Memorandum of understanding Totally Explained

Everything about Memorandum Of Understanding totally explained

A Memorandum of Understanding (MoU) is a document describing a bilateral or multilateral agreement between parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It most often is used in cases where parties don't intend to imply a legal commitment. It is a more formal alternative to a gentlemen's agreement. However, in some cases, depending on the exact wording, MoUs can have the binding power of a contract. It is important to note that, as a matter of well-established law, a contract doesn't have to be labeled "contract," to be legally binding; it could be labeled "Christmas Carol" (pick your whimsy) and still be enforceable in a court of law. Whether or not a document constitutes a binding contract depends only on the presence or absence of well-defined legal elements in the text proper of the document (the so-called "four corners"). For example, a binding contract typically must contain mutual consideration - a legally enforceable obligations of the parties, and its formation must take place free of the so-called real defenses to contract formation (fraud, duress, lack of age or mental capacity, etc.). Be advised, therefore, that a document titled "Memorandum of Understanding" can constitute a legally binding contract, depending on for example the wording and general intent of the parties.

In private law

In private U.S. law, MoU is a common synonym for a letter of intent (LoI). One example is the MoU between Bush and Kerry for the 2004 debates iii.

Inside a company or government agency

Many companies and government agencies use MoUs to define a relationship between departments, agencies or closely held companies. These branches of the organization fall under similar control structures but need to ensure smooth operations where there are shared resources or workflows. These could include areas such as service level agreements (SLAs), intra-organization connectivity, intra-organization communications and intra-organization escalations and response patterns. Like the MoU in law, it creates a platform for a clear understanding of each party's commitments/purpose and sets out expectations for a series of pre-determined responses should certain criteria be met that shows that there's either intentional or unintentional breach of the MoU's original commitments/purpose.

In public international law

In international relations, MoUs do generally not fall under the broad category of treaties. For this reason, MoUs may in theory be kept confidential, although the United Nations Legal Section indicates that MoUs should be registered in the Treaty Database to avoid 'secret diplomacy'. However, as a matter of law, the title of MoU doesn't necessarily mean the document isn't binding under international law. To determine whether or not the MoU in question is meant to be a legally binding document (treaty), one needs to examine the intent of the parties. This can be deduced from the wording used. The International Court of Justice has provided some insight into the determination of the legal status of a document in the landmark case of Qatar v. Bahrain, 1 July 1994

. One advantage of MoUs over more formal instruments is that, because no obligations under international law are created, they can be put into effect in most countries without requiring parliamentary approval. MoUs are often used to modify and adapt existing treaties - in which case the title of MoU obviously distracts from the factual treaty status of the document. The decision concerning ratification, however, is determined by the parties' internal law and depends to a large degree on the subject agreed upon. An obvious disadvantage of MoUs is that they can't be enforced, as no obligations under international law have been created. If the intent of states is to create reciprocal obligations and rights, MoUs are not the most apt instrument; if it does in fact represent an agreement to be bound under international law, it's a treaty rather than an MoU, in spite of its title. As was obvious in the Qatar v. Bahrain case, disputes may arise concerning the status of the document once one of the parties seeks to enforce its provisions.
Although MOUs in the multilateral field are seldomly seen, the transnational aviation agreements are actually MoUs.
Examples include:

The Memorandum of Understanding Relating to the Treaty between the United States of America and the Union of Soviet Socialist Republics on the Limitation of Anti-Ballistic Missile Systems on May 26, 1972 signed by US President Richard Nixon and the USSR Successor States updating the Anti-Ballistic Missile Treaty
The Memorandum of Understanding on Hijacking of Aircraft and Vessels and Other Offenses between the US and Cuba, meant to criminalize hijacking in both countries (February 3, 1973)
The Agreed Framework between the U.S. and North Korea over nuclear weaponry on October 21, 1994
The Oil for Food program, for which Iraq signed an MoU in 1996
The agreement between the government of Indonesia and the GAM in the Aceh peace process, 15 August, 2005.
The agreement between the UK and Jordan, Libya and Lebanon regarding potential extradition of suspects (commonly terrorists suspects) who if they're to be tried, must be tried fairly and in a manner similar to the European Convention on Human Rights, for example withholding from using evidence obtained through the use of torture(Article 3). Such an understanding has been criticised for its inability to be legally enforced. This has been highlighted in the current deportation process of the suspected terrorist Abu Qatada, who is wanted by Jordan in connection with a terrorist attack. However, at present, the Court of Appeal have rejected the UK Government's appeal based on their concern at Jordan obtaining evidence potentially incriminating Qatada through the use of torture.

Further Information

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