Definition
An offset agreement is an agreement between two parties whereby a supplier agrees to buy products from the party to whom it is selling, in order to win the buyer as a customer and offset the buyer's outlay. Generally the seller is a foreign company and the buyer is a government that stipulates that the seller must then agree to buy products from companies within their country. Often, the aim of this process is to even-up a country's balance of trade. This is frequently an integral part of international defense contracts.
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