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Preliminary Agreements

It may already be necessary to exchange information within the future consortium during the drafting of the project proposal. To prevent the use of such information for other purposes (e.g. if the project does not get funded), Non-Disclosure Agreements (NDA) can be concluded in advance, precisely describing the information to be protected and include sanctions in case of violation.

Should further agreements appear necessary during the application phase or later in the project, these can be recorded in a separate declaration of intent, such as a Letter of Intent (LoI) or a Memorandum of Understanding (MoU).

An LoI often represents a unilateral declaration of intention and, together with the MoU, it sets out the roadmap for future contracts. In most cases, these agreements include mixed forms of pure declarations of intent, but also binding commitments. The LoI signals the willingness to enter into serious negotiations with the addressee about concluding a contract, without this already being associated with a binding offer (typical wording in the context of the LoI: "The contracting parties shall endeavour to.../intend to...").

In the European context, there are different modes of application to consider, depending on which law applies, which may have different implications when drafting the LoI. The LoI does not have any contract-creating effect according to the principles of German law, but is a mere declaration of intent. However, even if German law is applied, the caveat of a comprehensive final contract should be expressly included.

Often, claims for fault in the event of failure are excluded in an LoI, for example during the preparation of the Grant Agreement preparation (GAP). This provision should then, however, be expressly designated as binding. This also applies insofar as non-disclosure agreements are agreed in this letter of intent - instead of in a separate contract.
When preparing the above-mentioned documents, it is always advisable to contact the legal department of your own institution, to coordinate the project-specific details accordingly and, if necessary, to also consider the commonly used samples (templates) there.

 

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