Stakeholders urged to consult arbitrators in PPP project disputes
Arbitrators need to step in and deal with disputes in public-private-partnership (PPP) projects so economic development will not be disrupted, experts have warned.
The workshop on contractual disputes in infrastructure PPP projects taking place on July 4 in Hanoi. (Photo: thoibaotaichinhvietnam.vn)
Hanoi (VNS/VNA) -💮 Arbitrators needto step in and deal with disputes in public-private-partnership (PPP) projectsso economic development will not be disrupted, experts have warned.
Vietnam has encouraged PPP projects inrecent years to meet the demand for energy and infrastructure development inthe context of limited State budget. According to Vice Chairman of the VietnamChamber of Commerce and Industry Hoang Quang Phong, as of January 2019, 336 PPPproject agreements were signed with the total capital raised reaching 1.6quadrillion VND (68.8 billion USD). The figure consisted of 140build-operation-transfer (BOT) projects and 188 build-transfer (BT) projects. Do Trong Hai, director of the law firmBizlink, said disagreements and conflicts might arise between governmentagencies, investors and people when carrying out a PPP project. “Disputes must be resolved shortly so thatthey don’t escalate, assuring the PPP project is carried out quickly and has nonegative impact on the nation’s general business environment,” Hai told atwo-day seminar that took place in both Hanoi and HCM City on July 4-5. Stakeholders should bring the case to thearbitrator as this is an effective way to deal with conflicts, Phan Trong Dat,deputy general secretary of the Vietnam International Arbitration Centre, toldthe conference. “Arbitration is secure, flexible, lesstime-consuming and cost-saving,” Dat said, adding that experiences in developedcountries have proven arbitration can lessen the tensions in PPP projects.Therefore, cases may not be brought to the court. Professor Pham Duy Nghia at Fullbright VietnamUniversity said attracting private investment was good for infrastructuredevelopment. “However, PPP projects often have longlife cycles, so risks will come along,” he said, adding risks were related tolegal framework, finance, tax and management. “Risks increase spending on projects. Itmay not only result in losses for stakeholders but also create disputes,leading to the delay, or even worse, the cancellation of the projects.”
In order to limit the risks, there are twosolutions, according to Nghia. One is to forecast potential risks whenstakeholders prepare mutual contracts.
📖 A PPP project often lasts for 20-30 years.During the period, the regulations and policies could change so there must beappropriate measures to make sure stakeholders would not suffer, Nghia said.
"The second solution is selectingarbitrators to resolve disputes," he added. “If investors are unaware ofthe administrative procedures, it may prolong the implementation plan and createmore risks for both private investors and State agencies.” — VNS/VNA
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The workshop on contractual disputes in infrastructure PPP projects taking place on July 4 in Hanoi. (Photo: thoibaotaichinhvietnam.vn) 
