Document background
The MOU Sales Agreement is a preliminary document used in Malaysian business transactions to establish the framework for future sales arrangements between parties. It serves as a stepping stone toward a more detailed, binding agreement while allowing parties to document their initial understanding and commitment to negotiate. This document type is particularly valuable when parties need to establish clear intentions and basic commercial terms before investing significant resources in due diligence or detailed contract negotiations. The MOU includes key commercial points such as proposed pricing, volume commitments, and delivery terms, while maintaining flexibility for future negotiations. Under Malaysian law, while most provisions are non-binding, certain clauses such as confidentiality and exclusivity can be structured as binding obligations. This document is commonly used in both domestic Malaysian transactions and international trade arrangements where at least one party is based in Malaysia.
