Force majeure in Vietnam: definition, exemption from liability and clause drafting

What is force majeure in Vietnam under the Civil Code 2015?

A force majeure event is an event that occurs objectively, could not be foreseen and cannot be overcome even though every necessary measure within the party's means has been taken. That is the wording of Clause 1, Article 156 of the Civil Code 91/2015/QH13. Two points about where the definition sits. First, it is in the article on time that does not count toward limitation periods, not in the part on liability for breach. Second, Clause 2, Article 351 and Article 294 of the Commercial Law use the term without defining it again; in consolidated text 113/VBHN-VPQH of the Commercial Law, Article 3 (definitions) has no entry for it. So the three elements of Article 156 are the working yardstick for both civil and commercial contracts; that is the approach LexData follows, since no provision refers to it directly. Some sector laws, such as the tax law, have their own definition for their own purposes (see the situations table below).

Clause 1, Article 156 also has a separate concept, the objective obstacle: an objective circumstance that makes a person with a civil right or duty unable to know their right has been infringed or unable to exercise the right or perform the duty. It is a lighter test (no need for "unforeseeable" or "cannot be overcome") but it appears only in the article on limitation periods. The articles that excuse liability, Article 351 of the Civil Code and Article 294 of the Commercial Law, speak only of force majeure, so on their wording an objective obstacle is not a ground of exemption.

Effect on the limitation period. Time during which a force majeure event or objective obstacle prevented the right holder from suing within the period does not count toward the period (Clause 1, Article 156). The limitation period for contract claims is 3 years from the day the right holder knew or should have known that their lawful rights were infringed under the Civil Code (Article 429), and 2 years from the moment the lawful rights and interests were infringed for commercial disputes (Article 319 of the Commercial Law, except in the case of Point e, Clause 1, Article 237 for logistics services). The two periods start from different moments. The Commercial Law has no separate rule on time that does not count; applying Article 156 to the 2-year period rests on Clause 3, Article 4 (the Civil Code applies to matters the Commercial Law does not cover) and is a reading of the two provisions together.

Force majeure in Vietnam in commercial contracts: what is exempt, and how to notify and prove it?

Clause 2, Article 351 of the Civil Code sets the general rule: an obligor that fails to perform properly because of force majeure bears no civil liability, unless the parties agree otherwise or the law provides otherwise. For commercial activity, Article 294 of the Commercial Law 36/2005/QH11 lists four cases of exemption for a party in breach:

1. an exemption the parties have agreed (Point a, Clause 1);
2. a force majeure event (Point b);
3. breach caused entirely by the other party's fault (Point c);
4. breach caused by carrying out a decision of a competent state authority that the parties could not have known of when they signed (Point d).

Point d is a separate ground: the party relying on it need not prove that the decision was itself force majeure, only that the breach resulted from carrying out a competent authority's decision of which the parties could not have known at signing. Point a is also separate, and is exactly where a force majeure clause in the contract operates, because it is the parties' agreed exemption.

What exemption does. Penalties (Article 300), liability for damages (Article 303), suspension (Article 308), termination (Article 310) and cancellation of the contract (Clause 4, Article 312) all apply "except in the cases of exemption" under Article 294. The other side therefore cannot use those remedies against an exempt party. On penalty amounts and how they interact with damages, see penalty for breach of contract in Vietnam.

Article 295 leaves two points open. The law does not say whether failing to notify promptly when the event occurs forfeits the exemption (the damages consequence is stated for failing to notify when the event ends). And on "in writing": the Commercial Law treats telegram, telex, fax, data messages and other forms as having equivalent value to writing (Clause 15, Article 3), but Article 295 says only "in writing". The Civil Code (Clause 1, Article 119) treats a civil transaction made by data message under the law on electronic transactions as made in writing, but the law does not say whether this applies directly to a notice under Article 295. In practice, send a signed letter together with an email, keep proof of dispatch and receipt, and state in the contract the email address for notices. For late performance in general, the Civil Code also requires immediate notice to the creditor, and failure to give it means paying the resulting damage unless the parties agree otherwise or an objective cause made notice impossible (Clause 2, Article 353; Clause 1, Article 354).

