HA NOI: Vietnam National Oil and Gas Group, better known as Petro Vietnam, announced it had won a major tax incentive dispute over a production-sharing contract for a Vietnamese offshore oil concession.
In the press release, Petro Vietnam said the plaintiffs asserted “they were impliedly entitled to benefit from certain tax incentives, which had not been the subject of negotiations and were not stated in the relevant production-sharing contract or investment licence.”
PetroVietnam declined to disclose information about the plaintiffs. The dispute was resolved through international arbitration.
An international arbitral tribunal, constituted under the arbitration rules of the International Chamber of Commerce (ICC), upheld PetroVietnam’s position in the case and rejected all claims against the Vietnamese company.
In an award issued on May 22, 2015, the tribunal found that in the present case, the plaintiffs could not benefit from the tax incentives “since they had not been negotiated for and had not been specifically approved by the competent Vietnamese authorities.” The tribunal ordered the plaintiffs to reimburse PetroVietnam’s full costs of arbitration.
PetroVietnam Chairman Nguyen Xuan Son said in the press release, “We are very pleased with the tribunal’s decision. It recognises PetroVietnam’s longstanding openness to negotiation with partners and its willingness to support foreign contractors in their dealings with the competent Vietnamese authorities.”
He said the decision confirmed Vietnamese production-sharing contracts should be applied as agreed and in accordance with their terms.
