{"id":14334,"date":"2020-10-17T16:58:31","date_gmt":"2020-10-17T11:28:31","guid":{"rendered":"https:\/\/swaritadvisors.com\/learning\/?p=14334"},"modified":"2020-10-24T22:39:10","modified_gmt":"2020-10-24T17:09:10","slug":"complete-guide-on-memorandum-of-understanding-format-mou","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/","title":{"rendered":"A Complete Guide on Memorandum of Understanding Format"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The term Memorandum of Understanding Format denotes the Performa of an agreement that is signed between the parties. This legal document describes the rights and duties of the parties involved. <\/p>\n\n\n\n<p>Further, it shall be relevant to state that all the terms and conditions stated in an MOU are mutually agreed.<\/p>\n\n\n\n<p>In this blog, we will discuss the concept of the <a href=\"https:\/\/swaritadvisors.com\/memorandum-of-understanding\"><strong>Memorandum of  Understanding Format<\/strong><\/a>, together with the process to draft it.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3a73e4e1b1e\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3a73e4e1b1e\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Features_of_MOU\" title=\" Features of MOU \"> Features of MOU <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Benefits_of_a_Memorandum_of_Understanding_Format\" title=\"Benefits of a Memorandum of Understanding Format\">Benefits of a Memorandum of Understanding Format<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Clauses_of_Memorandum_of_Understanding_Format\" title=\"Clauses of\nMemorandum of Understanding Format\">Clauses of\nMemorandum of Understanding Format<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Purpose_of_Memorandum_of_Understanding_Format\" title=\"Purpose of Memorandum of Understanding Format\">Purpose of Memorandum of Understanding Format<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Documents_Required_for_Drafting_MOA\" title=\"Documents Required\nfor Drafting MOA\">Documents Required\nfor Drafting MOA<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Process_of_Drafting_Memorandum_of_Understanding_Format\" title=\"Process of Drafting\nMemorandum of Understanding Format\">Process of Drafting\nMemorandum of Understanding Format<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Legality_of_MOU_in_India\" title=\"Legality of MOU in\nIndia\">Legality of MOU in\nIndia<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Enforceability_of_Memorandum_of_Understanding_Format\" title=\"Enforceability of\nMemorandum of Understanding Format\">Enforceability of\nMemorandum of Understanding Format<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Stamp_Duty_on_MOU_Format\" title=\"Stamp Duty on MOU\nFormat\">Stamp Duty on MOU\nFormat<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/swaritadvisors.com\/learning\/complete-guide-on-memorandum-of-understanding-format-mou\/#Performa_of_Memorandum_of_Understanding_Format\" title=\"Performa of Memorandum of Understanding Format\">Performa of Memorandum of Understanding Format<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Features_of_MOU\"><\/span> <strong>Features of MOU<\/strong> <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The <strong><em>features of a Memorandum of Understanding<\/em><\/strong>\nare as follows:<\/p>\n\n\n\n<ol><li>An MOU must\ninclude the Name and Details of the parties involved;<\/li><li>It must specify\nthe Purpose and Objective of drafting MOU;<\/li><li>All the details\nregarding the Meetings must be clearly mentioned;<\/li><li>A Memorandum of\nUnderstanding must specify the Amount of Capital contributed by each party;<\/li><li>It must contain\nthe details concerning the Authorities eligible to take Major Financial\nDecisions;<\/li><li>An MOU must\ninclude all the details regarding the financial record keeping of the\nassignment or program being undertaken;<\/li><li>It must include\nthe roles, duties, responsibilities, remuneration, etc., of every party\ninvolved;<\/li><li>It should include\ndetails regarding a person who is authorised to manage the day to day affairs\nand operations of the program;<\/li><li>Once the MOU is\nduly drafted, it needs to be mandatorily signed by both the parties;<\/li><li>An MOU must\ninclude the duration of the agreement signed. Further, the term \u201cduration\u201d\nincludes the starting and ending date of the agreement;<\/li><li>It should include\nthe situations in which the agreement signed stands terminated;<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benefits_of_a_Memorandum_of_Understanding_Format\"><\/span><strong>Benefits of a<\/strong> Memorandum of Understanding <strong>Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Benefits-of-an-MOU-Format-heading-1.jpg\" alt=\"MOU Format Benefits\" class=\"wp-image-14394\" width=\"663\" height=\"306\" srcset=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Benefits-of-an-MOU-Format-heading-1.jpg 1000w, https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Benefits-of-an-MOU-Format-heading-1-300x138.jpg 300w, https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Benefits-of-an-MOU-Format-heading-1-768x354.jpg 