Vinalines must give VND65.2 billion (US$3.1 million) as compensation to South Korea's SK Engineering and Construction Company, Ltd, according to verdict No 28/12 issued by the Vietnam International Arbitration Centre (VIAC). The Hanoi City People's Court has not accepted the state-owned corporation's argument for annulment of the verdict. — Photo chinhphu.vn

HA NOI (Biz Hub) — The Hanoi City People's Court has backed up the decision of the Vietnam International Arbitration Centre (VIAC) regarding the Vietnam National Shipping Lines (Vinalines), the Saigon Times newspaper reported.

In January 2014, VIAC issued verdict No 28/12, requiring Vinalines to give VN47.9 billion (US$2.28 million) as compensation to South Korea's SK Engineering and Construction Company, Ltd. The State-owned corporation was fined for violating its contract on the construction of the Van Phong International Transshipment Port in the central province of Khanh Hoa. A month later, VIAC raised the fine to VND65.2 billion ($3.1 million).

Vinalines then petitioned the Hanoi People's Court. The corporation listed five points regarding alleged violation of litigation procedures, and asked the court to annul VIAC's verdict.

The court announced on March 7 that it will take up the case. In July, the Prime Minister signed a document asking the court to consider the petition of Vinalines as per the law.

After eight months of handling the case, the court issued a decision, signed by Judge Nguyen Thi Dao, which said that the Hanoi City Supreme People's Procuracy does not have any basis for accepting Vinalines's argument for annulment of the verdict. The procuracy also asked the court not to annul the verdict.

The court said that VIAC had followed the litigation procedures as per the law on commercial arbitration and other Vietnamese laws. Referring to the increased fine, the court said that VIAC had amended some mistakes made on advance payment and arbitration fee. The law on commercial arbitration allows it to make amendments to the amount.

The court also said that this was its final decision and it came into effect on October 3. The concerned parties were not allowed to appeal to a higher court. — VNS