Memorandum of Understanding (MOU)*

AGREEMENT BETWEEN THE UNITED NATIONS POPULATION FUND
(UNFPA) AND THE GOVERNMENT OF XX, MINISTRY OF HEALTH ON THE UTILIZATION OF UNFPA PROCUREMENT FACILITIES

WHEREAS, the United Nations Population Fund (the "UNFPA") was established to provide assistance to Governments in the field of population and;

WHEREAS, pursuant to its Financial Regulations UNFPA may provide supplies, equipment and services under reimbursable procurement arrangements at the request and on behalf of Governments, where such supplies, equipment and services are required for purposes related to UNFPA activities and are consistent with the aims and policies of UNFPA, on the basis of full payment, in advance of the procurement activities, to cover all costs, including insurance, connected with the procurement of such supplies, equipment and services; and

WHEREAS, UNFPA undertakes to assist MINISTRY OF HEALTH (the "Government") in the procurement of goods and supplies (the "Services"), consistent with the aims and policies of UNFPA, and in accordance with the Financial Regulations and Rules of UNFPA and the terms and conditions of this Agreement; and

WHEREAS, the Government desires to avail itself of the Services in accordance with the terms and conditions of this Agreement;

NOW THEREFORE, it is agreed as follows:

Section 1: Requests for Purchase of Goods

1.1 The Government shall submit to UNFPA formal written requests, detailing any requirements it wishes UNFPA to procure (the "Requests"). Requests may be transmitted to UNFPA by facsimile, provided the Request clearly shows the signature, full name and title of a duly authorized official of the Government, and provided that an original signed Request is delivered or mailed to UNFPA prior to or immediately after the facsimile transmission.

1.2 The Request shall provide the following information:

(a) Information indicating the name and type of project for which the goods are intended;
(b) Full details of the goods required, formulation, strength, unit of packaging, standards or specifications applicable;
(c) Quantity required of each item requested clearly specifying unit of purchase.

1.3 UNFPA expressly reserves the right, in its sole discretion, to accept or reject any such Request. The acceptance of any Request shall be subject to this Agreement.

1.4 Upon acceptance of the Request by UNFPA, a proforma invoice will be sent to the Government, covering the goods to be ordered and giving the total cost of the goods, pre-shipment inspection costs, and where applicable, insurance and freight costs, plus an amount sufficient to defray the administrative costs incurred by UNFPA in the provision of Services under this Agreement. Such costs are presently estimated to equal five per cent (5%) of the CIF value of the goods. The proforma invoice shall also specify an increment to be included in the Advance Payment to be made by the Government pursuant to Section 2 hereof to cover possible increases or other contingencies. Prices quoted in the proforma invoice will be subject to change without notice. Prices actually debited against the Advance Payment made by the Government may be higher or lower, and shall be based upon prices invoiced to UNFPA by the suppliers of the goods and of the actual costs of inspection, shipment services and insurance. The proforma invoice shall constitute notice to the Government that its Request has been accepted by UNFPA.

1.5 The Government shall be responsible for ensuring that the description of the goods and procurement units in the proforma invoice are in agreement with the Request.

1.6 Amendments to a Request, or cancellation or reduction of quantities already accepted by UNFPA, may be affected only with the prior written agreement of UNFPA. Any reduction or cancellation so agreed to will result in return to the Government of that portion of its Advance Payment representing the sums referred to in Section 1.4 above, in respect of the reduced or canceled quantities, less any costs, charges, expenses, and penalties arising from or relating to the reduction or cancellation. Any additions or increases to the Requests shall require additional Advance Payments. The Government shall be responsible for payment of any costs or penalties arising from a cancellation or reduction or increase of quantities.

Section 2: Advance Payment for the Services

2.1 Pursuant to UNFPA policy to ensure availability and receipt of funds prior to committing to any expenditure or processing any Requests, the Government shall pay, or make arrangements for payment to UNFPA, an Advance Payment for the provision of the Services. Depending on the source of funds, the following procedure will be followed for making the Advance Payment:

(a) In the event that the funds for the Services derive from the Government itself, the Government shall deposit with the UNFPA, within 30 days after the date of the proforma invoice, in U.S. dollars, or other convertible currency acceptable to the UNFPA, the amounts specified in the proforma invoice and in the currencies specified therein; said Advance Payment shall be deposited in the bank account specified in the proforma invoice. In the event that the actual costs of the Services exceed the deposited amount, the provisions of Section 2.3 below shall apply;

