Asset Recovery from Corruption through Civil Litigation: Practices in Selected Countries and Recommendations for Vietnam

Abstract: In recent times, the issue of recovering corrupt assets has been continuously on the international agenda. Along with the method of recovering assets through criminal measures, civil lawsuits are considered a reliable and effective tool for countries to recover corrupt assets. This article analyzes the legal provisions on civil lawsuits to recover corrupt assets and examples related to the practice in some countries, thereby providing some recommendations for Vietnam.

Keywords: Civil lawsuits; recovering corrupt assets; UNCAC.

Introduction

Introduction

In the resolution of cases involving corruption and economic crimes, in addition to public concern regarding the penalties imposed on those who engage in corrupt acts, society is particularly attentive to how assets obtained through corruption are recovered and to what extent the consequences can be remedied. If corrupt assets are not recovered, the handling of corruption cases remains limited to imposing appropriate punishment on offenders. In such circumstances, the fight against corruption cannot be considered thorough and fails to remedy the harm caused by corruption. Therefore, the recovery of corrupt assets is identified as an extremely important task and is regarded as the most effective measure of success in combating and preventing corruption and other negative practices.

Alongside asset recovery through criminal prosecution; recovery without a criminal conviction; and recovery through administrative decisions, civil litigation is considered one of the effective methods for recovering corrupt assets. Civil litigation is particularly effective when criminal law avenues are unavailable or have a low likelihood of success

1. Overview of Civil Litigation for the Recovery of Corrupt Assets and International Legal Basis

Civil litigation for the recovery of corrupt assets is a form of civil action between two parties before a court, in which the plaintiff files a claim for damages arising from the defendant’s conduct and seeks appropriate compensation. Courts in certain countries may have jurisdiction in any of the following circumstances: (1) if the defendant is a natural or legal person residing in or having a connection with that country; (2) if the assets are located within or have been transferred to that country; or (3) if an act of corruption or money laundering has been committed within that country.

The United Nations Convention against Corruption (UNCAC) emphasizes the importance of civil proceedings and remedies in the fight against corruption. Article 34 of UNCAC provides that States Parties may consider corruption as a relevant factor in declaring contracts or other transactions arising from corrupt acts void or in ensuring the cancellation of contracts. Article 35 requires States Parties to take necessary measures and establish appropriate mechanisms to ensure that entities or individuals who have suffered damage as a result of corruption have the right to initiate legal proceedings to claim compensation. Furthermore, UNCAC recommends that States consider implementing asset recovery through civil litigation: “Each State Party shall, in accordance with its domestic law, take such measures as may be necessary to permit another State Party to initiate civil action in its courts to establish title to or ownership of property acquired through the commission of an offence established in accordance with this Convention” (Article 53(a)).

Similarly, regional recognition of the importance of civil proceedings in the fight against corruption has been achieved through the Council of Europe Civil Law Convention on Corruption. Article 1 of this Convention requires member States to provide that individuals or legal entities who have suffered damage as a result of corruption have the right to initiate legal action to obtain compensation for the harm suffered. Accordingly, the 35 countries that have ratified this Convention are obligated to incorporate its provisions into their domestic legal systems to allow victims of corruption broader access to civil remedies.

2. Plaintiffs and Defendants in Civil Lawsuits for the Recovery of Corrupt Assets

2.1. Plaintiffs

In theory, any natural or legal person can be a victim of corrupt acts (such as bribery, embezzlement, or misappropriation of corporate assets). In practice, however, the range of potential plaintiffs in civil lawsuits for the recovery of corrupt assets is limited to parties with a specific legal interest in the case. In most jurisdictions, the general rule is that any individual or organization suffering harm as a result of corruption or having entered into a contract affected by corruption may have the right to bring a civil action and claim damages. States and government agencies harmed by acts of corruption are also common plaintiffs in civil lawsuits seeking the recovery of corrupt assets. Local public entities may likewise bring civil actions if they can demonstrate direct damage caused by the misconduct of a former local leader. State-owned enterprises may also have standing to pursue civil litigation.

Many countries have recognized the right of foreign states to bring lawsuits before their civil courts. Provisions allowing claims by parties harmed by corruption may be incorporated in civil codes, criminal codes, or anti-corruption laws. For example, in Kenya, Section 51 of the Anti-Corruption and Economic Crimes Act 2003 provides that “[a] person who engages in any conduct constituting corruption or an economic crime shall be liable to any person who suffers loss as a result of the conduct for full compensation for the loss suffered.” In the United States, under the Racketeer Influenced and Corrupt Organizations Act (RICO), foreign governments or foreign citizens acting as civil plaintiffs may seek compensation for damages caused by unlawful corrupt activities.

