Court or Arbitration: Which Is Faster and Cheaper?

When a contract breaks down, the first question most businesses ask is not "who is right" but: is court litigation or arbitration faster and cheaper? This article answers the 11 questions FLAT Law Firm's clients ask most often, with current legal authority and concrete cost figures so businesses can weigh the options before deciding.

1. Straight answer: is court litigation or arbitration faster and cheaper?
2. At what dispute value should I choose arbitration, and when should I go to court?
3. If my contract has no arbitration clause, can I still go to arbitration?
4. How long does court litigation take before I get an enforceable judgment?
5. How long does arbitration take before I get an award?
6. How are court fees calculated when I sue?
7. How are arbitration fees calculated, and who pays them?
8. Does an arbitral award carry the same weight as a court judgment?
9. Are there cases where I must go to court and cannot choose arbitration?
10. Can I switch from court to arbitration mid-case, or vice versa?
11. Is hiring a lawyer for arbitration more expensive than for court litigation?

1. Straight answer: is court litigation or arbitration faster and cheaper?

Short answer: There is no one-size-fits-all answer. On speed, arbitration is usually faster thanks to single-instance proceedings and a flexible timetable agreed by the parties. On fees payable to the dispute-resolution body, court fees are normally lower than arbitration fees — especially for high-value disputes.

Explanation: Courts work in two instances — first instance and appeal — each with statutory deadlines plus the real-world waiting time caused by heavy caseloads. By contrast, an arbitral award is final: issued once, with no appeal. That single-instance feature is what shortens the total timeline in arbitration. On cost, the state collects court fees at fixed, relatively low rates, while arbitration centres operate as a service, charging fees based on the dispute value to pay arbitrator remuneration and operating costs — usually several times higher than court fees.

Legal basis: Article 61 of the Commercial Arbitration Law (Luật Trọng tài thương mại) 2010 (consolidated text 60/VBHN-VPQH) provides that arbitral awards are final and take effect from the date of issuance; Article 34 of the same law covers arbitration fees; Resolution 326/2016/UBTVQH14 covers court fees and charges.

Next step: Before choosing, answer three questions: what is the dispute worth, is there a foreign element, and does the contract already contain an arbitration clause? Those three answers determine 80% of the right choice.

2. At what dispute value should I choose arbitration, and when should I go to court?

Short answer: For small disputes — tens to hundreds of millions of VND — courts are usually far cheaper because court fees are low. For large, complex, or cross-border disputes, arbitration is often worth the cost thanks to speed, confidentiality, and cross-border enforceability.

Explanation: For a VND 100 million dispute, the first-instance court fee is only about VND 5 million, with half advanced up front; the arbitration fee for the same dispute value at a domestic centre can reach tens of millions of VND — a several-fold gap that makes little sense for a small case. Conversely, for a dispute worth tens of billions of VND, arbitration fees may run into the hundreds of millions, but in return the business gets to choose arbitrators who understand the industry, keeps business information confidential (arbitration hearings are not public), and obtains a final award in a single proceeding instead of dragging through two court instances.

Legal basis: Article 24 of Resolution 326/2016/UBTVQH14 sets progressive first-instance civil court fees based on dispute value; Article 34 of the Commercial Arbitration Law 2010 sets the principle that arbitration fees follow the dispute value.

Next step: Build a two-column cost comparison for your own case (see questions 6 and 7 for the calculation methods), then add the time and confidentiality factors before deciding.

3. If my contract has no arbitration clause, can I still go to arbitration?

Short answer: Yes — if, after the dispute arises, the parties sign a separate arbitration agreement. Without an arbitration agreement in any form, court is the only route.

Explanation: The prerequisite for arbitral jurisdiction is the parties' agreement — it may be an arbitration clause already written into the contract, or a separate agreement signed after the dispute has arisen. Many businesses wrongly assume that "no clause in the contract means no arbitration", but the parties can perfectly well sit down and agree on arbitration even when the original contract is silent. The key point is that the agreement must be mutual; one party cannot unilaterally force the other into arbitration.

Legal basis: Article 16 of the Commercial Arbitration Law 2010 provides that an arbitration agreement may take the form of an arbitration clause in the contract or a separate agreement; Article 2 of the same law covers arbitral jurisdiction.

Next step: If your contract lacks an arbitration clause but you prefer this route, propose it in writing and keep a record of the entire negotiation. Also read our in-depth piece "Drafting arbitration clauses in commercial contracts" so next time the right clause goes into the contract from the start.

4. How long does court litigation take before I get an enforceable judgment?

Short answer: The law gives courts 2 months from case acceptance to prepare a business or commercial case for first-instance trial, after which the hearing must be opened within 1 month of the decision to bring the case to trial. In practice it usually takes longer, and an appeal adds an entire appellate phase.

Explanation: That 2-month figure covers only trial preparation — the judge studies the file, takes statements, and organises conciliation. Complex cases get a 1-month extension. After the decision to bring the case to trial, the court opens the hearing within 1 month (2 months for justifiable reasons). But that is the theory: in practice, the time from filing to acceptance, suspensions pending expert assessment or a related case, and then the wait for an appellate hearing if one party appeals, can stretch a commercial dispute to 12–24 months or more.

