CONTRACT FOR PURCHASE AND SELL OF GOODSTRADE BUSINESS VOID UNDER THE LAW OF VIETNAM

The conditions of validity of the Goods Sale and Purchase Contract are subject to the provisions of the Civil Code 2005 and the Civil Code 2015.. The form of a civil transaction is an ef

NATIONAL ECONOMICS UNIVERSITY

Table of Contents

A INTRODUCTION 3

1 Reason for choosing the topic 3

2 Research purpose and tasks 4

B MAIN TOPICS 4

I. THEORETICAL BASIS OF CONTRACTS FOR THE PURCHASE OF GOODS VOID IN COMMERCIAL BUSINESS 4

1 Definition and features of the contract 4

2 Definition and characteristics of goods sale and purchase contract 5

3 Validity conditions of goods sale and purchase contracts 5

4 Overview of voidable goods sale and purchase contracts 6

5 Law governing invalid goods sale and purchase contracts 7

6 Factors affecting the establishment and settlement of invalid goods sale and purchase contracts 8

II. VIETNAM LAW ON CONTRACTS FOR THE PURCHASE OF GOODS 1 Legal grounds and the subject has the right to request the Court to declare the goods sale and purchase contract invalid 9

2 Cases in which contracts for the sale of goods are void 9

3 Legal consequences of an invalid goods sale and purchase contract 12

4. Statute of limitations for requesting the Court to declare the goods sale and purchase contract invalid 13

III. PRACTICAL APPLICATION AND SOLUTIONS TO COMPLETE LAW, ORGANIZATION FOR IMPLEMENTATION OF LAW ON VOID PRODUCTS BUY AND SELL CONTRACT 1 Practical application of current legal provisions on invalid goods sale and purchase contracts 14

2 Demand and some solutions to perfect the law, organize the implementation of the law on invalid goods sale and purchase contracts 16

C. CONCLUSION 19

A INTRODUCTION

1 Reason for choosing the topic

The general trend of the world economy today is the trend of globalization and

regionalization of international economic life Economic and commercial linkages take place

at both the global and regional levels All countries are facing this trend and are looking to integrate their economies with the world economy Vietnam has joined the integration of APTA, WTO, TPP and is facing that trend with certain great opportunities and challenges, but it can be affirmed that, in recent years, the policy of international integration has created certain advantages for the success of the national renovation cause For a long time, the contract has become a legal tool to establish the relationship of the subjects arising from civiland economic exchanges The contract has a very important role, it is reflected in most of therelationships of the parties in many fields In the current market economy, when civil and economic relations are becoming increasingly complex and expanding, buying and selling of goods is the main activity in commercial activities and is expressed in the form of contracts goods sale and purchase Contracts for the sale and purchase of goods have an important role

in the economy as well as social life such as: being a tool, the basis for formulating and implementing the business owners' own plans, and the basis for settle disputes, expand diplomatic relations with countries around the world, etc When entering into a contract, the subject wants the contract to ensure the legality of the contract for easy implementation, to ensure profit as well as to strengthen cooperation and develop partnership relationships However, for many objective and subjective reasons, the signed contract may be declared invalid To solve this problem as well as protect the legitimate rights and interests of the parties, the law has stipulated that the Sale of Goods Contract is void However, the purchaseand sale of goods is a core activity of commercial activities, which the current Commercial Law does not provide for this issue, however, it is specified in the current Civil Code as well

as the Commercial Code Civil 2015 From the above arguments, according to the author's wish, I want to evaluate the change of the Civil Code 2015 in the provisions on Contracts for the Sale of Goods as well as provisions on Contracts of Sale and Purchase of Goods Because

of chemistry in other legal documents, the author has chosen the topic: "Contracts for the sale and purchase of goods in commercial business are invalid under Vietnamese law" This

is a matter of urgent theoretical and practical significance in resolving disputes that the Sale

of Goods Contract is invalid in the current situation

2 Research purpose and tasks

The topic has the following purposes: To study the theoretical bases, analyze and evaluate the provisions of the current law and the actual application of the law, thereby offering solutions to

improve the law and organize it law enforcement agency on the contract of sale of goods is void.

