THE ACTUAL DEAL

Once promising technology has been identified and ownership established, the time is right to make the deal. The first step will probably be the protocol. This is a document, signed by both parties, that establishes the intent of the parties and the timing for the next events. It is usually bilingual and sets the framework. This is an important document, and although it does not have the weight of a contract, is taken very seriously in these countries.

The actual contract will usually be simpler than those that are normally found in the West. It is best to have it written in bilingual format, with translations side by side. Careful attention should be placed on making sure that the translations (especially terminology) are accurate. Clauses that merit special attention are those related to payment, and risk of change in regulations covering currency conversion, money transfers, and taxes. The laws regarding these points change often, and can radically alter the merits of a deal. The contract should clearly state who is responsible for such changes, and their effect, if any, on contract price and payment terms.

Technology transfer has often been called a body contact sport. It is difficult under the best of circumstances. Moving technical know how across great distances, different cultures, and different languages, using communication paths that are often unreliable, makes it very difficult. There is no substitute for bringing the foreign expert to work beside your experts to transfer the technology. Notwithstanding the best intentions, it is not unusual for problems to arise. Some of the more common include the following:

Lack of Attention to Detail

The work product will be late, the wrong quantity of samples will be shipped, or their quality will not be as specified. The reasons for the problems can be numerous, such as a lack of raw materials, basic supplies, personnel, or equipment. To minimize the possibility of such problems requires close monitoring from your side -- more than would be necessary for a similar contract in the West. Such attention from you will ensure that you are aware that problems are developing and will allow you to bring resources to bear to prevent the problems from affecting your project. Thus, it is highly recommended that you budget some resources for problem solving in addition to the specified contract budget.

Compliance with Terms

Often if a scientist is asked to prepare a sample, the item that is delivered is not as specified. The common response is "but I did you a favor, I sent you something better." The most common reason that this occurs is because the western partner does not fully tell the FSU scientist why this work is being done and for what application. In their zeal to please, FSU scientists will second-guess the application and deliver something that is better, but not for the application intended. The best way to avoid this problem is to make the scientist a part of the team and have him understand the goal that you are trying to reach. This way, if something extra that the FSU scientist offers is delivered, it will really be better.

Enforcement of Terms

Contractual terms cannot be enforced unless there is a legal system that offers some recourse. The legal systems of all the new countries are evolving. It is difficult to rely on such uncertain legal grounds.

Some contracts specify another court in Europe as the arbiter of the terms of the contractual document. The merits of such an approach are uncertain because of potential enforcement difficulties with any judgment. A frequently heard refrain when the specifics of a contract are noted is "but things have changed" or "it's too complicated, you don't understand." These words are most often heard with reference to money and contract price. A careful allocation of responsibilities and risks relative to money, as mentioned earlier, helps reduce this problem area.

Not as Promised

The technology may not be as mature as promised, not as reproducible, or not within the specifications. Careful questions early in the process help flush out potential problems. Very often you will hear "we have the best process in the world" or similar platitudes. Ask your counterpart for specific details on comparisons to state-of-the-art world technology. Do not merely rely on his assertions.


Published: December 1994; WTEC Hyper-Librarian