A notable example of a successful civil lawsuit brought by a state before a foreign court, resulting in compensation, is the case of Diepreye Alamieyeseigha of Nigeria: Alamieyeseigha served as the Governor of Bayelsa State from May 1999 until his impeachment in September 2005. In November 2005, the Economic and Financial Crimes Commission of Nigeria charged him criminally with 40 counts of money laundering and corruption. He pleaded guilty in Nigeria in 2007. More than USD 17 million in overseas assets were confiscated and repatriated to Nigeria as criminal proceeds through civil lawsuits filed by Nigeria abroad. Recognizing that seeking mutual legal assistance in a criminal case would be time-consuming, Nigeria initiated civil proceedings in the United Kingdom. In rulings issued in 2006 and 2007, based on the UK Proceeds of Crime Act, the High Court of Justice in London declared that Nigeria was the true owner of three residential properties in London and the credit balances of several bank accounts—amounting to approximately USD 2.7 million (held at the Royal Bank of Scotland under the name Santolina Investment Corporation)—as well as USD 1.5 million seized at the time of arres

2.2. Defendants

In civil lawsuits seeking compensation for damage caused by corrupt activities, the defendants will typically be the corrupt public officials or the individuals who paid the bribes. One factor to consider when attempting to recover corrupt proceeds from public officials is the issue of immunity from criminal prosecution or even from civil suits that they may enjoy. However, very few corrupt officials hold assets in their own names. Therefore, relatives, close associates, or companies controlled by corrupt officials may also be named as defendants. The involvement of financial institutions may be particularly significant, for example, in facilitating the theft, concealment, and possible laundering of illicit funds by corrupt officials. Plaintiffs may bring actions against individuals who knowingly assist in concealing assets or those who receive such assets as intermediaries in laundering the proceeds of corruption.

3. Jurisdiction of the Court

Before filing a lawsuit, the injured state or the aggrieved party must determine whether the court where the lawsuit is to be filed has jurisdiction. Jurisdiction is the official authority to consider, conclude, and adjudicate a matter. To exercise jurisdiction and issue binding decisions, the court must have jurisdiction over the subject matter relating to the property and personal jurisdiction, that is, the ability to determine the rights of the persons and property involved.[6] There may be more than one court with jurisdiction. The image below illustrates considerations regarding the possible venues for initiating the lawsuit:

In general, a lawsuit may be brought in places connected to the events, persons, and assets to which the complaint relates. The connections need not be extensive and are sometimes referred to as “minimal contacts.”[7] In addition, the court must find that it is reasonable for the suit to be brought there. The rationale for these limits is fairness, which indicates that a person should not be sued in a place with which they have no connection, as that would impose substantial cost and inconvenience on that person.

Although rules vary across jurisdictions, courts will generally have jurisdiction to hear proceedings related to corruption that causes monetary loss if: (1) the defendant resides or regularly conducts business there; (2) the defendant has voluntarily submitted to the court’s jurisdiction (for example, by contractual agreement); (3) the corrupt act occurred there; (4) the proceeds of the corrupt act in question are located or have been laundered there; or (5) the contract was performed there.[8]

In practice, in most jurisdictions a person can usually be sued where they reside. For example, in the European Union (EU), jurisdiction is determined in the Member State where the defendant is domiciled, regardless of that person’s nationality.[9] In some other jurisdictions, a person may be sued where their assets are located — assets they own or control, particularly where those assets relate to the dispute. The EU provides a typical example of asset-based claims by going further and allowing for exclusive jurisdiction, regardless of the parties’ domiciles, for the courts of the Member State where real property is situated or where a leasehold right over the property exists.[10]

Practice shows that the principal factors to consider when deciding which court should hear a case are often the location of the assets and the defendant’s connections. The choice of forum may depend heavily on where the assets obtained through corruption are located. If there is a judgment in the place where the assets are located, it will be easier to seize those assets or to obtain an equivalent judgment enforceable against other assets of the defendant. Courts often have jurisdiction, sometimes exclusive jurisdiction, where real property is the subject of the dispute. For example, in the civil actions against the former President of Zambia discussed below, the existence of related bank accounts in London was a powerful factor supporting filing the suit in the United Kingdom:

Chiluba left the presidency in 2002. In February 2003, he was criminally charged in Zambia along with his former intelligence director, Xavier Chungu, and several officials with 168 counts of embezzlement and money laundering of more than USD 40 million from state funds. In 2004, in the United Kingdom, the Attorney General of Zambia, on behalf of the Republic of Zambia, filed civil proceedings against Chiluba and 19 of his associates to recover funds transferred by the Ministry of Finance from 1995 to 2001. The funds in question were alleged to have been diverted to pay government debts. The Attorney General of Zambia acknowledged that some funds were indeed used for that purpose but that the majority were not. In 2007, the UK court held Chiluba and his co-defendants liable for embezzlement of USD 46 million. Bringing the suit in London had several advantages because of the close connection between the assets and the defendants to London. Much of the money alleged to have been stolen had passed through or been held in accounts in London. Most of the funds transferred from Zambia passed through law firms and bank accounts in the United Kingdom. Ultimately, the judgments could be executed easily and immediately without further legal action.[11]

The ease of enforcement of a judgment is a factor supporting a court’s willingness to accept the case, as discussed above. Conversely, if the person has no assets in the jurisdiction where the suit is filed, the plaintiff may need to obtain a judgment in one jurisdiction and then seek enforcement in another jurisdiction, which is often more difficult and costly. The choice of forum for civil proceedings may also be influenced by where a related criminal prosecution is pending. If the defendant has been criminally charged, the courts of that country may be an additional option for a civil suit.[12] However, in some jurisdictions a civil action may be stayed pending resolution of the criminal case.[13] Concurrently, in civil-law jurisdictions, if a criminal prosecution is pending, victims may have the right to participate as a civil party in the criminal proceedings and may use that route as a means of claiming compensation.