- Assessing the legal status of invalid Goods Sale Contracts in commercial business

- Providing solutions to improve the law on invalid Contracts for Sale of Goods in commercial business

- Propose solutions to organize the implementation of the law on invalid Goods Sale Contracts

"contract" or "treaty" as before, but use the terms "functional", "instrumental"3 such as civil contracts, labor contracts, commercial contracts This is a special point because in the laws of many countries, people only use the term "contract" in general, but do not use the term Civil contract, Commercial contract, Labor contract in a sense specifically the law of Vietnam Unlike the 2005 Civil Code, the concept of a civil contract, the 2015 Civil Code introduces the concept of a contract in general, according to Article 385 of the 2015 Civil Code, a contract is an agreement between the parties on the establishing, changing or terminating rights and obligations between the parties to the agreement.

1.2 Features of the contract

Regardless of the field of social relations formed, a contract always has common

characteristics: a contract is an agreement on a voluntary basis of the parties to the contract, the contract generates the rights and obligations of the parties the parties to the contract, therights and obligations in the contract are mainly attached to the material interests of the contracting parties First, a contract is an agreement on a voluntary basis by the parties to the contract Second, the contract gives rise to the rights and obligations of the parties to the contract Third, the rights and obligations in the contract are mainly associated with the material interests of the contracting parties

2 Definition and characteristics of goods sale and purchase contract

2.1 Commodity trading contracts

Buying and selling goods under Clause 8, Article 3 of the Commercial Law 2005 stipulates that it is a commercial activity, whereby the seller is obliged to deliver the goods, transfer the ownership of the goods to the buyer and receive payment; the buyer is obliged to pay to the seller, receive the goods and take ownership of the goods as agreed Thus, the Goods Sale Contract is understood as follows: The Goods Sale Contract is a contract

established (or signed) between the parties (the buyer and the seller), which is satisfied in terms of form as prescribed in Clause 1 of this Article Clause 1, Article 24 of the CommercialLaw 2005, in which the subject matter of the Goods Sale Contract is the goods that are allowed to be traded in accordance with the law

2.2 Features of the contract of sale of goods

The characteristics of the Contract for the Sale of Goods can be considered in relation to the contract of sale of property according to the principle between the particular and the general In addition to the similar characteristics, the Goods Sale Contract has the following distinctive features: Firstly, on the subject matter, the Goods Sale Contract is established between the subjects who are traders Second, in terms of form, the Sale of Goods Contract can be expressed in oral form, in writing

or by specific acts of the contracting parties In certain cases, the law requires the parties to enter into a written contract, for example, an international Sale of Goods Contract must be made in writing or in another form that can be legally binding legal equivalent as telegram, telex, fax or data message Third, the subject matter of the Goods Sale Contract is goods In the usual sense, goods are products of human labor created for the purpose of satisfying human needs Increasingly, with the development of society, goods become abundant The concept of goods is specified in the laws of the current

countries, although there are certain differences, but they tend to expand the objects that are goods that are allowed to circulate.

3 Validity conditions of goods sale and purchase contracts

The conditions of validity of the Goods Sale and Purchase Contract are subject to the provisions

of the Civil Code 2005 and the Civil Code 2015 The law does not have separate provisions on the validity conditions of this contract Therefore, the valid conditions represent:

“1 A civil transaction shall take effect when the following conditions are fully satisfied:

a) Subjects have civil legal capacity and civil act capacity in accordance with established civil transactions.

b) Subjects participating in the transaction are completely voluntary.

c) The purpose and content of the transaction do not violate the prohibition of the law, and do not violate social ethics;

2 The form of a civil transaction is an effective condition of the transaction in cases where it is provided for by law”

Accordingly, it can be determined that a Contract for the Sale of Goods is valid when the following conditions are satisfied:

Firstly, the contracting party must have the legal capacity and civil act capacity in

accordance with the established civil transactions in order to perform the obligations under the contract In addition to legal capacity and civil act capacity, in practice, the parties to the contract are mainly traders Therefore, when entering into a contract of sale and

purchase for profit, traders must meet the conditions of having a legal business registration

for the goods being traded.

Secondly, the purpose and content of the contract do not violate the prohibition of the

law, do not violate social ethics

Thirdly, the voluntariness of the subjects, in entering into a contract, the parties must be

completely voluntary, which is free will in order to ensure that the validity of the contract is

in fact consistent with the genuine will of the parties Otherwise, it is no longer a contract

Fourthly, the form of the contract in accordance with the provisions of law (if so

provided by law) A contract for the sale and purchase of goods is expressed orally, in

writing or established by specific acts

For all types of goods sale and purchase contracts that are required by law to be made in writing, such provisions must be complied with Accordingly, for cases where a contract is required by law to be made in writing or in other forms of equivalent value, the parties mustcomply with the provisions of law If the parties do not make it in writing, it can be

considered as a basis for declaring the contract void

4 Overview of voidable goods sale and purchase contracts

4.1 Definition of contract of sale of goods

According to the above analysis, a Contract for the Sale of Goods is a contract established (or signed) between parties (buyer and seller), satisfied in terms of form according to the provisions of the Civil Code 2005 and the Ministry of Industry and Trade The Civil Law

2015 and the Commercial Law 2005, in which the subject matter of the Goods Sale Contract is the goods that are allowed to be traded in accordance with the law.