768w\" sizes=\"(max-width: 663px) 100vw, 663px\" \/><\/figure><\/div>\n\n\n\n<p>The <strong><em>benefits of an MOU Format<\/em><\/strong> are as\nfollows:<\/p>\n\n\n\n<ol><li>Establishes a\nCommon Intention between the parties;<\/li><li>Reduces the Risk\nof Uncertainty;<\/li><li>Records Previous Agreements;<\/li><li>Eases out Engagements;<\/li><li>Offers a\nRegulatory Framework for Future Dealings;<\/li><li>Secures a\nPartnership;<\/li><li>Saves Time and\nMoney;<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Clauses_of_Memorandum_of_Understanding_Format\"><\/span><strong>Clauses of\nMemorandum of Understanding Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Clauses-of-Memorandum-of-Understanding-Format-heading-1.jpg\" alt=\"MOU Format clauses\" class=\"wp-image-14353\" width=\"359\" height=\"937\" srcset=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Clauses-of-Memorandum-of-Understanding-Format-heading-1.jpg 383w, https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Clauses-of-Memorandum-of-Understanding-Format-heading-1-115x300.jpg 115w\" sizes=\"(max-width: 359px) 100vw, 359px\" \/><\/figure><\/div>\n\n\n\n<p>The <strong><em>essential clauses of a Memorandum of\nUnderstanding Format<\/em><\/strong> are as follows:<\/p>\n\n\n\n<ol><li>Objective or Purpose of signing an MOU;<\/li><li>Roles and Responsibilities of each Party;<\/li><li>Meetings and Manner of Reporting;<\/li><li>Details regarding the Technical and Financial Support, if in case any;<\/li><li>Financial Consideration, if in case, involved in the transaction;<\/li><li>Person responsible for managing the day-to-day affairs;<\/li><li>Duration of an MOU;<\/li><li>Clause of Confidentiality;<\/li><li>Conditions resulting in the Termination of MOU;<\/li><li>Possibility of Extension;<\/li><li>Modes of Communication;<\/li><li>Clause of Severability;<\/li><li>Arbitration Clause;<\/li><li>Clause of Indemnity, etc.;<\/li><\/ol>\n\n\n\n<p><b>Also, Read:<\/b> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/how-to-change-of-name-of-the-company-complete-procedure\/\"><strong>Steps to Change of Name of the Company: A Complete Guide<\/strong><\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Purpose_of_Memorandum_of_Understanding_Format\"><\/span><strong>Purpose of <\/strong>Memorandum of Understanding <strong>Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Purpose-of-MOU-Format.jpg\" alt=\"MOU format purpose\" class=\"wp-image-14339\" width=\"625\" height=\"213\" srcset=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Purpose-of-MOU-Format.jpg 1000w, https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Purpose-of-MOU-Format-300x102.jpg 300w, https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/Purpose-of-MOU-Format-768x261.jpg 768w\" sizes=\"(max-width: 625px) 100vw, 625px\" \/><\/figure><\/div>\n\n\n\n<p>The <strong><em>objectives of a MOU Format<\/em><\/strong> are as follows:<\/p>\n\n\n\n<ol><li>Clarifies the objective of the project for the benefit of\nthe members;<\/li><li>Covers all the statements that are negotiated between the parties;<\/li><li>Gather the details regarding the loan taken in one of the\nstatement; <\/li><li>Surveys the capacity of the other party to achieve the task;<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Documents_Required_for_Drafting_MOA\"><\/span><strong>Documents Required\nfor Drafting MOA<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It shall be worthy to note that as such no specific documents are needed for drafting and executing a Memorandum of Understanding Format.<\/p>\n\n\n\n<p>However, the basic details of the parties, such as <em>ID Proofs, Names, and Permanent Address,<\/em> must be provided for the process of scrutiny.<\/p>\n\n\n\n<p>Moreover, the paper evidencing the rights\nof the parties to carry out the business as per the regulation of MOU and\nprovide the service in question could be scrutinized as well.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Process_of_Drafting_Memorandum_of_Understanding_Format\"><\/span><strong>Process of Drafting\nMemorandum of Understanding Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The steps involved in the process of Drafting Memorandum of Understanding Format are as follows:<\/p>\n\n\n\n<ol><li>First,\nIdentify the Parties to the MOU (Memorandum of Understanding);<\/li><li>Now,\nunderstand the objective and aim of creating this MOU;<\/li><li>After\nthat Plan the requirements for achieving these objectives;<\/li><li>Decide\nthe duties, roles and responsibilities of each party;<\/li><li>Decide\non the events when such an MOU becomes inapplicable;<\/li><li>Plan\non sharing the economic benefits;<\/li><li>Covers\nthe clauses where it provides the circumstances where one of the parties has\nthe right to can the MOU;<\/li><li>Start\ndrafting Memorandum of Understanding with professional assistance;<\/li><li>A final draft of the MOU will be sent for review\npurpose;<\/li><li>Both the parties must sign the MOU drafted;<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Legality_of_MOU_in_India\"><\/span><strong>Legality of MOU in\nIndia<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It shall be pertinent to mention that an <strong>MOU <\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Memorandum_of_understanding\"><strong><em>[1]<\/em><\/strong><\/a><\/sup> does not create any legally enforceable obligation. That means it is a non-binding contract that defines the intention of the businesses or parties involved.