(b) In cases where the funds for the Services derive from funds provided to the Government by Multilateral Financing Institution (the "Institution"), the Government shall execute an irrevocable Blanket Withdrawal Request, with copy to UNFPA, covering the entire cost of the Services, pursuant to which the Institution will remit funds for the Services directly to UNFPA. Such Blanket Withdrawal Request shall be annexed to this Agreement and shall constitute an integral part thereof. Upon receipt by UNFPA of notice from the Institution that the Blanket Withdrawal Request from the Government has been approved, UNFPA shall submit a request to the Institution, with a copy to the Government, to make a direct payment in US dollars to the UNFPA's Account Number 323373925, SWIFT Address CHASUS33, at JP Morgan Chase Bank N.A., International Agencies Banking, 1166 Avenue of the Americas, 17th Floor, New York, NY 10036-2708 in an amount equal to the amount specified in the proforma invoice. In the event that the actual costs of the Services exceed the estimated amount, the provisions of Section 2.3 below shall apply mutatis mutandis;

(c) In the event that the funds for the Services derive from grants by donor Governments, the Services by UNFPA shall be provided only after conclusion of an agreement between UNFPA and the donor Government, covering, inter alia, the financial arrangements between the Parties.

2.2 No Request shall be acted upon by the UNFPA until the Advance Payment has been deposited with UNFPA.

2.3 Upon notification by UNFPA, the Government shall pay to UNFPA, or make arrangements for the deposit of any additional funds if, for any reason, including currency rate changes or price changes in respect of the goods or incidental charges, the Advance Payments originally made pursuant to Section 2.1 above are no longer sufficient to cover the cost of the goods and all other incidental charges. The processing of a Request shall not be continued or pursued by UNFPA until the additional funds are deposited.

Section 3: Procurement and Shipment

3.1 Within a reasonable period of time after accepting a Request and after the Advance Payment or any additional funds have been deposited by the Government, UNFPA shall procure the goods on behalf of the government for shipment directly from the supplier to the Government. UNFPA's procurement of goods on behalf of the Government will be made in accordance with UNFPA's Financial Regulations and Rules.

3.2 All goods will be procured on the basis of CIF terms (for carriage by sea and inland waterway) or CIP terms (for any other mode of shipment) (INTCOTERMS 1990).

3.3 UNFPA shall make provision for inspection of purchases prior to shipment and the cost of such inspection shall be debited to the Government's Advance Payment, or otherwise charged to the Government, as part of the cost of the services provided under this Agreement.

3.4 Upon shipment of the purchases, UNFPA will forward to the Government copies of the relevant shipping documents.

3.5 If any import or export licenses are required for the goods and are not obtained by the supplier, the Government shall obtain licenses.

3.6 The Government shall be responsible for and shall bear and pay all costs associated with the carriage and insurance of the goods. The Government shall also be responsible for, and shall bear and pay all costs associated with the clearance, receipt, inspection upon delivery, loading, unloading, storage, insurance, transport and distribution of the goods, except with respect to such services or costs as are arranged or borne, as the case may be, by the supplier of the goods.

3.7 UNFPA shall not be nominated the consignee of the goods without explicit written agreement from UNFPA. Special customs, product registration and consular requirements in the recipient country shall be deemed unknown by UNFPA unless clearly stated in the Request; however, the fulfillment of such requirements shall be the exclusive responsibility of the Government.

3.8 UNFPA cannot accept any return of supplies shipped for the account of the Government.

Section 4: UNFPA's Liability

4.1 UNFPA's sole responsibility to the Government in respect of the Services shall be limited to the execution with reasonable diligence and efficiency of a Request accepted by the UNFPA as herein provided. UNFPA shall have no legal liability either to the Government or to any third party arising out of or in connection with the performance of the Services and shall not be responsible for, inter alia, loss or damage to the goods or for delays or failures in shipment or delivery of the goods, except if due to UNFPA's failure to execute the Request with reasonable diligence and efficiency.

4.2 In no event shall any liability of UNFPA to the Government or to any third person, whether such liability arises under this Agreement or otherwise, exceed the purchase price of goods in respect of which the liability arises. Moreover, UNFPA shall under no circumstances be liable for any indirect or consequential damages arising from the performance of the Services under this Agreement.

Section 5: Claims

5.1 The Government recognizes that, in the performance of the Services under this Agreement, UNFPA will be acting on behalf of the Government, and not as agent of the supplier of the goods or any other persons or entities. Consequently, all claims relating to any defects in quality or quantity shall be handled directly by and between the Government and the manufacturer(s), supplier(s), seller(s), shipper(s), or insurer(s).

5.2 The Government shall indemnify, defend and hold and save harmless, at the Government's own expense, UNFPA, its agents, servants and employees, from and against all and any demands, claims, suits or other causes of action and liability of any nature or kind, including costs and expenses, caused by, arising out of or in connection with the goods or the use thereof (including, but not limited to, demands, claims, suits, causes of action or liability based on products liability) or the performance by UNFPA of the Services under this Agreement.