Legal basis: Article 203 of the Civil Procedure Code (Bộ luật Tố tụng dân sự) 2015 (consolidated text 99/VBHN-VPQH) on trial-preparation periods; the appellate procedure rules in Section 2, Chapter XVII of the same code.

Next step: When planning cash flow for a lawsuit, budget on the real-world scenario, not the statutory deadlines, and allow for the possibility that the defendant appeals. Our article "Commercial dispute litigation in Vietnam — the full A-to-Z process" walks through each step.

5. How long does arbitration take before I get an award?

Short answer: The Commercial Arbitration Law sets no overall time limit for resolving a dispute, but the award must be issued no later than 30 days after the final hearing session. In practice, cases at domestic centres typically take 4 to 8 months.

Explanation: Unlike courts, arbitration has no statutory "clock" for the whole proceeding — timing depends on the chosen centre's rules, the schedule set by the arbitral tribunal, and the parties' cooperation. The decisive speed factor is finality: a single proceeding, with no appeal and no prolonged supervisory review. Still, do not mistake arbitration for instant justice: a complex case with several rounds of written submissions, technical expert assessment, and three arbitrators' busy calendars can still run for a year.

Legal basis: Article 61(3) of the Commercial Arbitration Law 2010: the award is issued at the hearing session or no later than 30 days after the final session ends; Article 61(5): awards are final.

Next step: When filing, ask the centre for an indicative timetable and the applicable procedural rules (e.g. the VIAC Rules), and proactively propose early hearing dates to the tribunal right after it is constituted.

6. How are court fees calculated when I sue?

Short answer: First-instance civil court fees for valued claims are progressive on the disputed value, starting at VND 300,000; the claimant advances 50% of the estimated first-instance fee when the court accepts the case. The losing party bears the court fees, except that fees are halved where conciliation succeeds.

Explanation: The scale works like this: disputes up to VND 6 million pay VND 300,000; from over VND 6 million to VND 400 million, 5% of the dispute value; from over VND 400 million to VND 800 million, VND 20 million plus 4% of the amount above VND 400 million; higher bands continue progressively at declining rates. Example: for a VND 1 billion dispute, the first-instance court fee is VND 36 million plus 3% of VND 200 million — VND 42 million — and the claimant advances VND 21 million on acceptance. Beyond court fees there are other litigation costs such as expert assessment, valuation, and interpretation — since 1 July 2025 these follow the Ordinance (Pháp lệnh) on Litigation Costs No. 05/2024/UBTVQH15.

Legal basis: Articles 7, 24, and 25 of Resolution 326/2016/UBTVQH14; Article 3 of Ordinance 05/2024/UBTVQH15 lists 9 categories of litigation costs.

Next step: Before filing, calculate the fee advance using the progressive bands so your budget is ready, and note the 7-day deadline to pay it after receiving the court's notice — miss it and your petition may be returned.

7. How are arbitration fees calculated, and who pays them?

Short answer: Arbitration fees are set by the arbitration centre according to a schedule based on the dispute value, covering arbitrator remuneration and the centre's administrative costs. The losing party bears them as a rule, unless the parties agree otherwise or the tribunal allocates them differently.

Explanation: Each centre publishes its own fee schedule, usually progressive like court fees but at substantially higher levels. For illustration: under the fee schedule published in June 2025 by the Vietnam Commercial Arbitration Centre No. 1, a VND 1 billion dispute heard by a three-arbitrator tribunal carries arbitration fees of about VND 84 million (excluding VAT and administrative charges), while the court fee for the same value is only about VND 42 million. On filing, the claimant must advance the full arbitration fee as required by the centre; failure to pay in full within the set deadline means the claim is deemed withdrawn. At the end of the case, the tribunal allocates the fees in the award — normally the loser pays all, but the tribunal may split them in proportion to each party's partial wins.

Legal basis: Article 34 of the Commercial Arbitration Law 2010 on arbitration fees: set by the arbitration centre, borne by the losing party absent agreement or different allocation; Articles 39 and 40 of the VIAC Arbitration Rules on fee components and payment obligations.

Next step: Before choosing a centre, download the current fee schedule from its official website and calculate the exact figure for your dispute value — schedules differ between centres and are revised over time.

8. Does an arbitral award carry the same weight as a court judgment?

Short answer: Yes. An arbitral award is final, takes effect from the date of issuance, and is enforced like a court judgment that has taken legal effect. A court may only set it aside on the specific grounds listed by law, without re-examining the merits.

Explanation: This is the most common misconception: that because arbitration is "private", its awards are weaker than court judgments. In reality, if the losing party does not voluntarily comply, the winning party can ask the civil judgment-enforcement agency to enforce the award just like an ordinary judgment. The losing party may only ask a court to set the award aside within 30 days on narrow grounds — no arbitration agreement, an invalid agreement, an improperly constituted tribunal, or a serious procedural violation — and the court may not revisit who was right on the merits. For foreign arbitral awards, recognition and enforcement in Vietnam go through the courts under the Code of Civil Procedure.

