Software and service agreements

Technology agreements allocate risks that are unfamiliar to parties used to goods contracts.

Licence or service. A perpetual licence conveys rights in software; a subscription grants access to a service. The distinction affects what the customer retains on termination, which is usually nothing in a service model.

Scope. Permitted users, affiliates, contractors, geographies, environments and volume metrics. Ambiguity here is the most common source of audit disputes.

Service levels. Availability commitments with a measurement methodology, exclusions for maintenance windows, and service credits. Credits are typically the exclusive remedy short of a chronic-failure termination right, which customers should insist on.

Data. Ownership of customer data stated expressly; permitted uses including whether aggregated and de-identified data may be used; security obligations tied to a recognised framework; breach notification timing; and return or deletion on termination in a usable format, with a defined transition period.

Privacy. A data processing addendum where personal data is involved, with subprocessor controls and transfer mechanisms.

Intellectual property indemnity for third-party infringement claims, with the customary remedies of procuring rights, modifying, or refunding.

Limitation of liability with carve-outs for data breach and confidentiality, since a general cap tied to fees is meaningless against a security incident.