Draft Guidelines on Out-of-Court Workouts (OCW)
On October 22, 2024, the Vietnam Banks Association (VNBA), in collaboration with the International Finance Corporation (IFC) under the World Bank Group (WBG), held a meeting to discuss the Draft Guidelines on Out-of-Court Workouts (OCW). The documents are developed to support credit institutions in resolving non-performing debts more effectively, reducing the non-performing debt ratio, and protecting the interests of related parties.
According to international practice, OCW is a negotiation/mediation method (with the participation of a third party) to restructure debts with the participation of multiple creditors and a debtor facing financial distress. The mechanism helps indebted enterprises overcome financial distress, restore business operations, and avoid insolvency, benefit other stakeholders (employees, customers, suppliers, investors, etc.). This mechanism helps to relieve pressure on the Courts in resolving disputes, and bankruptcy cases, contributing to the sustainability of the financial system, promoting economic growth, and reducing the unemployment rate, etc.
Based on international good practices and World Bank guidance, the WBG’s expert team proposes an OCW framework for Vietnamese banks, in accordance with international standards and Vietnamese applicable laws.
On behalf of the expert team, Mr. Nguyen Hung Quang (Managing Partner of NHQuang&Associates, President of Vietnam International Commercial Mediation Center (VICMC)), presented the main contents of the Draft Model OCW principles.
Mr. Nguyen Quoc Hung – Vice President and General Secretary of VNBA, chaired the meeting, Ms. Nina Pavlova Mocheva, Senior Financial Expert of the WBG and representatives of member organizations of the Vietnam Banks Association attended the meeting.
Dispute resolution in court, arbitration and especially negotiation and mediation have been one of the strengths of NHQuang&Associates for many years. In addition to experiences in practical dispute resolution, Mr. Nguyen Hung Quang and the associates have also conducted many studies on the Court system, litigation procedures for commercial dispute resolution in court, systematic investor response mechanism, commercial mediation, commercial arbitration and supported for national student competitions on commercial mediation and arbitration.