Where domestic criminal proceedings before national courts are protracted, a civil action in the jurisdiction where the assets are located, or even participation as a civil party in criminal proceedings abroad, may be the only opportunity to recover assets, particularly if mutual legal assistance requests based on the domestic criminal case are unlikely to succeed. Moreover, in some jurisdictions, especially transitional democratic regimes, local authorities may be unable to prepare an adequate mutual legal assistance request to seek asset recovery abroad due to lack of evidence against former senior officials. However, law enforcement agencies in the jurisdiction where the assets are located will often be able to initiate criminal proceedings against those persons based on bank reports and other evidence collected locally. In that situation, appearing as a civil party before a foreign court can help victim states gather the evidence necessary to later prepare an appropriate criminal mutual legal assistance request.[14]

Another important factor for states and government entities to consider when contemplating civil litigation in a foreign jurisdiction is the risk of exposure to potential counterclaims arising from the same legal relationship. The principle that a sovereign state cannot be sued in the courts of another state is a well-established rule of customary international law. States may waive immunity or consent to litigation. They may do so expressly, by statute, or implicitly by initiating litigation themselves. In such circumstances, litigation may abrogate some immunities. The issue of possible counterclaims arises at the domestic level but is even more relevant when choosing a forum that involves foreign jurisdiction. Consequently, the decision to choose a foreign forum and to reduce or waive immunity from foreign jurisdiction must be carefully considered and decided by the competent authorities of the claimant (victim) state.[15]

4. Forms of Civil Actions for the Recovery of Corrupt Assets

4.1. Claims for Ownership of Property (a State Files a Claim to Assert Ownership over a Specific Asset)

An ownership claim is a legal action in which a person who owns something requests the court to return that property or its equivalent value. Under the United Nations Convention against Corruption, a State, as the lawful owner of an asset, may fully exercise its rights over that asset regardless of who possesses it.[16] Courts in many countries around the world may grant a request by another State to return property to that State if there is sufficient evidence to conclude that the funds used to purchase the property belonged to the requesting State. Corrupt actors frequently engage in multiple transactions to conceal corrupt assets. The requesting State may trace the trail of the corrupt assets and assert its claim even if the asset has been involved in a series of subsequent transfers. However, regarding bona fide purchasers, certain differences among legal systems must be emphasized. Civil law countries (for example, Switzerland, Japan, or Germany) may protect bona fide purchasers, and such protection remains effective for a certain period from the date of the corrupt act.[17] By contrast, in common law countries, a subsequent bona fide purchaser cannot acquire ownership of stolen property because stolen property cannot convey legal title.

The following example illustrates how a court may grant a State’s request for the return of property if there is sufficient evidence to conclude that the funds used to purchase the property belonged to that State:

In December 2011, the State of Libya filed a claim with the High Court in London seeking ownership of a £10 million house in London owned by Capitana Seas Limited (Capitana), a British Virgin Islands company controlled by Saadi Qadafi (son of former Libyan leader Muammer Qadafi). Neither Saadi Qadafi nor Capitana appeared in court to defend the claim. Libya’s lawyers then applied for a default judgment. The judge held that the property had been improperly and unlawfully purchased with funds belonging to the claimant. Accordingly, the judge awarded the property to the claimant State of Libya.[18]

4.2. Claims Against Individuals

Claims for ownership of property and related remedies may not be available in all circumstances. For example, such claims may not be feasible if the proceeds cannot be traced because they have been completely laundered, making it impossible to link the original funds to the assets ultimately identified in the defendant’s possession. In such cases, personal claims may be brought against those who hold the assets in question or who participated in the corrupt act or subsequent money laundering. Unlike asserting that the claimant State is the true (or beneficial) owner of an asset, the State may instead allege, for example, that it has suffered economic loss and seek payment or compensation from the person responsible for the harm. These are referred to as personal claims. Personal claims may include: (1) claims based on contract; (2) claims for damages; and (3) claims based on unjust enrichment.

a) Contract-Based Claims

In many corruption cases, a contractual relationship exists between the State and the perpetrator of the corrupt act. In cases of bribery, the most common scenarios include employment contracts between the principal (the State) and its agent (the bribe recipient) or contracts for the performance of work between the State and a private company (the bribe payer).

If the State can prove that a contract is void or that the other party has breached the contract, the State may seek monetary damages or restitution under the contract, or may refuse to perform the contract. The invalidity of the contract is based on the ground that the contract was procured by fraud and that consent was affected by corruption. The following example provides a concrete illustration: In 1989, Kenya initially entered into an agreement with World Duty Free Company (WDF) for the construction, maintenance, and operation of duty-free complexes at Nairobi and Mombasa international airports. It was later discovered that, in order to obtain the contract with the Government of Kenya, WDF had bribed former Kenyan President Daniel Arap Moi with the equivalent of USD 2 million. WDF brought a claim before the arbitral tribunal of the International Centre for Settlement of Investment Disputes (ICSID), alleging that Kenya had breached the contract. The Government of Kenya argued that WDF’s procurement of the agreement through bribery violated international public policy. The arbitral tribunal held that bribery is contrary to the international public policy of most, if not all, States. Therefore, the tribunal could not uphold claims based on a contract obtained through corruption, and the government was legally entitled to avoid contractual obligations under the laws of England and Kenya applicable to the contract.[19]

b) Claims for Damages

When corruption occurs, the plaintiff typically must prove that it suffered compensable harm, that the defendant breached a duty, and that there is a causal link between the corruption and the damage. Some jurisdictions require only that the plaintiff show that the defendant’s act or omission caused harm to the plaintiff.