Which events count as force majeure in Vietnam? Price rises, supply problems, epidemics, government measures

The law contains no list of events. The table records what the texts say and a reading; the "reading" column is LexData's view, not a rule.

Some contracts and fields have their own rules, so the general rule should not be relied on alone. The Civil Code says a carrier is not liable for compensation when the goods are lost, damaged or destroyed in transit because of force majeure, unless the parties agree otherwise or the law provides otherwise (Clause 3, Article 541); a custodian is not liable for loss or damage to goods kept for the depositor caused by force majeure (Clause 4, Article 557); and a lessee under a khoan lease (a lease of an asset to exploit it and take its yield) may ask for a reduction or waiver of the rent if at least one third of the yield is lost to force majeure, unless the parties agree otherwise (Clause 3, Article 488). The Labour Code allows an employer, for force majeure reasons and after trying every remedy, to pay wages late by no more than 30 days, with compensation due if the delay is 15 days or more (Clause 4, Article 97).

What happens to the contract under force majeure in Vietnam: suspend, extend or terminate?

The law gives no single outcome. A contract does not end automatically because of force majeure; the result depends on the parties' agreement and the type of contract.

Under the Commercial Law (Article 296). The parties may agree to extend the time for performance. If they have no agreement or cannot reach one, the time is extended by the duration of the event plus a reasonable time to remedy its effects, but by no more than:

• 5 months, for goods or services whose agreed delivery or performance period is no more than 12 months from signing;
• 8 months, where the agreed period exceeds 12 months from signing.

If the extension goes beyond those limits, either party may refuse to perform and neither may claim damages from the other (Clause 2). The party refusing must notify the other within no more than 10 days from the end of the period stated in Clause 1 (5 or 8 months), before the other side starts to perform (Clause 3); the law does not say precisely how that start date is fixed, so proceed with care. This extension mechanism does not apply to sale and service contracts with a fixed time for delivery or completion (Clause 4); the law does not say what happens then, which is a reason for a bespoke clause in such contracts. The law is also unclear on whether the 5- and 8-month ceilings apply to an extension the parties agree themselves or only to the default rule; the wording of Clause 1 places the ceilings straight after the default rule.

Under the Civil Code. No article provides that a contract ends on force majeure. The available routes are an agreement to terminate or amend (Clause 2, Article 422; Clause 1, Article 421); impossibility because the subject matter no longer exists (Clause 5, Article 422); or cancellation by the creditor where the obligor cannot perform and the creditor's purpose can no longer be achieved (Article 425, which also mentions a claim for damages). An obligor who cannot perform because of force majeure is still exempt from liability under Clause 2, Article 351; combining the two articles is LexData's reading. For commercial contracts, Clause 4, Article 312 of the Commercial Law does not allow the remedy of cancellation against a party exempt under Article 294. The articles checked have no separate rule for payment obligations during force majeure, so a contract usually states whether payment obligations fall under the clause.

Force majeure in Vietnam versus hardship (Article 420): what is the difference?

This is where many articles and many contracts blur the line. Force majeure is about being unable to perform. Change of fundamental circumstances is about performance that, unchanged, has become seriously harmful, though not necessarily impossible.

Practical consequence: if raw material prices jump, a party that simply invokes "force majeure" and stops delivering risks being rejected on the "cannot be overcome" element and also being in breach of the duty to keep performing. Article 420 says either side may ask the court (Clause 3); the article does not say how it works where the contract has an arbitration clause, so the dispute resolution clause should anticipate this. A long-term contract usually benefits from a separate renegotiation clause, distinct from the force majeure clause.

How to draft a force majeure clause for a contract in Vietnam

The law allows the parties to agree otherwise on force majeure (Clause 2, Article 351 of the Civil Code; Point a, Clause 1, Article 294 and Clause 1, Article 11 of the Commercial Law). The table separates what the law says from drafting practice; items marked "practice" are LexData suggestions, not legal requirements.

