Vietnamese court upholds Vinalines $3m payment to S. Korean firm

October 22, 2014 | 16:23

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The Hanoi People’s Court has ruled that Vinalines must pay $3 million to South Korean firm SK Engineering & Construction (SK E&C), upholding the decision made by Vietnam International Arbitral Centre (VIAC) regarding the dispute between the two firms.

According to Decision No. 09/2014/QD-PQTT, dated October 3, on Vinaline’s appeal of the VIAC’s decision, Vinalines is obligated to pay SK VND65.26 billion ($3 million) plus interest.

Vinalines must transfer the amount by November 2 this year and if it fails to do so SK can pursue enforcement proceedings.

Vinalines has attempted to negotiate with SK on the issue and the terms of the contract.

According to the VIAC’s decision, Vinalines is required to pay the aforementioned sum to SK in its capacity as a contractor in the B1 package of the first phase of international transshipment terminal Van Phong for a batch of steel pipes the firm shipped to the construction site before the project was suspended for planning adjustments in 2012.

According to VIAC, based on documents submitted by SK E&C, Vinalines failed to fulfill the terms of the contract when it refused to make payment for the pipes.

Vinalines later appealed to the Hanoi People’s Court, saying it could not make payment because the documents were not in order and the pipes did not meet quality requirements.

In March 2014, after VIAC submitted its ruling, South Korea detained two Vinalines ships, namely Vinalines Sky and Vinalines Trade to force the company to make good on its agreement.

By By Anh Minh

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