Legal entities and individuals who directly and intentionally participate in corrupt acts bear primary responsibility for damages. Beyond those who directly initiate or commit the act in question, courts may hold liable those who facilitate corruption or who fail to take appropriate steps to prevent it. This may include lawyers or intermediaries who assisted the corrupt acts, or parent companies and employers who failed to exercise proper control over their subsidiaries or employees.[20] It may also include banks through which the funds passed, lawyers whose client accounts were used to transfer stolen assets, or trust service providers and companies involved in establishing and managing shell companies. Such liability may be based on their active participation in the unlawful conduct. Although more difficult to prove, it may also be based on their negligence in verifying the source of funds or the purpose of the transaction, that is, a failure to exercise the required due diligence.

Civil wrongs may be committed directly by bribe givers, bribe recipients, or government officials who embezzle funds. In bribery cases, courts in some jurisdictions may consider that the bribe payer and bribe recipient have committed a joint tort, under which the victim is entitled to recover the entire loss from either party. The basic rule for determining damages in corruption cases requires that the victim be placed as nearly as possible in the position it would have been in had the corruption not occurred. Therefore, all costs or lost profits caused by corruption must be compensated. The following case is a notable example of a civil action for damages:

South Korea sought to purchase military equipment and invited competitive bids from manufacturers. Plaintiff Korea Supply Company (KSC) was a corporation engaged in representing military equipment manufacturers in transactions with South Korea. In the mid-1990s, South Korea invited bids for military equipment. KSC represented MacDonald Dettwiler, a Canadian company, in an effort to win the contract and was to receive a commission of more than USD 30 million. Ultimately, the contract was awarded to a competitor, Loral (later known as Lockheed Martin). In U.S. court, KSC alleged that although MacDonald Dettwiler’s bid was lower and its equipment superior, it was not awarded the contract because Loral Corporation and its agent had bribed and engaged in sexual relations with key South Korean officials. KSC sued for economic damages caused by the defendants’ conduct. In this case, the California Supreme Court accepted KSC’s claims for damages.[21]

c) Claims Based on Unjust or Unlawful Enrichment

A claim based on unjust or unlawful enrichment is an action requiring the defendant to surrender improperly obtained benefits to compensate the plaintiff.[22] Liability for restitution is primarily governed by the principle of unjust enrichment: a person who has been unjustly enriched at the expense of another must make restitution. This principle originates from Roman law: “By natural law, no one should be enriched by the loss or injury of another.”[23]

Accordingly, a State may seek restitution from corrupt officials who have enriched themselves through abuse of power. The plaintiff will succeed in an unjust enrichment claim if it can prove that: (1) the defendant has been enriched; (2) the plaintiff has suffered a corresponding deprivation; and (3) the defendant’s enrichment and the plaintiff’s corresponding deprivation occurred without legal justification.[24]

5. Assessment of the Advantages and Limitations of Asset Recovery through Civil Litigation

The fundamental limitation of this measure is that when filing a lawsuit abroad, the plaintiff in the case will face challenges and costs in tracing assets without the tools of criminal investigation and with the high expenses of civil litigation in a foreign jurisdiction. In some cases where the state has a well-founded claim, the private litigation costs (including lawyers, investigators, experts, accountants, and others) pose a serious obstacle to pursuing civil proceedings. Furthermore, individuals or organizations authorized to represent the state in bringing the lawsuit must assume responsibility and justify the use of public funds to finance civil proceedings aimed at recovering stolen assets. This can be challenging for states even in situations where the estimated litigation costs represent only a small proportion of the assets sought. In addition, selecting appropriate counsel or a suitable law firm is no small challenge. Asset recovery cases are often politically sensitive, both in the country where the money was stolen and in the country where it is hidden. Lawyers must be politically astute and able to navigate multiple political systems in a diplomatic yet effective manner. They must be capable of communicating—and at times coordinating communication—among government stakeholders in each country as well as other domestic stakeholders. Generally, lawyers must be familiar with the legal systems of the relevant countries and be willing and able to work with counsel in other jurisdictions. Some jurisdictions have very strict disclosure rules, and lawyers must be careful not to compromise potential criminal liability while pursuing civil remedies. The plaintiff must keep in mind that the multi-jurisdictional nature of asset recovery lawsuits often requires hiring lawyers in multiple jurisdictions and ensuring that they can work as a coordinated team. Typically, a single lawyer (or even a single law firm) will not be sufficient to pursue a complex, multi-jurisdictional asset recovery matter. Moreover, lawyers may need to identify and retain additional specialists, including experts such as forensic accountants, investigators, and other attorneys. Identifying suitable counsel also involves some preliminary consideration of the jurisdiction in which to bring the lawsuit, because a lawyer licensed and practicing in the jurisdiction where the case is filed will usually be required.

However, civil litigation and civil compensation offer many advantages that are not present in other forms of recovery. Some fundamental advantages of civil actions include lower requirements to prove the link between the asset and the violator, a focus on claims for damages in general rather than a specific asset, and a broader range of potential defendants (including third parties).[25]

Despite the advantages and limitations of civil litigation, this avenue is clearly valuable to consider.

First, in civil trials, the evidentiary standards are generally lower than in criminal proceedings. For example, common law countries often allow the plaintiff to prove a civil case using the “balance of probabilities,” meaning that the plaintiff need only show that a fact is more likely than not to be true.[26]

Second, claims for general damages in a civil lawsuit can address certain evidentiary difficulties when the link between the asset and the violation is weak under criminal evidentiary standards. Where it is impossible to establish the connection between the corrupt act and the stolen asset according to criminal requirements, civil litigation may still offer opportunities for success. Large amounts of stolen assets are spent far from the country from which they were taken. Corrupt assets are laundered through multiple transactions, ultimately to purchase real estate, business investments, or valuable goods. In many legal systems, only assets directly connected to the crime can be recovered; assets purchased with laundered money cannot be criminally confiscated. This issue is more pronounced in jurisdictions that recognize only asset-based recovery (legal action to recover a specific asset) and rarely permit value-based recovery (legal action to recover benefits obtained from the proceeds of crime or to impose monetary penalties corresponding to the value obtained through corruption). In any case, civil proceedings may provide for compensation for the matter at hand by allowing claims for general damages.

