What is a memorandum of understanding?
A memorandum of understanding (MOU) is a formal agreement between two or more parties, indicating that the parties have reached an understanding and broadly outlining what has been agreed upon.
Law enforcement agencies and jurisdictions can formalise the terms of exchange through an MOU, setting out how information will be exchanged in combating international crime and providing greater transparency.
The Australian Law Reform Commission states that MOUs generally do not have the force of law, but that they may regulate the exchange of information by formalising the terms of a relationship or framework for cooperation between the parties.
How are MOUs used by courts in matters of international law?
MOUs are used by courts to specify how they will work together on legal issues, and this is happening on an increasingly global scale. We look at the MOUs between the Supreme Court of NSW and various other international courts.
The U.S. and Singapore
In June 2010, the Supreme Court of NSW entered into an MOU with the Supreme Court of Singapore to work on issues arising under foreign law. This was viewed as an innovative development in international judicial cooperation, and served as a template for developing an MOU between the Chief Justice of New South Wales and the Chief Judge of the state of New York on references of questions of law in December 2010.
The terms of both MOUs include that:
- If one country is dealing with an issue governed by the rule of law of another, assistance will be provided in having the issue determined by the courts of the Party of the governing law.
- This assistance will be provided as expeditiously as possible in accordance with domestic rules and procedures.
- Differences that may arise through the process will be settled amicably.
Three further memoranda of understanding were entered into by the Supreme Court of NSW in 2011 to widen the areas of cooperation between Australia and China:
- MOU between the High People’s Court of Guandong Province, the People’s Republic of China and the Supreme Court of NSW.
- MOU between the High People’s Court of Hubei Province, the People’s Republic of China and the Supreme Court of NSW.
- MOU between the High People’s Court of Shanghai, the People’s Republic of China and the Supreme Court of NSW.
The terms of these MOUs include that:
- Cooperation between the courts will be promoted.
- On-site visits will be facilitated to promote the acquisition of knowledge on the judicial system of each court.
- Judges of one Party may be invited to attend specific workshops, conferences or seminars organised by the other.
- The MOU constitutes a statement of intent rather than a formal agreement.
Termination of MOU
An MOU comes into effect on the date of signing, and may be terminated by any Party by giving written notice. Termination will take effect after a certain period following the date of notice, as outlined in the MOU (3-6 months).
The MOU may also stipulate a default date of termination at some point in the future, after which time it is anticipated that the procedures will be sufficiently well established not to require a succeeding agreement.
Memoranda of Guidance
A Memorandum of Guidance is typically a much more detailed document than a Memorandum of Understanding, outlining the requirements and procedures for the enforcement of each participant’s judgments in the other participant’s courts.
In 2013, a Memorandum of Guidance was effected between the Dubai International Financial Centre (DIFC) Courts and the Supreme Court of NSW. This memorandum is concerned only with judgments requiring a person to pay a sum of money to another person.