According to Munir Fuady, the position of the MoU is divided into two:
  1. As a gentlemen's agreement: An MoU only has a moral bond, not a legal bond. If one party violates the MoU, it cannot be sued in court. Even if it is made with a notarial deed (although this rarely happens), the emphasis remains on the moral aspect without legal sanctions.
  2. As a binding agreement: An MoU can be considered an agreement (an agreement is an agreement) according to the principle in Pasal 1338 KUHPerdata. This article states that all agreements made legally apply like laws to the parties who make them. In this context, the MoU has binding legal force like a regular contract, depending on the content and clauses agreed upon by the parties.

2. Letter of Intent (LoI) or Letter of Intent

Letter of Intent(LoI) is a letter used as an initial statement of intent from one party to another. The LoI contains an offer of cooperation.The process is simple: one party sends an LoI to another party that it wants to cooperate with. If the offer is accepted, the receiving party will sign and send it back as a sign of initial approval. After that, the two parties will usually meet to follow up on the initial agreement into a more detailed contract.