Third, in some legal systems, criminal liability does not extend to corporations and other legal entities (no corporate criminal liability), and only individuals can be held criminally liable. In such situations, civil compensation and civil actions are seen as powerful tools for states in their efforts to recover corrupt funds.

Finally, civil litigation and civil compensation can broaden the range of defendants and liabilities, effectively “expanding the pool of money” subject to recovery. The injured party can bring a civil lawsuit and seek damages from third parties. Third parties may include anyone who assisted the primary defendant, such as family members, associates, lawyers, banks, or bank managers. A third party may not be criminally liable due to insufficient evidence to meet the standard of “beyond a reasonable doubt,” but may still be proven liable if a lower civil evidentiary standard is applied. Importantly, in civil litigation, officials or former officials and their assets cannot enjoy the same immunity as in criminal proceedings.[27]

6. Practical Application in Vietnam

The 2015 Civil Code does not contain any explicit provisions on the recovery of corrupt assets. It only provides for the rights of owners over property (Articles 158, 186, 190, 194). Property owners or lawful possessors have the right to request the competent authorities to compel any person infringing their rights of ownership or possession to return the property (Articles 163, 164); to request any possessor, user, or beneficiary of property without legal grounds to return such property to its lawful owner (Article 166); and to demand compensation for damage caused by infringement of ownership rights under Article 170.

Where property is unlawfully appropriated or damaged due to illegal acts, including acts of corruption, and such property is possessed, used, or enjoyed without legal grounds (including property originating from corruption), the owner has the right to petition the competent authorities to reclaim the unlawfully appropriated assets, demand compensation for damage caused by corruption, and request the return of property possessed, used, or benefited from without legal grounds. Thus, although the 2015 Civil Code contains no direct provision on the recovery of corrupt assets through civil litigation, it is entirely possible to rely on the general provisions of the Civil Code and the Civil Procedure Code as the legal basis for initiating a civil lawsuit.

Regarding standing to sue, Vietnamese law does not limit the range of entities entitled to initiate a lawsuit to recover assets. Clause 4, Article 187 of the Civil Code provides: “Agencies and organizations, within the scope of their duties and powers, have the right to initiate civil lawsuits to request the Court to protect public interests or the interests of the State within their areas of responsibility or as provided by law.” This provision does not specifically restrict the types of cases in which agencies or organizations, acting within their duties and powers, may bring suit.

With respect to the procedural status of an agency or organization initiating a lawsuit to protect public interests or State interests: under Clause 2, Article 68 of the Civil Procedure Code on parties to civil proceedings, an agency or organization that brings a civil action to request the Court to protect public interests or State interests within its area of responsibility is also deemed a plaintiff. As plaintiffs, such agencies or organizations must collect, provide, and submit to the Court documents and evidence to prove that their claims are well-founded and lawful.[28]

Regarding the rights of agencies or organizations bringing such actions: in addition to the normal rights of parties/plaintiffs, they may also petition the Court to apply provisional urgent measures to protect public interests or State interests.[29] However, the concept of “agencies and organizations within the scope of their duties and powers” remains unclear, and the right to sue under Clause 4, Article 187 is generally interpreted as applying to agencies performing administrative management functions rather than investigative or prosecutorial bodies.

It can be seen that, although Vietnamese law has initially provided conditions for bringing civil lawsuits to recover corrupt assets, these provisions remain insufficiently detailed, clear, and consistent.[30] In practice, where criminal liability cannot be pursued because the offender is missing, deceased, or has fled, investigative measures such as suspension of investigation or wanted notices must be applied under the current Criminal Procedure Code. Asset recovery in such cases often reaches an impasse, making immediate recovery impossible and creating a high risk that the assets will be laundered or dissipated, further complicating future recovery efforts.[31] In such circumstances, if the law contained specific and detailed provisions on civil actions for asset recovery, recovery efficiency would increase significantly and help prevent laundering or dissipation of assets during suspension of criminal proceedings.

To facilitate the recovery of corrupt assets—especially those with a foreign element—at the highest level of effectiveness, it is necessary to study amendments to the Civil Code and the Civil Procedure Code to provide detailed rules on the responsibility to initiate civil lawsuits to confirm ownership of assets, demand compensation for damages, or claim breach of contract by state agencies, state-owned enterprises, or organizations managing and owning state property.[32] Legal provisions should also be drafted in an open manner to allow third parties to initiate lawsuits in cases where these state entities cannot bring civil actions. In several high-profile corruption cases in China, when assets were transferred abroad, numerous state agencies (including local governments and prosecutors’ offices) and state-owned enterprises were permitted by law to represent the State’s interests as plaintiffs in civil lawsuits to recover corrupt assets.[33]

In cases where the offender is missing, deceased, or has fled and the criminal case cannot proceed—especially where there is evidence that money or assets linked to corruption have been transferred abroad—there should be a provision designating a central agency in Vietnam as the plaintiff to initiate civil proceedings abroad. For Vietnam, the Supreme People’s Procuracy could be proposed as an appropriate body.

