A LEGAL ANALYSIS OF THE IMPLICATIONS OF INSTALLMENT SALE AND HIRE-PURCHASE CONTRACTS UNDER LAO CIVIL LAW

Abstract

This research aims to analyze the legal differences between installment sale contracts and hire-purchase contracts under the Lao People’s Democratic Republic’s Civil Code. The study examines the legal consequences arising from misunderstandings about contract types, as well as the civil and criminal liabilities associated with ambiguous or unfair contractual terms. The research adopts doctrinal legal methodology, relying on statutory interpretation, case analysis, and comparative legal frameworks within civil law systems.

          This research uses qualitative research methodology by collecting data from legal documents, books, textbooks, academic articles, research reports and related foreign laws (Documentary Research) by using content analysis and comparative analysis

          The findings indicate that Lao civil law lacks specific provisions on hire-purchase contracts, resulting in interpretative gaps that allow contractual imbalances, especially against consumers. For instance, some contracts are labeled as sales but include unilateral repossession clauses without judicial oversight. This study recommends codifying specific rules on hire-purchase contracts, standardizing contract forms, regulating unfair terms, and enacting consumer protection legislation. It also proposes doctrinal developments such as conditional ownership theory and substantive fairness principles to ensure legal interpretations are aligned with equity and the rule of law. The government should have a policy to promote Lao PDR citizens to have knowledge and understanding of both laws.