Ann: India Project Agreement Clarification, page-23

I am a lawyer, and I am amused by the flurry of concern raised by wikipedia experts over the differences between an MOU, MOA and Heads of Agreement, and the extent to which the terms may or may not be legally binding.

I'll let you in on a little secret: It doesn't matter!

In business the important thing is the relationship between the parties, the degree to which they share common goals, and their desire to work together.

Legal documents are only there to sort out the mess as to who gets what share of the blame when it all goes pear shaped.

If the project falters, I suspect that the best drafted legally binding document in the world will not save ECT from collapse. Nor will they likely have the resources remaining to extract vengeance through the (probably) Indian court system.

So I look to the actions of the parties. Given the amount of review, and the level of approval given, I have no doubt that the pilot plant will be built. The Indians want it to succeed just as much as ECT do.

What happens beyond that, and whether it proceeds to a commercial plant, and on what terms are all issues for another day. Responsibilities and rewards for the final operations of plants worldwide cannot be realistically allocated now. More information is needed from the operation of the pilot plant before the shape of a final project can be determined, along with who does what, and who gets what.

Undoubtedly that will be a matter for further negotiation far down the track, and will hopefully generate much work for all the lawyers to document after the event.

At the end of the day it all depends on the goodwill of the parties, and their joint determination to achieve mutually beneficial business outcomes. Hopefully the documents are never needed to sort out a mess.