The provisions of various laws such as the Civil Code, Land Law, Housing Law, Anti-Corruption Law, and the Law on Electronic Transactions should be reviewed comprehensively to harmonize issues related to the determination of limitation periods, grounds for filing suits, and types of assets—particularly in the digital age where assets exist in diverse forms.[34]

The burden of proof, evidentiary standards, and appropriate provisional measures in civil lawsuits for recovery of corrupt assets also require further study to develop specific provisions that will facilitate effective asset recovery. Some suggested measures include:(1)Applying suitable provisional urgent measures prior to initiating a civil lawsuit to freeze assets suspected of illicit origin, (2)Exempting plaintiffs from court fees and charges, (3)Burden of proof: both plaintiffs and defendants have the right and obligation to prove the lawful origin of assets, but the court should apply a principle whereby, if the defendant cannot prove lawful origin, the assets will be subject to recovery, even if the State cannot demonstrate precisely how the assets are linked to the crime but can show a relationship between the possessor of the assets and the offender (even if the offender has not been convicted), (4)Procedures for applying a court-issued asset recovery order, along with the right to appeal or challenge such an order.

Conclusion

In practice, all avenues for asset recovery—whether criminal or civil—should be pursued simultaneously in order to address corruption from every angle and achieve the objectives of deterrence and enforcement. While criminal measures reflect society’s condemnation of corrupt acts and aim to prevent, punish, and confiscate illegally obtained proceeds, civil measures focus on the interests of victims and aim at compensation and restitution. These proceedings may at times run in parallel and at other times sequentially. Therefore, to achieve the highest effectiveness in asset recovery, it is necessary to employ both criminal and civil remedies concurrently to attain the desired outcome.

1. Civil Law Convention on Corruption, Nov. 4, 1999, Europ. T.S. No.174, Article 1

2. Regulation of the European Parliament and of the Council amending Regulation (EU) No. 1215/2012,of December 12, 2012, which will enter into force on January 10, 2015, Article 4.

3. Regulation (EC) No. 44/2001 or Brussels I Regulation, to be modified by the new Article 24 of the Regulation of the European Parliament and of the Council amending Regulation (EU) No. 1215/2012, of December 12, 2012, that will enter into force on January 10, 2015, Article 22, 24.

4. Brussels I Regulation, Article 5 paragraph 4

5. United Nations Convention against Corruption, Articles 53 to 55.

6. Nigeria v. Santolina Investment Corp. and Ors. EWHC 3053 (Q.B.) (UK High Court decision in Nigeria v. Santolina Investment Corp. and Ors. December 3, 2007 Case No: HC05 CO3602) (2007).

7. Attorney General of Zambia v. Meer Care & Desai (a firm) & Ors., EWHC 952, at § 1 (2007).

8. World Duty Free Company Limited v. The Republic of Kenya, ICSID Case No. ARB/00/7, ITA LAW, (September 25, 2006), http://ita.law.uvic.ca/documents/WDFv.KenyaAward.pdf

9. JEAN-PIERRE BRUN; LARISSA GRAY; CLIVE SCOTT; KEVIN M. STEPHENSON, ASSETRECOVERY HANDBOOK, WORLD BANK PUBLISHER, WASHINGTON, D.C, (2011)

10. JEAN-PIERRE BRUN; DUBOIS, PASCALE HELENE; VAN DER DOES DE WILLEBOIS, EMILE; HAUCH, JEANNE; JAÏS, SARAH; MEKKI, YANNIS; SOTIROPOULOU, ANASTASIA; SYLVESTER, KATHERINE ROSE; AND UTTAMCHANDANI, MAHESH, PUBLIC WRONGS, PRIVATE ACTIONS: CIVIL LAWSUITS TO RECOVER STOLEN ASSETS, WORLD BANK PUBLISHER, WASHINGTON, D.C, (2015)

11. GARY BORN, INTERNATIONAL CIVIL LITIGATION IN UNITED STATES COURTS:COMMENTARY AND MATERIALS, KLUWER LAW INTERNATIONAL PUBLISHER, U.S,(1997)

12. THEODORE S. GREENBERG, LINDA M. SAMUEL, WINGATE GRANT, AND LARISSA GRAY,STOLEN ASSET RECOVERY-A GOOD PRACTICES GUIDE FOR NON-CONVICTION BASEDASSET FORFEITURE, WORLD BANK PUBLISHER WASHINGTON, D.C (2009)

13. BERND H. KLOSE, ASSET TRACING AND RECOVERY, THE FRAUDNET WORLDCOMPENDIUM, ERICH SCHMIDT VERLAG PUBLISHER, BERLIN (2009)

14.Ha Le, Thuy, Tran Thi Len, “Recovery of Assets from Corruption from the Legislative Experience of the European Union and Recommendations for Improving Vietnamese Law,” People’s Court Online Journal, (February 02, 2024), https://tapchitoaan.vn/thu-hoi-tai-san-tham-nhung-tu-kinh-nghiem-lap-phap-cua-lien-minh-chau-au-va-khuyen-nghi-hoan-thien-phap-luat-viet-nam10270.html.