A voidable contract in general and a voidable Goods Sale Contract in particular

is a contract that has no effect in reality

“Non-effect means not being able to generate an effect If in the establishmentthe terms of form as well as substance are not respected, the contract shall be deemed

to have not been entered into and therefore cannot give effect at all.”

4.2 Characteristics of a contract for the sale and purchase of voidable goods Firstly, A voidable Goods Sale Contract must be a contract that violates one of

the contract's validity conditions

Secondly, A Contract for the Sale of Goods that violates the conditions of

validity may be declared void or not

Thirdly, The Sale of Goods Contract is declared invalid without giving rise to

the rights and obligations between the parties

5 Law governing invalid goods sale and purchase contracts

5.1 Legal grounds for requesting to declare the goods sale and purchase contract invalid

To determine that the Sale of Goods Contract is invalid, it must be based on the grounds prescribed by law The basis for declaring the Goods Sale Contract invalid is based on the provisions of civil law (Civil Code 2005, Civil Code 2015), specialized laws (Commercial Law), in case:

Firstly, The Goods Sale Contract violates the subject conditions prescribed by law Secondly, Contract of Sale of Goods violates the prohibition of the law.

Thirdly, Contracts for the sale of fake, deceived, and coerced Goods.

Fourthly, in some cases, violation of the formal conditions is the basis for declaring the

Goods Sale Contract to be void Regarding the form of a contract, it is basically based on the choice of the subjects, in some cases it is required by law to comply with the

conditions on the form in writing and in writing notarized..

5.2 Declare the contract of sale and purchase of goods invalid and deal with the legal consequences

- Declaring the Goods Sale Contract to be void: When there are sufficient grounds, the Court shall apply the provisions of civil law and commercial law to declare the GoodsSale Contract invalid The time when the Sale of Goods Contract is invalid is counted from the time of entering into the contract and does not give rise to the rights and obligations of the parties However, before the time the contract is declared invalid, the subjects have performed their

obligations under the contract, so they must deal with the legal consequences of the invalid

- “Return to each other what has been received”: Returning to each other what has been received is considered as a specific principle when dealing with the consequences of a void contract in general and a contract for the sale of voided Goods private This case only applies when the assets are goods that can be returned to each other In case the goods no longer exist, the monetary value shall be calculated for payment However, in our opinion, when solving, the machine should not be in the same way

as the law In case the goods still exist but the parties agree to pay each other in cash, it is still accepted.

In addition to the goods that are the subject of the contract, there are goods created in the process of operation such as yields and profits, which are also considered reasonable to deal with

6 Factors affecting the establishment and settlement of invalid goods sale and purchase contracts

Firstly, the legal document is not complete and there is no consensus

Second, many regulations are not scientific and unreasonable.

Third, Vietnamese law is not compatible with international law.

Fourth, due to the ignorance of the law of the parties involved in the

establishment of the Sale of Goods Contract, specifically:

- Subjects directly enter into contracts

8

- Form and content of the contract

- The basis for entering into the contract

II. VIETNAM LAW ON CONTRACTS FOR THE PURCHASE OF GOODS

1 Legal grounds and the subject has the right to request the Court to declare the goods sale and purchase contract invalid

1.1 Legal grounds:

Firstly, the Civil Code 2005 and the Civil Code 2015 (approved on November

24, 2015 and took effect on January 1, 2017) Second, Commercial Law 2005.

Third, Enterprise Law 2020.

Fourth, other relevant legal documents.

In addition to the legal documents governing the invalid Goods Sale Contract, there are also documents that are: Decree 59/2006/ND-CP dated June 12, 2006 guiding the implementation of the Commercial Law on goods , business ban services, business restrictions and conditional business…

1.2 The subject has the right to request the Court to declare the goods sale and

purchase contract invalid

The subject has the right to request the Court to declare a civil transaction invalid ingeneral, which also applies to the Sale of Goods Contract in particular and is

regulated in each specific case:

Firstly, the subject is the legal representative of one or the parties to the contract Second, the buyer and seller in the Goods Sale Contract.

