COTECCONS CONSTRUCTION JOINT STOCK COMPANY (Coteccons) hereby announces the conclusion of the dispute case No. 49/23/HCM regarding the payment obligation to BOHO DECOR COMPANY LIMITED (Boho).
In the time of 2020, Coteccons and Boho had signed and implemented Contracts in which Boho was the subcontractor for Coteccons in designing, supplying, and finishing the interior of the construction investment projects (Phase implemented by the former leadership).
On April 18, 2023, Boho sent a document requesting Coteccons to pay approximately VND 44 billion related to the transactions in the above-mentioned period. When reviewing the records and legal documents, Coteccons found that making the payment as requested by Boho would affect the rights and interests of shareholders. The reasons are: (i) The documents attached to Boho’s payment request lack a legal basis and it is impossible to determine the amount to be paid; (ii) the signed Contracts are transactions with related parties but have not been approved by competent authorities in accordance with the provisions of the Law on Enterprises and the Law on Securities; (iii) The State Securities Commission has issued a decision to impose administrative sanctions on the types of transactions with related parties that occurred during the above-mentioned period.
In the spirit of cooperation, Coteccons has repeatedly proposed to organize a meeting for the two parties to clarify Boho’s payment request and provide documents proving the payment value. However, Boho has decided to file a lawsuit at the Vietnam International Arbitration Center, Ho Chi Minh City Branch (“VIAC“).
Throughout the hearings of the Arbitral Tribunal under VIAC, Coteccons has taken legal actions to object because the procedure for establishing the Arbitral Tribunal did not comply with the provisions of the law, and at the same time requested a review of the transparency and signing authority of the Contracts between Boho and Coteccons; however, these requests were not accepted by the Arbitral Tribunal.
On January 2, 2024, the Arbitral Tribunal issued an Arbitral Award determining that Coteccons must pay Boho the principal debt of VND 21,989,723,400 together with other fees, instead of the approximately VND 44 billion as requested by Boho above.
On February 2, 2024, Coteccons filed a petition with the Ho Chi Minh City Court requesting the annulment of the Arbitral Award for the reasons mentioned above. On July 19, 2024, Coteccons received the Decision of the Ho Chi Minh City Court dismissing Coteccons’s request and requiring the implementation of the Arbitral Award.
In the spirit of the rule of law, Coteccons will comply with the content of the decision of the competent authority arcording to Law.
Once again, we would like to affirm that Coteccons always places the motto “Creating a positive impact on society” with the factor of “Humanity” at the forefront. On the basis of mutual benefit and based on the principle of the rule of law, Coteccons always ensures payment when the related parties have made transactions that give rise to payable debts, but must strictly comply with the conditions of the signed Contracts and the provisions of the Law; if there are any arising transaction amounts with sufficient evidence, we are ready to cooperate to resolve issues related to the economic contract between Coteccons and its partners.
This is the way for Coteccons to demonstrate transparency and commitment to protecting the interests of shareholders, investors, and partners.
Best regards,