15.OLAF MEYER, THE CIVIL LAW CONSEQUENCES OF CORRUPTION, NOMOS PUBLISHER, BADEN-BADEN (2009)

16.CHARLES MITCHELL; PAUL MITCHELL; STEPHEN WATTERSON, GOFF & JONES LAW OF UNJUST ENRICHMENT, SWEET & MAXWELL PUBLISHER, ENGLAND (2011)

17. MARK PIETH, RECOVERING STOLEN ASSETS WITH A PREFACE BY EVA JOLY, PETER LANG VERLAG PUBLISHER, SWITZERLAND (2008)

18. Le Tien Sinh; Le Tien Vien, “Experiences of Several Countries on Recovery of Assets from Corruption,” Kiem Sat Online Journal, (November 25, 2021), https://kiemsat.vn/kinh-nghiem-mot-so-nuoc-ve-thu-hoi-tai-san-tham-nhung-62706.html.

19. Le Son, “Solutions for Recovering Assets Misappropriated in Corruption and Economic Cases,” Government Electronic Newspaper, (July 31, 2022), https://baochinhphu.vn/giai-phap-trong-viec-thu-hoi-tai-san-bi-chiem-doat-trong-cac-vu-an-tham-nhung-kinh-te-102220731173331118.htm.

20. Nguyen Ha Thanh, “Civil Lawsuits to Recover Assets from Corruption – International Experience and Recommendations for Vietnam,” Legislative Research No.11 – June (2020).

21. Le Minh Trung, “Mechanism for Recovering Illegal Assets without Conviction Procedures in Some Countries and Reference for Vietnam,” Legal Online Journal, (July 28, 2023), https://phaply.net.vn/co-che-thu-hoi-tai-san-bat-hop-phap-khong-qua-thu-tuc-ket-toi-o-mot-so-nuoc-tren-the-gioi-va-tham-khao-cho-viet-nam-ky-1-a256519.html.

22. Emile van der Does de Willebois, Using Civil Remedies in Corruption and Asset Recovery Cases, CASE WESTERN RESERVE JOURNAL OF INTERNATIONAL LAW (2013), https://scholarlycommons.law.case.edu/jil/vol45/iss3/6

* Nguyen Thi Cham – Department of International Cooperation – Supreme People’s Court of Vietnam.

Email: chamnguyensuprcourt@gmail.com. Approved for publication: May 21, 2025.

[1] Civil Law Convention on Corruption, Nov. 4, 1999, Europ. T.S. No.174, Article 1, “Each Party shall provide in its internal law for effective remedies for persons who have suffered damage as a result of acts of corruption, to enable them to defend their rights and interests, including the possibility of obtaining compensation for damage.”

[2] JEAN-PIERRE BRUN; DUBOIS, PASCALE HELENE; VAN DER DOES DE WILLEBOIS, EMILE; HAUCH, JEANNE; JAÏS, SARAH; MEKKI, YANNIS; SOTIROPOULOU, ANASTASIA; SYLVESTER, KATHERINE ROSE; AND UTTAMCHANDANI, MAHESH, PUBLIC WRONGS, PRIVATE ACTIONS: CIVIL LAWSUITS TO RECOVER STOLEN ASSETS, WORLD BANK PUBLISHER, WASHINGTON, D.C,6 (2015)

[3] RICO is a United States federal law enacted as section 901(a) of the Organized Crime Control Act of 1970 and can be found at Title 18 United States Code (U.S.C.) Section 1964.

[4] Nigeria v. Santolina Investment Corp. and Ors. EWHC 3053 (Q.B.) (UK High Court decision in Nigeria v. Santolina Investment Corp. and Ors. December 3, 2007 Case No: HC05 CO3602) (2007).

[5] GARY BORN, INTERNATIONAL CIVIL LITIGATION IN UNITED STATES COURTS: COMMENTARY AND MATERIALS, KLUWER LAW INTERNATIONAL PUBLISHER, U.S, 3 (1997)

[6] Emile van der Does de Willebois, Using Civil Remedies in Corruption and Asset Recovery Cases, CASE WESTERN RESERVE JOURNAL OF INTERNATIONAL LAW (2013), https://scholarlycommons.law.case.edu/jil/vol45/iss3/6

[7] MARK PIETH, RECOVERING STOLEN ASSETS WITH A PREFACE BY EVA JOLY, PETER LANG VERLAG PUBLISHER, SWITZERLAND, 249 (2008)

[8] THEODORE S. GREENBERG, LINDA M. SAMUEL, WINGATE GRANT, AND LARISSA GRAY, STOLEN ASSET RECOVERY-A GOODPRACTICES GUIDE FOR NON-CONVICTION BASED ASSET FORFEITURE, WORLD BANK PUBLISHER WASHINGTON, D.C, 122 (2009)

[9] Regulation of the European Parliament and of the Council amending Regulation (EU) No. 1215/2012, of December 12, 2012, which will enter intoforce on January 10, 2015, Article 4.

[10] Regulation (EC) No. 44/2001 or Brussels I Regulation, to be modified by the new Article 24 of the Regulation of the European Parliament and of the Council amending Regulation (EU) No. 1215/2012, of December 12, 2012, that will enter into force on January 10, 2015, Article 22. There is no substantive change on that provision. Article 24 just provides more explicitly that the existing exclusive jurisdiction rule includes claims regardless of the domicile of the parties, whereas it previously mentioned only “regard- less of domicile.”

[11] Attorney General of Zambia v. Meer Care & Desai (a firm) & Ors., EWHC 952, at § 1. For more information on the legal theories of the case, see box 1.9 in chapter 1 (Zamtrop conspiracy case) (2007).

[12] Brussels I Regulation, Article 5 paragraph 4, one can bring a civil claim for damages or restitution which is based on an act giving rise to criminal proceedings, in the court hearing the criminal case, to the extent that that court has jurisdiction under its own law to entertain civil proceedings, as long as the defendant has a domicile in any of the states party to the convention.