2 Cases in which contracts for the sale of goods are void

• The contract of sale and purchase of goods is invalid because it violates the

prohibition of the law or is against social morality

So what is prohibited by law? Those are the provisions of the law that do not allow the subject to perform certain acts

Regarding social ethics, it is not a legal concept, it depends on many factors such as culture, history, economy Social ethics are common standards of behavior between people in life social life, recognized and respected by the community Behavior contrary to those standards can

clearly stated in the content of Article 128 of the 2005 Civil Code, and are

specifically repeated in accordance with Article 123 of the 2015 Civil Code

In principle, a contract that violates a legal prohibition is understood as a contract that violates a mandatory legal norm, which is generally drafted in the form of a

prohibition to do something, or as a form of not doing or have to do something

However, according to the provisions of the Civil Code as above, which is "not

allowing the subject to perform certain acts", can it be said that the rules of command written in the form of having to do something are not considered? is prohibited by law and therefore a breach of these terms does not result in the contract being void?

• The contract of sale of goods is invalid due to forgery

According to the Civil Code 2005 and the Civil Code 2015 of Vietnam stipulates:

“When the parties artificially establish a civil transaction in order to conceal another civiltransaction, the fake transaction is invalid, and the The concealed transaction is still valid,unless such transaction is also invalid under the provisions of this Code In case a faketransaction is established in order to evade obligations towards a third party, such civiltransaction shall be void So, a fake civil transaction is a transaction in which the outwardexpression of will is different from the inner will and results of the parties to thetransaction To put it simply, a fake civil transaction is a transaction with establishedcontent that does not reflect the true will of the parties According to the aboveprovisions, fake transactions have the following cases:

First, the contract is created artificially to conceal another contract.

Second, a sham contract to evade obligations to a third party.

• An invalid goods sale and purchase contract has been established and performed by a minor, a person who has lost his/her civil act capacity, a person with difficulties in

perception and behavior control, or a person with limited civil act capacity

Accordingly, the Contract for the Sale of Goods is established by a minor, a personwho has lost his/her civil act capacity, a person with difficulties in perception or

behavior control, or a person with limited civil act capacity the performance is not invalidated in some of the following cases:

“a) A civil transaction of a person under the age of six or a person who has lost

his/her civil act capacity in order to meet that person's daily essential needs;

b) Civil transactions only give rise to rights or only relieve obligations for minors, persons who have lost their civil act capacity, people with difficulties in cognition or behavior

control, persons with limited capacity for civil acts force civil acts against people

who have established and performed transactions with them;

c) A civil transaction is recognized by the transaction maker after becoming an adult or after having restored his/her civil act capacity.”

• The contract of sale of goods is invalidated due to a mistake

According to the provisions of Article 126 of the Civil Code 2015: “In case a civiltransaction is established with a mistake that causes one or the parties to fail to achievethe purpose of the transaction, the mistaken party may the right to request the Court todeclare the contract invalid, except for the case specified in Clause 2 of this Article”.Thus, the understanding of Vietnamese law about confusion is due to the negligence of one party, but in fact, both parties want to sign this contract seriously and legally

• The sale and purchase contract is void due to deception, threat, or coercion Firstly, the

Contract for the Sale of Goods is void due to deception.

However, not every act of intentionally giving false or untrue information is considered cheating and determining whether or not deception exists in the conclusion of a contract must have two things Facts: One is that one party must use tricks to deceive others, and the other is that the other party must obey and follow something For example, the fact that a salesperson makes a false introduction about his goods or the seller says the price is too high is not considered cheating, because in this case, the person receiving the information is not forced to

have to sign a contract if they don't want to.

Second, the Goods Sale Contract is void due to threats or coercion In the

common sense, intimidation is when a person uses his or her actions or words toinfluence another person to make people afraid and reluctant to do what they want

• A contract for the sale and purchase of goods is void because the person who

establishes it is not aware of and controls his or her behavior

According to Article 133 of the 2005 Civil Code and Article 128 of the 2015 Civil Code:

“A person who has civil act capacity but has established a transaction at the right time is notaware and does not control his/her behavior, request the Court to declare that civil

transaction invalid”

In the case of property sales, the buyer's capacity is also considered at the time he decides

to buy, if at the time of receiving the seller's offer he has full capacity, but when deciding to