DIFFERENCE BETWEEN MEMORANDUM OF UNDERSTANDING

& MEMORANDUM OF

ASSOCIATION

MEMORANDUM OF UNDERSTANDING (MOU) 

Defines a “general area of understanding” within both parties' authorities and no transfer of funds for services is anticipated. MOUs often state common goals and nothing more.

An MOU may be used to outline the operation of a program so that it functions a certain way. For example, two agencies that have similar goals may agree to work together to solve a problem or support each other’s activities by using an MOU. The MOU is nothing more than a formalized handshake.

In international public law, a memorandum of understanding is used frequently. It has many practical advantages when compared with treaties. When dealing with sensitive or private issues, the document can be kept confidential, while a treaty cannot.

It can also be put into effect in a timelier manner than a treaty, because it doesn't require ratification. In addition, a memorandum of understanding can be modified without lengthy negotiations, which is especially useful, except in multilateral situations. Most transnational aviation agreements are this type of agreement.

An example of an international memorandum of understanding is the Oil For Food Program, which was created by the United Nations in 1995 and lasted until 2003. This agreement allowed Iraq to sell its oil to the world in exchange for humanitarian help, such as food and medicine for Iraqi civilians. It did not, however, allow Iraq to rebuild its military.

MEMORANDUM OF AGREEMENT (MOA)

A Memorandum of Association (MOA) is a legal document prepared in the formation and registration process of a limited liability company to define its relationship with shareholders.

The MOA is accessible to the public and describes the company's name, physical address of registered office, names of shareholders and the distribution of shares.

The MOA and the Articles of Association serve as the constitution of the company.

In times past this document, sometimes known simply as a memorandum, required a number of details that are not typically included in the articles of incorporation that are filed at the time a business is formally incorporated.  

 

A memorandum of association is required as part of the documentation necessary for incorporation in a number of nations, including the United Kingdom, India, and Ireland, as well as other nations around the world.

In times past, one of the functions of a memorandum of association was to define the scope of external activities that the business would engage in once it was properly incorporated.

To some extent, this is still true in many nations, in that the text must provide a general concept of what the business will provide in terms of goods or services.

In recent years, the depth of detail required within the document has shifted to more general data, while more specific information is required in other documents that must also be submitted as part of the incorporation process.