[13] JEAN-PIERRE BRUN ET AL, PRIVATE ACTIONS: CIVIL LAWSUITS TO RECOVER STOLEN ASSETS, WORLD BANK PUBLISHER, WASHINGTON, D.C, 6 (2015).

[14] Emile van der Does de Willebois, Using Civil Remedies in Corruption and Asset Recovery Cases, CASE WESTERN RESERVE JOURNAL OF INTERNATIONAL LAW (2013), https://scholarlycommons.law.case.edu/jil/vol45/iss3/6

[15] OLAF MEYER, THE CIVIL LAW CONSEQUENCES OF CORRUPTION, NOMOS PUBLISHER, BADEN-BADEN, 15 (2009)

[16] United Nations Convention against Corruption, Articles 53 to 55.

[17] OLAF MEYER, THE CIVIL LAW CONSEQUENCES OF CORRUPTION, NOMOS PUBLISHER, BADEN-BADEN, 15 (2009)

[18] Xem mô tả vụ án tại http://star.worldbank.org/corruption-cases/node/19587; http://www.thebureauinvestigates. com/2012/03/09/saadi-gaddafi-ordered-by-high-court-to-hand-over-10m-london-house-to-people-of-libya/; and http://www.anticorruptionlaw.com/blog.aspx?entry=5238.

[19] World Duty Free Company Limited v. The Republic of Kenya, ICSID Case No. ARB/00/7, ITA LAW, (September 25, 2006), http://ita.law.uvic.ca/documents/WDFv.KenyaAward.pdf

[20] JEAN-PIERRE BRUN; LARISSA GRAY; CLIVE SCOTT; KEVIN M. STEPHENSON, ASSET RECOVERY HANDBOOK, WORLD BANK PUBLISHER, WASHINGTON, D.C, 3 (2011)

[21] Korea Supply Co. v. Lockheed Martin Corp. 29 Cal.4th 1134, 63 P.3d 937 (Cal., 2003).

[22] BERND H. KLOSE, ASSET TRACING AND RECOVERY, THE FRAUDNET WORLD COMPENDIUM, ERICH SCHMIDT VERLAG PUBLISHER, BERLIN (2009)

[23] CHARLES MITCHELL; PAUL MITCHELL; STEPHEN WATTERSON, GOFF & JONES LAW OF UNJUST ENRICHMENT, SWEET & MAXWELL PUBLISHER, ENGLAND (2011)

[24] Emile van der Does de Willebois, Using Civil Remedies in Corruption and Asset Recovery Cases, CASE WESTERN RESERVE JOURNAL OF INTERNATIONAL LAW (2013), https://scholarlycommons.law.case.edu/jil/vol45/iss3/6

[25] BERND H. KLOSE, ASSET TRACING AND RECOVERY, THE FRAUDNET WORLD COMPENDIUM, ERICH SCHMIDT VERLAG PUBLISHER, BERLIN, 116 (2009)

[26] Emile van der Does de Willebois, Using Civil Remedies in Corruption and Asset Recovery Cases, CASE WESTERN RESERVE JOURNAL OF INTERNATIONAL LAW (2013), https://scholarlycommons.law.case.edu/jil/vol45/iss3/6

[27] JEAN-PIERRE BRUN ET AL, PRIVATE ACTIONS: CIVIL LAWSUITS TO RECOVER STOLEN ASSETS, WORLD BANK PUBLICATIONS, WASHINGTON, D.C, 6 (2015).

[28] Article 91 of the Civil Procedure Code of 2015 of Vietnam on the burden of proof.

[29] Article 134 of the Civil Procedure Code of 2015 of Vietnam.

[30] Ha Le, Thuy, Tran Thi Len, “Recovery of Assets from Corruption from the Legislative Experience of the European Union and Recommendations for Improving Vietnamese Law,” People’s Court Online Journal, (February 02, 2024), https://tapchitoaan.vn/thu-hoi-tai-san-tham-nhung-tu-kinh-nghiem-lap-phap-cua-lien-minh-chau-au-va-khuyen-nghi-hoan-thien-phap-luat-viet-nam10270.html.

[31] Le Son, “Solutions for Recovering Assets Misappropriated in Corruption and Economic Cases,” Government Electronic Newspaper, (July 31, 2022), https://baochinhphu.vn/giai-phap-trong-viec-thu-hoi-tai-san-bi-chiem-doat-trong-cac-vu-an-tham-nhung-kinh-te-102220731173331118.htm.

[32] Nguyen Ha Thanh, “Civil Lawsuits to Recover Assets from Corruption – International Experience and Recommendations for Vietnam,” Legislative Research No.11 – June (2020).

[33] Le Minh Trung, “Mechanism for Recovering Illegal Assets without Conviction Procedures in Some Countries and Reference for Vietnam,” Legal Online Journal, (July 28, 2023), https://phaply.net.vn/co-che-thu-hoi-tai-san-bat-hop-phap-khong-qua-thu-tuc-ket-toi-o-mot-so-nuoc-tren-the-gioi-va-tham-khao-cho-viet-nam-ky-1-a256519.html.

[34] Le Tien Sinh; Le Tien Vien, “Experiences of Several Countries on Recovery of Assets from Corruption,” Kiem Sat Online Journal, (November 25, 2021), https://kiemsat.vn/kinh-nghiem-mot-so-nuoc-ve-thu-hoi-tai-san-tham-nhung-62706.html.