What is memorandum of understanding (MOU or MoU)? - Definition from WhatIs.com


memorandum of understanding (MOU or MoU)

Part of the Business terms glossary:

A memorandum of understanding (MOU or MoU) is a formal agreement between two or more parties. Companies and organizations can use MOUs to establish official partnerships.

MOUs are not legally binding but they carry a degree of seriousness and mutual respect, stronger than a gentlemen’s agreement. Often, MOUs are the first steps towards a legal contract. In US law, a memorandum of understanding is synonymous with a letter of intent (LOI), which is a non-binding written agreement that implies a binding contract is to follow.

MOUs are popular in multinational international relations because, unlike treaties, they take a short time to ratify and can be kept confidential. MOUs may also be used to modify existing legal treaties.

See also: prime contractdigital signature, contracting officer, partner relationship management, partner



Continue reading about memorandum of understanding:

Here is an example of a MoU between the National Science Foundation and NASA.

Oil-for-Food is an international MoU.

This was last updated in January 2011
Posted by: Margaret Rouse

Related Terms


  • swivel chair interface

    - A swivel chair interface is a system for user input and interaction that requires them to move from one interface to another, sometimes duplicating work. (WhatIs.com)

  • Alphabet, Inc.

    - Alphabet, Inc. is a conglomerate founded by Google to serve as its parent company; Google will continue to exist as a fully-owned subsidiary of Alphabet, as will Calico, Google Ventures, Google Cap... (WhatIs.com)

  • outcome economy

    - Outcome economy describes an economy based on the marketing, pricing and selling of the results provided by goods and services rather than their face value. (SearchCIO.com)


  • Business terms

    - Terms related to business, including definitions about project management and words and phrases about human resources, finance and vertical industries.

  • Internet applications

    - This WhatIs.com glossary contains terms related to Internet applications, including definitions about Software as a Service (SaaS) delivery models and words and phrases about web sites, e-commerce ...

Ask a Question About memorandum of understanding (MOU or MoU)Powered by ITKnowledgeExchange.com

Get answers from your peers on your most technical challenges

Tech TalkComment



    Contribute to the conversation

    All fields are required. Comments will appear at the bottom of the article.