Offtake Agreement (also referred to in German as Abnahmevereinbarung)

A contract under which an obligation to pay arises even if the agreed delivery does not (yet) take place (an agreement between a producer of a resource and a buyer of a resource to purchase portions of the producer’s future production). Such agreements are often used in natural resource development, where the capital costs to extract the resource is considerable and the company wishes a guarantee that some of its product will be sold. – Such obligations entail a very high risk, because in practice the buyer also participates in the failure of an investment. The accounting rules therefore require special recognition of these risks.

Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent!
University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/