Legal basis: Article 61(5) of the Commercial Arbitration Law 2010 (awards are final, effective from issuance); Articles 68 and 69 of the same law on grounds and time limits for setting aside arbitral awards.

Next step: If you win by arbitration and the other side stalls, start enforcement proceedings as soon as the voluntary-compliance period in the award expires. See our article "Recognition and enforcement of foreign arbitral awards in Vietnam" for awards from foreign centres.

9. Are there cases where I must go to court and cannot choose arbitration?

Short answer: Yes. Commercial arbitration may only hear disputes arising from commercial activities, disputes in which at least one party engages in commercial activities, or other disputes permitted by law — and there must always be an arbitration agreement. Outside that scope, or without an agreement, jurisdiction belongs to the courts.

Explanation: Typical examples: a purely private land dispute between individuals with no commercial activity, matrimonial matters, or challenges to administrative decisions — a commercial arbitration centre cannot hear these no matter how much the parties wish. Even in business, if the contract has no arbitration clause and the parties reach no separate agreement after the dispute arises, litigation in court is the default. One practical note for FDI businesses: disputes between a foreign investor and a Vietnamese state authority over investment incentives generally fall outside domestic commercial arbitration.

Legal basis: Article 2 of the Commercial Arbitration Law 2010 on arbitral jurisdiction; Article 30 of the Code of Civil Procedure 2015 on business and commercial disputes within court jurisdiction.

Next step: When reviewing contracts, first determine whether the relationship is genuinely commercial before inserting an arbitration clause — a clause placed in the wrong context may be declared invalid, wasting time and money.

10. Can I switch from court to arbitration mid-case, or vice versa?

Short answer: If a valid arbitration agreement exists and one party still files in court, the court must refuse to accept the case. Conversely, where the parties have chosen the courts (or the arbitration agreement is invalid), the tribunal has no jurisdiction — you cannot hop back and forth at will.

Explanation: The principle is mutually exclusive jurisdiction: one dispute, one forum. When the respondent proves a valid arbitration agreement exists, the court issues a decision suspending or refusing the case, and the matter moves to arbitration. But if the arbitration agreement is invalid (for example, signed under duress, or covering a dispute outside arbitration's scope), or the parties have agreed in writing to choose the courts, the tribunal must decline. In practice, these "jurisdiction battles" are common: one party sues in court to buy time while the other triggers arbitration — the outcome turns entirely on the validity of the arbitration agreement.

Legal basis: Article 6 of the Commercial Arbitration Law 2010 on courts refusing cases covered by an arbitration agreement; Article 192 of the Code of Civil Procedure 2015 on returning petitions.

Next step: As soon as you receive the other side's petition, re-check the entire contract file for an arbitration clause and assess its validity within the first 15 days — that is the "golden window" for challenging court jurisdiction.

11. Is hiring a lawyer for arbitration more expensive than for court litigation?

Short answer: The law does not fix lawyers' fees for any procedure — they are market prices agreed between client and counsel. In practice, fees for arbitration cases are usually higher than for comparable court cases, given the deeper expertise required, the heavier preparation load, and the single-instance nature that leaves no chance to fix mistakes on appeal.

Explanation: A commercial arbitration case demands counsel fluent in the substantive law, international advocacy skills, and the procedural rules of the chosen centre — a scarcer skill set than ordinary court litigation. The file is typically bulkier too: multiple rounds of written submissions, expert reports, multi-day hearings. And because the award is final, counsel must prepare as if there is no second chance — unlike in court, where first-instance errors can still be corrected on appeal. Take the total view, though: an arbitration case concluded in one proceeding may cost less than counsel fees for two court instances stretching over two years.

Legal basis: No legal instrument sets lawyers' fees — legal service fees are agreed by the parties under the Law on Lawyers 2006 (amended 2012); Ordinance 05/2024/UBTVQH15 regulates litigation costs only and does not cover lawyers' fees.

Next step: When inviting fee quotes, ask for a clear breakdown by phase and scenario (partial win/loss, with or without expert assessment), and ask about the lawyer's actual experience at the very centre that will hear the case.

Your question isn't answered here?

Every dispute has its own shape — value, evidence, counterpart, business goals. If you are weighing court against arbitration for a specific matter, contact FLAT Law Firm for advice on the right option: hotline 0988424851.

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References

Civil Procedure Code (Bộ luật Tố tụng dân sự) No. 92/2015/QH13 (consolidated text 99/VBHN-VPQH), still in force.
Commercial Arbitration Law (Luật Trọng tài thương mại) No. 54/2010/QH12 (consolidated text 60/VBHN-VPQH), still in force.
Resolution No. 326/2016/UBTVQH14 on court fees and charges, still in force.
Ordinance No. 05/2024/UBTVQH15 on Litigation Costs, effective 1 July 2025.
Arbitration Rules of the Vietnam International Arbitration Centre (VIAC).
Fee schedule of the Vietnam Commercial Arbitration Centre No. 1 (Decision 03/QD-VN1AC dated 10 June 2025) — used for illustration.