<\/p>\n\n\n\n<p>However, if an MOU has been drafted for consideration, such as for the exchange\nof money, etc., then the said document will have a binding effect on the parties.<\/p>\n\n\n\n<p>Also, the intent of the parties involved can be decoded from the\nmaterial provisions and contents of the MOU. <\/p>\n\n\n\n<p>Moreover, the clauses, such as Applicable Law, Jurisdiction,\nIndemnification, etc., will have a binding impact on the agreement. &nbsp;<\/p>\n\n\n\n<p>Therefore, the legality of an MOU depends on the duties, rights,\nobligations, it creates among the parties involved.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Enforceability_of_Memorandum_of_Understanding_Format\"><\/span><strong>Enforceability of\nMemorandum of Understanding Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In India, an MOU is governed by the provisions of the Indian Contract\nAct 1872. Further, if the conditions stated under the Indian Contract Act are\nduly satisfied, then the performance of a Memorandum of Understanding can be\nenforced under the provisions of the Specific Relief Act 1963.<\/p>\n\n\n\n<p>Moreover, as per the provisions of the Specific Relief Act, a relief is\ngranted only when the parties cannot determine the compensation in monetary\nterms.<\/p>\n\n\n\n<p>However, it shall be relevant to state that in case the conditions mentioned\nunder the Indian Contract Act, 1872, are not fulfilled, then the Memorandum of\nUnderstanding Format will not be recognised as a legally enforceable contract. But\nthen again, it shall be relevant to state that the court of law has the power\nto enforce an MOU based on the principles of \u201cpromissory estoppels and equity\u201d.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Stamp_Duty_on_MOU_Format\"><\/span><strong>Stamp Duty on MOU\nFormat<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There is no need to pay any Stamp Duty on the\nMemorandum of Understanding Format. However, it shall be relevant to mention\nthat in case the value of the property involved is more than Rs 100\/-, then the\nparties must get the document stamped on a mandatory basis to use it as legal\nevidence before the court of law.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In a nutshell, an MOU plays a\nsignificant role in the business world. Further, it does not involve any transaction\nregarding the exchange of money. <\/p>\n\n\n\n<p>Also, a Memorandum of Understanding\nFormat is not legally binding until stamped. However, if in case there is an\nexchange of money, then the document will be considered as a legally binding\ncontract.<\/p>\n\n\n\n<p>In case of any other doubt, visit <strong><span style=\"text-decoration: underline;\">Swarit Advisors<\/span><\/strong>, our experts will assist you in drafting a Memorandum of Understanding.<\/p>\n\n\n\n<p><b>Also, Read:<\/b> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/learning\/alteration-of-moa-guide-to-alter-memorandum-of-association\/\"><strong>Guide to Alter Memorandum of Association<\/strong><\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Performa_of_Memorandum_of_Understanding_Format\"><\/span><strong>Performa of Memorandum of Understanding Format<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n<a href=\"https:\/\/swaritadvisors.com\/learning\/wp-content\/uploads\/2020\/10\/LTMOU.pdf\" class=\"pdfemb-viewer\" style=\"\" data-width=\"max\" data-height=\"max\"  data-toolbar=\"bottom\" data-toolbar-fixed=\"off\">LTMOU<br\/><\/a>\n<p class=\"wp-block-pdfemb-pdf-embedder-viewer\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The term Memorandum of Understanding Format denotes the Performa of an agreement that is signed between the parties. This legal document describes the rights and duties of the parties involved. Further, it shall be relevant to state that all the terms and conditions stated in an MOU are mutually agreed. In this blog, we will [&hellip;]<\/p>\n","protected":false},"author":17,"featured_media":14336,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[628,380,666,615],"tags":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/14334"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/comments?post=14334"}],"version-history":[{"count":20,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/14334\/revisions"}],"predecessor-version":[{"id":14686,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/posts\/14334\/revisions\/14686"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media\/14336"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/media?parent=14334"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/categories?post=14334"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/learning\/wp-json\/wp\/v2\/tags?post=14334"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}