Document background
The Memorandum of Contract is a crucial document in Austrian business practice, particularly useful in complex transactions where parties need to document their preliminary agreements while maintaining flexibility for future negotiations. It serves as a bridge between initial discussions and the final contract, capturing key commercial terms, conditions, and timelines. Under Austrian law, particularly the ABGB, such memoranda can have binding effect on certain terms while leaving others open for further negotiation. This document type is commonly used in business combinations, real estate transactions, joint ventures, and other significant commercial arrangements where parties need to establish clear framework before proceeding with detailed due diligence or final documentation. The Memorandum of Contract typically includes essential elements such as party details, transaction structure, key commercial terms, conditions precedent, and next steps, while complying with Austrian formal requirements for preliminary agreements.
