The conclusion of a "Memorandum of Understanding" and a "formal contract" both indicate that the signatories have become some kind of agreement or agreement. The following will explain the difference between the two from the aspects of legal effect, content and application field.
The memorandum of understanding was formed during the contract negotiation between the two parties, aiming to show that both parties should understand each other and properly handle differences and disputes. Generally speaking, a Memorandum of Understanding is not as formal as a formal contract.
I. Legal effect
Memorandum of Understanding (MOU) is equivalent to a written record of oral commitment, which is different from written commitment (formal contract, agreement, contract). Usually, MOU has no legal effect, which is basically the affirmation of the negotiation results at this stage by both parties, but when there is a problem in the formal contract, MOU can explain the disputed terms.
Once a contract comes into effect, it is legally binding, which is mainly manifested as follows: the parties shall not change or terminate the contract without authorization, and the parties shall perform their contractual obligations in accordance with the contract, and the parties shall perform certain contractual obligations in accordance with the principle of good faith.
Second, the content
The contents of the memorandum of understanding usually include: cooperation opportunities, confidentiality rules, authentic language of the agreement, term of the agreement, irrevocable clauses, termination of the agreement, application of law, etc. Among them, the confidentiality rules, the term of the agreement, the irrevocable clause, the termination of the agreement and the application of law also have legal effect after the contract takes effect.
The contents of a contract are agreed upon by the parties, and generally include the following terms: the name and domicile of the parties, the subject matter, quantity, quality, price or remuneration, time limit, place and method of performance, liability for breach of contract, way of dispute settlement, etc. The parties shall fully perform their obligations in accordance with the agreement.
Third, the application field
From the commercial and civil point of view, the "Memorandum of Understanding" is usually applicable to the case that the signatory fails to make a legal commitment or form a legally binding understanding, which can be understood as a variant of the "gentleman's agreement" to some extent; An "agreement" is usually legally binding and stipulates the legal rights and obligations of the signatories.
In the field of public international law, the "memorandum of understanding" reached between governments is also regarded as an "agreement" with legal effect. Generally speaking, after the government signs the "treaty", it still needs the approval of its own legislature to take effect; The "Memorandum of Understanding" is flexible, and can be implemented as long as the government signs it, without the approval of the domestic legislature.
Extended material
Case:
1.20 18 During the Beijing Summit of the Forum on China-Africa Cooperation, China signed memorandums of understanding with 28 countries and the African Union, and the memorandums of understanding of the remaining nine countries were signed on other occasions before the Forum.
2.2065438+On March 24th, 2009, Siemens AG signed a memorandum of understanding with the Belt and Road Construction Promotion Center of the National Development and Reform Commission (NDRC) of China in Beijing.
3. 2065438+September 20th, 2008? This morning, at the 17th China Western International Expo held in Chengdu, People's Network Co., Ltd. and Ya 'an Municipal People's Government held a signing ceremony for strategic cooperation. The two sides will carry out in-depth cooperation in five major areas, namely, the construction of Ya 'an Chinese herbal medicine science and technology development industrial cooperation project, the promotion of "medical+health" brand construction, tourism and tea industry, the construction of Southwest (Ya 'an) big data center, and the promotion of Ya 'an brand.
Baidu Encyclopedia-Memorandum of Understanding
Baidu Encyclopedia-Contract
People.com-People.com and Ya 'an Municipal People's Government formally signed a strategic cooperation agreement.