Service Provider Agreement for India

Service Provider Agreement Template for India

A Service Provider Agreement under Indian law is a comprehensive legal contract that establishes and governs the relationship between a service provider and a client. This document outlines the scope of services, delivery terms, payment conditions, and mutual obligations of the parties involved. It incorporates key provisions required under Indian contract law and relevant sector-specific regulations, while addressing critical aspects such as intellectual property rights, confidentiality, liability limitations, and dispute resolution mechanisms. The agreement ensures compliance with Indian legal requirements including the Indian Contract Act, 1872, and other applicable legislation, while providing a clear framework for service delivery and business relationship management.

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What is a Service Provider Agreement?

The Service Provider Agreement is a fundamental commercial contract used when one party (the service provider) agrees to provide professional services to another party (the client) under Indian law. This agreement is essential for businesses outsourcing services or engaging external expertise, ensuring clear definition of services, deliverables, and performance standards. It protects both parties' interests by establishing detailed terms for service delivery, payment, intellectual property rights, and confidentiality. The document complies with Indian legal requirements, including the Indian Contract Act, 1872, and incorporates necessary provisions for dispute resolution and liability management. It's particularly crucial in today's business environment where service-based relationships form a significant portion of business operations, requiring careful attention to service levels, compliance requirements, and risk allocation.

What sections should be included in a Service Provider Agreement?

1. Parties: Identification and details of the service provider and service recipient, including registered addresses and company registration numbers

2. Background: Context of the agreement, brief description of the parties' business and purpose of entering into the agreement

3. Definitions: Detailed definitions of key terms used throughout the agreement

4. Scope of Services: Detailed description of services to be provided, including deliverables and service standards

5. Term and Termination: Duration of the agreement, renewal terms, and circumstances for termination

6. Payment Terms: Fee structure, payment schedule, invoicing process, and payment methods

7. Obligations of Service Provider: Key responsibilities, service levels, quality standards, and performance metrics

8. Obligations of Client: Client's responsibilities, including provision of information, access, and cooperation

9. Confidentiality: Protection of confidential information, non-disclosure obligations, and data security measures

10. Intellectual Property Rights: Ownership and usage rights of pre-existing and created IP during service provision

11. Indemnification: Mutual indemnification obligations and process for claiming indemnity

12. Limitation of Liability: Caps on liability and exclusions from liability

13. Force Majeure: Events considered force majeure and their impact on obligations

14. Dispute Resolution: Process for resolving disputes, including jurisdiction and governing law

15. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment

What sections are optional to include in a Service Provider Agreement?

1. Data Protection: Required when personal data processing is involved, detailing compliance with data protection laws

2. Compliance with Laws: Specific section needed when services are in regulated industries or require specific statutory compliance

3. Insurance: Required when services involve significant risks or when specific insurance coverage is necessary

4. Non-Compete: Optional restriction on service provider's ability to work with competitors

5. Non-Solicitation: Restrictions on hiring each other's employees or approaching clients

6. Service Credits: Applicable when service level agreements (SLAs) are part of the contract

7. Change Control: Required for long-term or complex services where scope changes are likely

8. Transition Services: Needed when complex handover or exit management is required

9. Business Continuity: Important for critical services requiring disaster recovery and business continuity planning

10. Audit Rights: Required when regular monitoring of service provider's compliance or performance is needed

What schedules should be included in a Service Provider Agreement?

1. Schedule 1 - Service Specifications: Detailed description of services, methodologies, and delivery requirements

2. Schedule 2 - Service Levels: Specific performance metrics, measurement methods, and remedies for non-performance

3. Schedule 3 - Fee Schedule: Detailed breakdown of fees, rates, expenses, and payment terms

4. Schedule 4 - Key Personnel: List of key team members and their roles in service delivery

5. Schedule 5 - Technical Requirements: Technical specifications, systems requirements, and compatibility needs

6. Schedule 6 - Compliance Requirements: Specific regulatory or industry standards that must be met

7. Schedule 7 - Security Requirements: Information security protocols and requirements

8. Schedule 8 - Implementation Plan: Timeline and milestones for service implementation

9. Appendix A - Contact Details: Key contact persons and escalation matrix for both parties

10. Appendix B - Required Documentation: List of documents to be maintained and shared during service provision

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

India

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Information Technology

Professional Services

Consulting

Healthcare

Manufacturing

Financial Services

Real Estate

Construction

Education

Telecommunications

Logistics

Facilities Management

Marketing and Advertising

Research and Development

Human Resources Services

Relevant Teams

Legal

Procurement

Finance

Operations

Risk and Compliance

Commercial

Business Development

Project Management Office

Vendor Management

Service Delivery

Relevant Roles

Legal Counsel

Procurement Manager

Contract Manager

Business Development Manager

Operations Director

Chief Financial Officer

Project Manager

Risk Manager

Compliance Officer

Department Head

Managing Director

Chief Executive Officer

Commercial Director

Vendor Manager

Service Delivery Manager

Industries
Indian Contract Act, 1872: Fundamental law governing contract formation, validity, performance, and enforcement in India. Essential for defining basic contractual elements like offer, acceptance, consideration, and breach remedies.
Central Goods and Services Tax Act, 2017: Governs the taxation aspects of services provided within India. Critical for determining tax obligations and requirements in service agreements.
Information Technology Act, 2000: Relevant for digital services and electronic execution of agreements. Also covers aspects of data protection and cyber security requirements.
Indian Partnership Act, 1932: Important if either party is a partnership firm, governing their ability to enter into contracts and liability aspects.
Companies Act, 2013: Relevant when either party is a company, governing corporate authority to enter into contracts and compliance requirements.
Specific Relief Act, 1963: Governs remedies available in case of contract breach, particularly relevant for enforcement of specific performance clauses.
Indian Copyright Act, 1957: Important for protecting intellectual property rights in services involving creative or technical works.
Consumer Protection Act, 2019: Applicable if services are being provided to consumers, ensuring consumer rights and protection.
Arbitration and Conciliation Act, 1996: Relevant for dispute resolution mechanisms and enforcement of arbitration clauses in the agreement.
Foreign Exchange Management Act, 1999: Applicable if the service agreement involves cross-border services or payments in foreign currency.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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