Memorandum of Understanding – What Is It Actually?
Memorandum of understanding is actually a letter of intent. MOU is not legally binding though people often consider the document official. The document is used to be created precede the formal contract that is legal, and of course a binding one. However, the MOU often used both in international and multinational agreements. The reason is that the memorandum is easy to create. In addition, unlike the treaties, it is also easier the keep the documents in secret. You can also use the memorandum as a tool to help you modify the formal contract in case any changes needed.
Though the documents often come in different complexions and lengths, they have common functions. They are the representations of the expectations made by both parties that make the agreement. Unlike treaties, the memorandum of understanding doesn’t require any funding exchange.
Memorandum of Understanding – Why Is It Important?
When it comes to the discussion of the two parties that want to make an agreement, the memorandum of understanding or MOU always comes first. Though the MoU is typically a nonbinding agreement, it should be set before a formal contract made.
What Should be There in MOU Template?
When creating a memorandum of understanding agreement templates, there are some key factors that you have to consider carefully.
1. Overall Intent
Every template used for MOU should be started with the overall intent’s outline. It should be the one that shows a clear reflection of purpose from those who get involved in the agreement. You need to make sure that there is no grey area when creating the overall intent.
2. Parties Involved
Since the memorandum involves two parties or more, it will be very important to make sure that the template includes the names of all the parties. It can be in the form of individual names, organizations, companies, groups, or others.
3. Time Period
Another thing to consider a template for MOU is the time period. Make sure that you specifically mention the exact time period to show when the agreement made. Keep in mind that the template should contain both the start date and end date of the agreement.
The responsibilities and duties of the participants should be clearly stated. The information should also be very detail to prevent any confusion in the future.