das Abkommen
agreement
A formal contract or agreement between two or more parties, such as states, organizations, or companies.
Die beiden Länder unterzeichneten ein Handelsabkommen.
The two countries signed a trade agreement.

agreement
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agreement
A formal contract or agreement between two or more parties, such as states, organizations, or companies.
Die beiden Länder unterzeichneten ein Handelsabkommen.
The two countries signed a trade agreement.

'Das Abkommen' (the agreement/deviation) is the nominalization of the verb 'abkommen'. This verb can mean both 'to reach an agreement' and 'to deviate from a path', which explains the two meanings of the noun.
Die Gewerkschaft hat mit dem Arbeitgeber ein neues Abkommen getroffen.
The union reached a new agreement with the employer.
In the context of contracts, an agreement is often 'geschlossen' (concluded), 'unterzeichnet' (signed), 'ausgehandelt' (negotiated), or 'ratifiziert' (ratified). You can also 'brechen' (break) or 'kündigen' (terminate) it.
Die beiden Staaten haben ein Friedensabkommen ausgehandelt.
The two states negotiated a peace agreement.
To name the partners and the topic of an agreement, fixed prepositions are used: an agreement 'zwischen' (between) the parties, 'mit' (with) a partner, and 'über' (about/on) the topic (accusative).
Es gab ein Abkommen zwischen den Firmen über die gemeinsame Forschung.
There was an agreement between the companies on the joint research.
The meaning 'Abweichung' (deviation) is very rare today and is used almost only in elevated or older language. It practically does not occur in modern everyday speech.
Sein Verhalten wurde als ein Abkommen von den guten Sitten betrachtet.
His behavior was regarded as a deviation from good morals.
contract
'der Vertrag' and 'das Abkommen' are both formal agreements. 'der Vertrag' is used very often in everyday life, for work, rent, mobile phone plans, purchases, or services. It is usually written and legally important. 'das Abkommen' sounds more official and is especially suitable for states, organizations, or large companies. Learners may confuse the words because both mean a fixed agreement. As a simple guide: between individual people or companies, you often say 'Vertrag'; between states or large groups, 'Abkommen' is more likely.

Das Abkommen zwischen den beiden Ländern gilt ab nächstem Jahr.
The agreement between the two countries takes effect next year.
Die Kundin unterschreibt den Vertrag, bevor sie das neue Auto bekommt.
The customer signs the contract before she gets the new car.