement meeting but before the opening date of the meeting: VIAC refunds 20% of the arbitration fee.
In addition to the above cases, this Fee Schedule also stipulates the level of reimbursement for some cases of suspension of dispute settlement. Specifically, VIAC refunds 30% of the arbitration fee if the arbitral tribunal issues a decision to suspend it due to the non-existence, invalidity or unenforceability of the arbitration agreement; and refund 20% of the arbitration fee if the arbitral tribunal issues a decision to suspend the dispute on the basis of the Court's decision determining that the dispute does not fall under the jurisdiction of the arbitrator. At the same time, in all cases, the remaining arbitration fee after the reimbursement by VIAC must not be lower than VND 10,000,000.
The fee refund policy can directly affect the negotiation strategy. Initiating a lawsuit too early to create negotiation pressure may cause the enterprise not to fully recover the paid fee if an agreement is later reached; but delaying too long can also give rise to the risk of statute of limitations or difficulties in preserving assets. Therefore, the time to initiate a lawsuit needs to be evaluated in the overall dispute resolution strategy.
Before filing an application or withdrawing a claim, the enterprise needs to check the fee schedule and reimbursement policy in force at the selected center, and distinguish the withdrawal from different cases of suspension of proceedings. The reimbursement rate of one center should not be applied to another center or for all stages of proceedings.
Annulled Judgment: Risk of Paying Costs a Second Time
An arbitral award may be annulled by the Court when it falls under one of the statutory grounds in Article 68 of the Law on Commercial Arbitration 2010, such as an invalid arbitration agreement, a violation of jurisdiction or procedure, or a violation of the basic principles of Vietnamese law. The procedure for considering annulment of an award is not an appellate level for retrial of the entire dispute. If the award is annulled, the parties can agree to re-settle it by arbitration or initiate a lawsuit at the Court in accordance with the law.[11]
In this case, the arbitration fee that the enterprise has paid to resolve the dispute before may become an irrecoverable expense. Because the regulations on refund of arbitration fees of the Arbitration Center often apply to specific cases such as withdrawing a lawsuit petition or suspending the settlement of the dispute, without automatically including the case where the arbitral award is annulled by the Court. At the same time, the Law on Commercial Centers 2010 does not specifically stipulate the refund of the arbitration fee paid in this case. Therefore, the enterprise may have to bear the fees incurred in the previous arbitration proceedings, even if the dispute has not been completely resolved.
If the dispute has to be resolved, the enterprise may incur additional procedural fees, attorneys' fees, evidence costs, and administrative costs, in addition to those already spent in the previous procedure. Therefore, checking the validity of the arbitration clause, jurisdiction, and compliance with the procedure from the outset is also a cost management measure. In the long term, the selection of the center, the number of arbitrators, the language and venue of proceedings from the contract drafting stage can help control financial risks.
Conclusion
Arbitration costs are not only the amount of money that businesses must pay when initiating a lawsuit, but also include the costs incurred, the possibility of recovery, and the risk of having to resolve the dispute again. Therefore, the choice of arbitration should be based on an overall assessment of costs, commercial benefits, enforceability, and appropriateness of the procedure. An effective strategy is not necessarily the one with the lowest litigation fees, but rather one that helps businesses control costs and best protect the benefits to be achieved.
[1] List of court costs and fees promulgated together with Resolution No. 326/2016/UBTVQH14.
[6] Clause 2, Article 7 of Resolution No. 326/2016/UBTVQH14.
[7] Refer to Article 40 of the 2026 Arbitration Procedure Rules of VIAC; Article 35 of the VTA Arbitration Procedure Rules, Article 37 of the TRACENT Arbitration Procedure Rules,...
[8] Refer to Article 40 of the 2026 Arbitration Procedure Rules of VIAC; Article 35 of the VTA Arbitration Procedure Rules, Article 37 of the TRACENT Arbitration Procedure Rules,...
[9] Refer to Article 1 of the VIAC 2026 Arbitration Procedure Rules; Article 36 of the VTA Arbitration Procedure Rules, Article 38 of the TRACENT Arbitration Procedure Rules,...
[10] Clause 1, Article 147 of the 2015 Civil Procedure Code stipulates that "the involved parties shall bear the first-instance court costs if their requests are not accepted by the Court, except for cases where they are exempted or not subject to first-instance court costs". At the same time, Article 26 of Resolution No. 326/2016/UBTVQH14 also clearly stipulates that "the defendant must bear all first-instance civil court costs in case all of the plaintiff's claims are accepted by the Court". On the contrary, "the plaintiff must bear all first-instance civil court costs in case all of the plaintiff's claims are not accepted by the Court".
[11] Article 71 of the 2010 Law on Commercial Arbitration.
