Document background
The Contractual Letter of Intent is a crucial preliminary document in Belgian business practice, typically used when parties are entering into significant business transactions or relationships and need to formalize their intentions before proceeding with detailed negotiations. It serves multiple purposes: documenting the key terms of the proposed transaction, establishing a framework for negotiations, and addressing important preliminary matters such as confidentiality and exclusivity. While generally non-binding in nature (except for specific provisions), under Belgian law, it carries significant weight in establishing the parties' good faith obligations during negotiations. The document is particularly important in complex transactions such as mergers and acquisitions, joint ventures, or significant commercial partnerships, where parties need to demonstrate their serious intention to proceed while still maintaining flexibility for detailed negotiations. Given Belgium's position in the EU and its role as a hub for international business, these Letters of Intent often facilitate both domestic and cross-border transactions.
