Not everyone agrees on the benefits of a letter of intent. During trade talks with a Chinese representative in Washington in April 2019, a reporter asked President Donald Trump how long he expected from the duration of the U.S.-China memoranda of understanding. “I don`t like memoranda of understanding because they mean nothing,” the president replied. After some discussion, it was decided that any document resulting from the talks would be called a trade agreement and never a declaration of intent. A Memorandum of Understanding (MOU or MOU) is an agreement between two or more parties described in an official document. It is not legally binding, but signals the willingness of the parties to move forward with a contract. If you`re working with other groups, hiring consultants, or hiring organizations to provide services to you or your target audience, you`ll often find it helpful to “put it in writing.” This section will help you read, understand and draft contracts and memoranda of understanding, the two types of documents that most organizations need in their relationships with others. Two organizations may sign a Memorandum of Understanding to collaborate on a program. One of them, on the basis of their agreement, issues grants to set up the programme, and then the other – without whose participation the programme cannot be carried out – resigns. The first organization can then be asked to repay the grant money because it was spent on a program that never took place. In this case, although there was no contract or exchange in the original agreement, the second organization could be legally obliged to reimburse the first organization. Or not. It depends on the circumstances and the opinion of the judge – that`s why it`s a grey area.
If you do not agree with any of the terms of the Agreement or if you have any questions or problems with it, ask for them before signing them. A memorandum of understanding, as explained above, is not a legal document and will not stand up in court. You can`t use it â€“ except morally â€“ to keep another organization to what it is promised. But you can use it as a guide, as a reminder, as an incentive to act. Explain the consequences if one of the parties does not deliver what they have agreed. .