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Vietnamese businesses weeping, unable to recover debts
More and more Vietnamese businesses have complained that their foreign partners have repudiated debts, while some others have been bankrupted since the end of 2008.
Managing Director of a HCM City-based garment export company related that at the end of 2008, his company exported a consignment of US $850,000 to the UK-based Bianca Alena. As soon as hearing about the bankruptcy of the British company, his company has been trying to contact relevant parties to claim the debt. However, his company’s debt claim has not been successful.
The director said that he knows that Bianca Alena is still owing to many other domestic garment export companies (upwards to US $850,000), including Dong Tien, Tien Tien, and fibre suppliers.
T, the owner of a workshop, specializing in making jeans for export in the southern province of Binh Duong, related that he still cannot get the payment for the consignment worth US $10,000 he delivered late last year. T said that he has realized that the partner is on the verge of bankruptcy due to the global economic recession.
Agifish, a seafood import export, said that its main export markets in the last year were Russia and China, which did not suffer too heavy losses from the recession. Therefore, no partner has escaped from their debts. However, Agifish said that the foreign partners have been late in making payment due to the fluctuations in the exchange rates between the dollar and the local currencies.
Experts said that it is very difficult to recover debts from the bankrupted foreign partners, since the total assets left after the dissolution proved to be very small. As Vietnamese companies did not make legal procedures in signing contracts (the contracts were just verbal, or sent via email), they cannot show any legal basis to bring the disputes to the courts.
The Director of a seafood company in An Giang province, who needs to recover several billions of VND worth of debts from a foreign partner, said that the company is going to take legal proceedings to claim for the debt.
However, Vietnamese businesses only take legal proceedings if the debts are big. Meanwhile, they would rather lose the sums of money than having to spend money on lawyers and travel. That explains why only a few of enterprises bring the cases to the foreign courts.
T. said that the expenses he would have to pay to follow the lawsuit will be even higher than the sum of money he expects to recover.
The lack of knowledge about the legal system of the foreign countries also proves to be the hindrance for Vietnamese businesses.
Wui John, a lawyer from the Viet Law Office, said that Vietnamese businesses sometimes did not care much for legal provisions when signing contracts. In other countries, businesses hired lawyers to protect their interests, while Vietnamese businesses only hire lawyers to settle disputes.
He has advised export companies to list the debts and report about the debts to the Ministry of Industry and Trade, or Vietnam Chamber of Commerce and Industry, asking for help.
VietNamNet, VnMedia
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