From signing an MoU to delivering cooperation: why do so many agreements produce nothing?

In shipping, the signing of cooperation agreements between ports, maritime authorities or shipping lines often comes with wide media coverage. Experience shows, however, that a high share of these agreements stall at implementation. The lack of implementing mechanisms and neglect of the legal and practical dimensions of the text are the main causes of this organisational inaction.

Zoom

1. The variable legal nature of MoUs: wording and the parties’ intention

A common mistake is to treat every MoU either as “fully binding” or, conversely, as “purely symbolic and without effect”. Under the Vienna Convention on the Law of Treaties (1969) and international law doctrine, the legal effect of a document does not depend on its title but on the common intention of the parties, the nature of the commitments and the wording of the text. Using mandatory terms such as “shall”, or including explicit financial or jurisdictional commitments, may indicate an intention to create obligations in a legal assessment (depending on the law of each jurisdiction); yet no single word decides whether a text is binding without assessing the full text, the parties and the governing law.

2. Closing the implementation gap: ownership of commitments, resources and a six-month action plan

The central reason MoUs fail is that they are left alone after the signing ceremony, with no implementing structure:

• An action owner and a coordination structure: an agreement without an owner is a dormant agreement. A joint steering committee with an accountable representative from each side keeps the follow-up going.
• An operational plan and resources: each general clause of the MoU must be turned into a concrete implementing project with a timetable and budget.
• Milestones and measurable KPIs: defining measurable outputs over set periods makes periodic assessment of progress possible.

A hypothetical example of a six-month monitoring mechanism (a training scenario only):

• Implementation owner: the deputy directorate for port and transit affairs in the port authority.
• Month-two milestone: the first meeting of the joint technical committee and finalisation of the protocol for electronic exchange of berth scheduling data.
• Review metric: a 30 per cent reduction in ships’ time at berth in the two partner ports within six months.

Three strategic questions for sustained MoU implementation

Before entering new agreements, senior managers should answer three key questions:

1. The partner’s institutional capacity and will: does the other party have the technical capability, financial resources and administrative authority needed to deliver its commitments?
2. A calendar of periodic review: have quarterly review meetings been planned to assess progress and remove obstacles to implementation?
3. A link to individual and organisational performance indicators: have the tasks in the MoU been included in the work priorities and performance records of the managers concerned?

Management conclusion

A maritime MoU that is not linked to a chain of clear administrative responsibilities, allocated resources and periodic monitoring will go no further than a diplomatic statement. The governance maturity of a maritime authority shows in its ability to turn paper agreements into operational value.