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Structure and Legal Nature of Cooperation Agreements

Cooperation agreements are not specifically defined in the legislation and, therefore, there is no clear framework for determining which contracts may constitute cooperation agreements. Cooperation agreements are so-called hybrid agreements. When concluding the agreement, the main issue is to define what is being agreed, and what the objective of the agreement is.

The more intensive the intended cooperation, the more likely it is that the cooperation agreement will include characteristics of different kinds of agreements. Which characteristics will be used for the cooperation agreement depends largely on the nature of the cooperation. For instance, development of software usually requires both financial resources and know-how. In a cooperation agreement regarding such projects, it may be agreed, for instance, that one of the parties will provide the financial resources required for the project, whereas the other party will carry out the research. The same agreement may also be used to agree upon distribution of project results between the parties. As a result, the agreements may include characteristics of both license [Licence Agreement] and financing agreements [Financing Agreement].

A cooperation agreement may also consist of several separate agreements. If cooperation is governed by several agreements, it is important to ensure that they do not have discrepancies, or cancel out one another. The provisions of such agreements should be consistent. Therefore, when drafting the agreements, it is important to keep in mind the big picture and the objective of the cooperation.

The following issues should be taken into account when drafting a cooperation agreement:

  • parties and their representatives;

  • purpose of the agreement;

  • background information relating to the agreement;

  • defining terms used in the agreement;

  • content and timeline of and persons in charge for the cooperation;

  • management of the cooperation (e.g. the management group and other administration) and their duties;

  • obligations and liability of the parties;

  • use of subcontractors and their status;

  • rights of ownership and rights of use;

  • intellectual property rights, e.g. in respect of research results (ownership and transfer of such rights);

  • supervision of the cooperation and confidentiality in respect of confidential information and cooperation materials;

  • amendment and assignment of the agreement;

  • duration, termination and rescission of the agreement;

  • contractual penalties and liability for damages;

  • applicable law, language of the agreement and dispute resolution.