depends on the context.
ref: Jurlex

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Note added at 2003-10-16 11:28:21 (GMT)
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This will help you decide if master contract is the right solution for your context.
SAP definition of master contracts:

Master Contracts

Definition

The master contract is a document under which you can group contracts as lower level contracts. It contains the general terms which apply for all the lower level contracts over a specified period.

Use

You group contracts as lower level contracts under a master contract to ensure that

* The terms in the master contract are granted in all the lower level contracts

* The data in all lower level contracts remains consistent

You can group the following documents under a master contract:

* Quantity contracts

* Value contracts

* Service contracts

The link between the master and lower level contracts is controlled by the referencing procedure which is assigned to the master contract type in Customizing. The referencing procedure determines which data is copied from the master contract into the lower level contracts

Structure

A master contract contains header data only. In the master contract, you can record:

* Business data

* Partner data

* Contract data

* Billing plan data

On the overview screen of the master contract, there is a list of all the lower level contracts which refer to it. You can branch from this list into the individual contracts.
help.sap.com/saphelp_45b/helpdata/en/dd/55fd0d545a11d1a7020000e829fd11/ content.htm - 3k


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Note added at 2003-10-16 11:37:01 (GMT) Post-grading
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SAP seems to call it a framework agreement an Outline Agreement:

Outline agreement

An outline agreement is a framework document for a long-term arrangement with a vendor to supply defined materials and/ or services subject to specified conditions. The agreement is not a formal commitment to purchase or commit expenditure. Purchase orders raised with reference to the outline agreement (known as offtake orders) are the legal commitment to expenditure.
http://www.adm.monash.edu.au/ias/SAP/Help/glossary/ias_proje...


An (EU) defintion of a framwork agreement.

What is a Framework Agreement?
2. The current Utilities Directive, and the proposed consolidated public sector Directive, both define a framework agreement as an agreement with suppliers, the purpose of which is to establish the terms governing contracts to be awarded during a
given period, in particular with regard to price and quantity. In other words, a framework agreement is a general term for agreements with suppliers which set out terms and conditions under which specific purchases (call-offs) can be made throughout the term of the agreement. The framework agreement may, itself, be a
contract to which the EC procurement rules apply. This would be the case where the
Page 2
agreement places an obligation, in writing, to purchase goods, works or services for pecuniary interest (or consideration in UK legal terminology). For this type of agreement, there is no particular problem under the EC rules, as it can be treated in the same way as any other contract.
www.bipcontracts.com/html/dir_PDF/ frameworkagreementogcrelease21.pdf