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Memorandum Of Understanding Between Supplier And Buyer Template for Germany

A Memorandum of Understanding (MoU) governed by German law that establishes the preliminary framework for a business relationship between a supplier and buyer. This document outlines the intended cooperation, key commercial terms, and general principles of the relationship while maintaining its primarily non-binding nature. It incorporates relevant provisions from the German Civil Code (BGB) and Commercial Code (HGB), addressing aspects such as confidentiality, communication protocols, and the general framework for future business dealings. The document serves as a stepping stone towards more detailed, binding agreements while providing clear structure and guidance for the initial phase of the business relationship.

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What is a Memorandum Of Understanding Between Supplier And Buyer?

The Memorandum Of Understanding Between Supplier And Buyer is a crucial preliminary document used when two companies intend to establish a business relationship but are not yet ready to enter into a fully binding contract. This document, governed by German law and incorporating principles from the BGB and HGB, typically precedes more detailed supply agreements or master service agreements. It outlines the basic commercial understanding, confidentiality obligations, and framework for cooperation while maintaining flexibility. The MoU is particularly valuable during initial negotiations, helping parties align their expectations and document key points of understanding while conducting due diligence or finalizing commercial terms. It's especially useful in complex supply relationships where detailed agreements may take time to negotiate, or when parties need to establish basic principles before committing to a full contractual relationship.

What sections should be included in a Memorandum Of Understanding Between Supplier And Buyer?

1. Parties: Identification and details of the supplier and buyer, including full legal names, registration numbers, and registered addresses

2. Background: Context of the relationship and purpose of the MOU, including the general intent of both parties

3. Definitions: Key terms used throughout the document, ensuring consistent interpretation

4. Purpose and Scope: Detailed description of the intended collaboration and its boundaries

5. Non-Binding Nature: Clear statement about which provisions are non-binding and which (if any) are intended to be legally binding

6. Duration and Termination: Timeline of the MOU, including start date and termination provisions

7. Confidentiality: Obligations regarding the protection and handling of confidential information

8. General Framework of Cooperation: Basic principles governing how the parties will work together

9. Communication: Methods and protocols for communication between parties

10. Costs and Expenses: How costs associated with the cooperation will be handled

11. Governing Law: Specification of German law as the governing law

12. Signatures: Execution section for authorized representatives of both parties

What sections are optional to include in a Memorandum Of Understanding Between Supplier And Buyer?

1. Exclusivity: Include when parties wish to establish exclusive dealing arrangements

2. Intellectual Property Rights: Include when the cooperation involves sharing or creating intellectual property

3. Quality Standards: Include when specific quality requirements or standards need to be maintained

4. Volume Commitments: Include when parties wish to indicate expected supply volumes

5. Dispute Resolution: Include when parties want to specify particular dispute resolution mechanisms

6. Insurance Requirements: Include when specific insurance coverage needs to be maintained

7. Compliance with Laws: Include when specific regulatory compliance needs to be highlighted

8. Force Majeure: Include when parties want to address handling of unforeseen circumstances

What schedules should be included in a Memorandum Of Understanding Between Supplier And Buyer?

1. Schedule 1 - Product Specifications: Detailed technical specifications of products or services to be supplied

2. Schedule 2 - Pricing Framework: Indicative pricing structure or methodology

3. Schedule 3 - Contact Details: Key contact persons and their details for both parties

4. Schedule 4 - Timeline and Milestones: Proposed timeline for implementation and key milestones

5. Appendix A - Compliance Requirements: Specific compliance requirements and standards to be followed

6. Appendix B - Form of Future Agreement: Template or key terms for potential future binding agreement

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Germany

Publisher

Ƶ

Cost

Free to use

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