If you need a force majeure clause drafted or reviewed together with penalties, damages and termination, see our service on commercial contracts in Vietnam.

Force majeure in Vietnam for contracts with a foreign element and FDI companies

For foreign-invested companies (see what is an FDI company in Vietnam), three points are often missed:

1. The governing law decides the test. A civil relationship with a foreign element includes cases where at least one party is a foreign individual or legal entity, or where all parties are Vietnamese citizens or legal entities but the relationship is created, changed, performed or ended abroad, or its subject matter is abroad (Clause 2, Article 663 of the Civil Code). An FDI company set up in Vietnam is usually a Vietnamese legal entity, so a contract with a Vietnamese counterparty performed entirely in Vietnam usually has no foreign element, and the right to choose foreign law described below may not apply; a contract with the parent company or a foreign counterparty does have one. The parties may choose the law that governs the contract, except in the cases the law carves out (Clause 1, Article 683); and a commercial transaction with a foreign element may choose foreign law or international commercial practice if it does not contradict the fundamental principles of Vietnamese law (Clause 2, Article 5 of the Commercial Law). If the contract chooses foreign law, whether an event is force majeure is answered under that law and the contract, not Article 156, and counsel qualified in that jurisdiction should confirm it.
2. Group template contracts. A parent company's force majeure clause still works as the parties' agreement (Point a, Clause 1, Article 294), but check it against Article 295 (written notice) and Article 296 (if Vietnamese law governs), and keep the terminology consistent between the Vietnamese and English versions. A bilingual contract needs a prevailing-language clause.
3. Investment projects. The Law on Investment 143/2025/QH15 allows the schedule of a project that has received investment policy approval to be adjusted by more than 24 months in order to remedy the consequences of force majeure "under the law on civil matters and the law on land" (Point a, Clause 4, Article 33). This refers to civil law (which includes Article 156) and land law; land guidance may identify the events in its own way, and this entry has not checked it. An investor that suspends a project must notify the investment registration authority in writing; if it suspends because of force majeure, the State exempts it from land rent and reduces land use fees for the period of suspension needed to remedy the consequences of force majeure (Clause 1, Article 35). The implementing procedures and supporting documents are not covered in this entry and LexData has not checked them here; see investment registration certificate (IRC) in Vietnam on adjusting a project.

Checklist when an event may be force majeure

1. Read the force majeure clause, the governing law and the notice clause at once, and send notice within the period the contract requires, no later than the "immediately" of Article 295.
2. Identify the specific obligation affected and test the three elements: objective, unforeseeable, cannot be overcome.
3. Send written notice immediately stating the event, the affected obligation, likely consequences and expected duration; the signatory must have authority (see what is a legal representative in Vietnam).
4. Collect and keep evidence at once: state authority documents, third-party notices, transport records, photographs, emails, dates and times.
5. Record the workarounds tried (alternative sources, routes) and why they failed.
6. Notify immediately when the event ends (Clause 2, Article 295) and resume performance.
7. Check whether the situation fits Article 420 better than force majeure; if so, send a written request to renegotiate and keep performing.
8. For a commercial contract, watch the 5- or 8-month ceiling and the notice of no more than 10 days from the end of the period in Clause 1 if you intend to refuse performance (Article 296; the law is not precise on the start date).
9. Keep limitation periods in view (2 years from the infringement for commercial disputes, 3 years from when the right holder knew or should have known for civil contracts) and note that time during which force majeure prevented suing may not count (Article 156).

Common mistakes

• Invoking force majeure for performance that has merely become costlier. Price, exchange-rate and logistics cost rises rarely meet "cannot be overcome".
• Naming the event without proving the link between the event and the failure to perform a specific obligation.
• Failing to give immediate written notice, or relying on phone calls and messages, then not giving notice when the event ends (Clause 2, Article 295).
• Suspending all obligations when the event affects only part, or when an alternative could be used.
• Copying a foreign force majeure clause into a contract under Vietnamese law without checking it against Articles 295 and 296.