Section 6: Warranty

UNFPA shall pass on to the Government all warranties offered by the manufacturer(s) or supplier(s) of the goods, and shall ensure that all contracts with the manufacturer(s), supplier(s), seller(s), shipper(s) or insurer(s) include provision covering product liability claims. UNFPA offers no warranty, expressed or implied, of any nature whatever, including warranties that the goods are merchantable or fit for any particular purpose.

Section 7: Conditions of the Agreement

7.1 The obligations of UNFPA under this Agreement shall be conditional upon:

(a) the deposit of the Advance Payments and additional funds in accordance with Section 2.1 (a) or (b) of this Agreement, in the event that the Services are funded by the Government or by an Institution;

(b) the conclusion of an Agreement between UNFPA and the donor Government in accordance with Section 2.1 of this Agreement in cases where the funds for the Services are provided by a donor Government.

7.2 Nothing in this Agreement shall require, or be construed to require UNFPA to take any action in violation of the mandate of UNFPA or to contravene any of the UNFPA policies, regulations, rules and procedures.

Section 8: Representatives and Warranties of Parties

8.1 Each Party represents and warrants to the other that:

(a) such Party has full power and authority to enter into this Agreement and to consummate the transaction contemplated hereby;

(b) all consents, approval, authorizations and other requirements prescribed by any law, rule or regulation that must be obtained or satisfied by a Party as are necessary for such Party's execution and implementation of this Agreement or the performance of the terms hereof have been obtained and satisfied.

Section 9: Reports and Final Account

9.1 UNFPA shall provide to the Government reports and financial statements concerning the expenditures incurred for the provision of Services under this Agreement, in accordance with UNFPA's rules and procedures.

9.2 After shipment of all purchases, UNFPA shall prepare a final statement of account expressed in U.S. dollars, to be forwarded to the Government, covering the total cost of the Services.

9.3 In the event that the final statement of account indicates a balance of funds in favor of the Government, these funds shall, unless otherwise requested by the Government, be returned to the Government.

9.4 The United Nations operational rate of exchange shall apply to all currency conversions under this Agreement.

Section 10: Settlement of Disputes

Any dispute, controversy or claim arising out of or relating to this Agreement, or the breach, termination or invalidity thereof, shall, unless it is settled by direct negotiations, be settled by arbitration in accordance with the UNCITRAL Arbitration Rules as at present in force. UNFPA and the Government agree to be bound by any arbitration award rendered as a result of such arbitration, as the final adjudication of such dispute, controversy or claim.

Section 11: Privileges and Immunities

Nothing contained in or relating to this Agreement shall be deemed a waiver, expressed or implied, or any of the privileges and immunities of the United Nations, including UNFPA.

Section 12: Amendment, Suspension and Termination

12.1 This Agreement may be altered, modified or amended only by a written instrument duly executed by both Parties hereto.

12.2 This Agreement may be suspended by written notice from the suspending Party if: (a) the other Party has failed in any material respect to perform its obligations hereunder and such failure shall continue for a period of thirty (30) days after the party seeking to suspend has given the other Party notice of such failure, or (b) an event beyond the reasonable control of such Party occurs which makes it impossible for that Party to carry its obligations under this Agreement.

12.3 If this Amendment is suspended, neither Party shall be obligated to undertake additional responsibilities hereunder during the period of suspension (which period may continue for as long as the breach remains unremedied); provided, however, that the Parties shall comply with their obligations and responsibilities already incurred or commenced prior to such suspension. A Party suspending this Agreement shall retain the right to terminate this Agreement by providing notice of such termination to the other Party.

12.4 This Agreement may be terminated without prejudice to the rights of either Party by written notice of either Party, effective sixty (60) days after the date of such notice. Upon termination of this Agreement, the Parties shall take all reasonable and necessary measures to conclude the Services already commenced under this Agreement.

12.5 Suspension or termination of this Agreement for any reason shall not release either Party from any obligations that have already been undertaken at such time and shall not affect the survival of any right, duty or obligation of either Party. In particular, suspension or termination of this Agreement shall not relieve either Party of its obligation to pay all monies due to the other Party for services performed and obligations incurred prior to the effective date of such suspension or termination.

12.6 Upon cancellation of this Agreement, the Parties shall take all reasonable and necessary measures to conclude the services already commenced to permit orderly settlement of accounts between the Parties.

Section 13: Entry in Force

This Agreement shall enter into force on the date when it has been signed by both Parties. However, if by that date the Government has not deposited, or made arrangements for the deposit of the funds covering the costs for the provision of the Services by UNFPA, this Agreement shall enter force on the date when these requirements have been satisfied.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on ____________ at ____________.

*Also see simplifed Memorandum of Understanding available in the Forms section.