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Knowledge agreements
Selling knowledge abroad is an increasing trend. An obvious attraction is 
that the actual investment in the foreign operation can be relatively small, 
although there is a risk that the knowledge can be used in a competitive 
product or system unless stringent legal safeguards covering copyright, pat-
ents and trademarks are enforced. Another area that may cause problems is 
the need to ensure consistent quality control. In certain cases, the provider 
may be involved in an ongoing consultancy capacity.
Turnkey arrangements
A turnkey arrangement is a contract under which one company agrees to 
design, build and install the necessary equipment for a new plant and then 
hand the plant over to the purchaser to manage completely when it is up 
and running. The arrangements can often include the continued training 
of staff after the facility is fully operational. Such projects can comprise, 
for example, nuclear power plants, airports, oil refineries and major infra-
structure projects as well as defence sales, such as BAE Systems’ contract for 
the provision of arms for Saudi Arabia. An example of a large construction 
company involved in a turnkey project is the US engineering giant Bechtel, 
which completed the new Hong Kong International Airport in 1998.
The contracts may require expertise in hiring and motivating local 
workers and can be in remote areas, with the resultant requirement for 
accommodation, appropriate infrastructure and a number of expatriate 
workers. There is also a need for detailed contracts to cover when the project 
is to be completed to the required handover standard, how long the train-
ing will continue after the handover date and when final payment is to be 
made. There is also the risk that a supplier may be awarded the project by 
the receiving government for mainly political reasons, such as to enhance 
the reputation and prestige of that government and not for the technology 
advantages for the local community.