I always thought other way round: if both vehicles are stopped, vehicle going up needs to backup and give way to the vehicle coming down.
When two vehicles meet on a steep road where neither vehicle can pass, the vehicle facing downhill must yield the right-of-way by backing up until the vehicle going uphill can pass. The vehicle facing downhill has the greater amount of control when backing up the hill. (http://apps.dmv.ca.gov/pubs/hdbk/right_of_way.htm)
So if both vehicles are moving and there's room for one vehicle to pass, then vehicle going down needs to stop and give way to vehicle coming up.
If both vehicles are stopped and neither can pass, then vehicle going down needs to backup and give way.