Custom Software Development Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Custom Software Development Agreement

"I need a Custom Software Development Agreement for a Saudi-based healthcare company engaging a local developer to create a patient management system, with strict data protection requirements and completion deadline of March 2025."

Document background
The Custom Software Development Agreement is essential for organizations in Saudi Arabia seeking to engage professional software developers or development companies for creating bespoke software solutions. This document becomes necessary when a client requires specialized software tailored to their specific business needs, rather than off-the-shelf solutions. The agreement must comply with Saudi Arabian laws, including the Electronic Transactions Law, Copyright Law, and data protection regulations, while adhering to Sharia principles. It typically covers project specifications, development methodology, intellectual property rights, payment structures, and acceptance criteria. The document is particularly important in the context of Saudi Arabia's Vision 2030, which emphasizes digital transformation and technological advancement across various sectors.
Suggested Sections

1. Parties: Identification of the contracting parties including full legal names, commercial registration numbers, and authorized representatives

2. Background: Context of the agreement and brief description of the parties' business relationship and project objectives

3. Definitions: Detailed definitions of technical terms, project-specific terminology, and key concepts used throughout the agreement

4. Scope of Services: Detailed description of the software development services, including development methodology and project phases

5. Project Timeline and Milestones: Specific deadlines, development phases, and delivery schedule for the software

6. Development Process: Description of the development methodology, approval processes, and communication protocols

7. Acceptance Testing: Procedures for testing deliverables, acceptance criteria, and handling of defects

8. Payment Terms: Detailed payment schedule, amounts, and payment conditions aligned with project milestones

9. Intellectual Property Rights: Ownership and licensing of pre-existing IP and newly developed software, including source code

10. Confidentiality: Protection of confidential information and trade secrets of both parties

11. Warranties and Representations: Warranties regarding software performance, compliance with specifications, and non-infringement

12. Term and Termination: Duration of the agreement and circumstances under which it can be terminated

13. Liability and Indemnification: Limitations of liability and indemnification obligations of both parties

14. Force Majeure: Provisions for handling unforeseen circumstances preventing performance

15. Governing Law and Dispute Resolution: Specification of Saudi law as governing law and dispute resolution mechanisms

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

Optional Sections

1. Source Code Escrow: Optional provision for source code escrow arrangements, recommended for mission-critical software

2. Security Requirements: Specific security standards and compliance requirements, necessary if handling sensitive data

3. Training and Knowledge Transfer: Provisions for training client personnel, important if maintenance will be handled internally

4. Maintenance and Support: Post-development maintenance and support terms, optional if covered in a separate agreement

5. Data Protection: Specific data protection obligations, required if personal data is processed

6. Change Management: Procedures for handling change requests, recommended for complex projects

7. Service Level Agreement: Performance metrics and service levels, necessary for ongoing services

8. Third-Party Components: Terms regarding use of third-party software and components, needed if using external libraries

9. Localization Requirements: Specific requirements for Arabic language support and local cultural considerations

Suggested Schedules

1. Schedule A - Software Specifications: Detailed technical specifications of the software, including functionality and features

2. Schedule B - Project Plan: Detailed project timeline, milestones, and deliverables

3. Schedule C - Acceptance Test Criteria: Specific criteria and procedures for accepting deliverables

4. Schedule D - Payment Schedule: Detailed breakdown of payments linked to milestones

5. Schedule E - Service Level Requirements: Performance metrics and service level specifications

6. Schedule F - Technical Environment: Description of development and deployment environment specifications

7. Schedule G - Personnel: Key personnel assigned to the project and their roles

8. Appendix 1 - Change Request Form: Standard form for requesting and documenting changes

9. Appendix 2 - Testing and Acceptance Forms: Standard forms for documenting testing and acceptance procedures

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

Relevant legal definitions
Clauses
Relevant Industries

Information Technology

Banking and Finance

Healthcare

Education

Government Services

Retail

Manufacturing

Telecommunications

Oil and Gas

Construction

Professional Services

E-commerce

Transportation and Logistics

Insurance

Real Estate

Relevant Teams

Legal

Information Technology

Procurement

Operations

Software Development

Project Management

Information Security

Compliance

Finance

Risk Management

Technical Architecture

Quality Assurance

Business Analysis

Vendor Management

Digital Transformation

Relevant Roles

Chief Technology Officer

IT Director

Project Manager

Legal Counsel

Procurement Manager

Software Development Manager

Contract Manager

Chief Information Officer

Business Development Manager

Technical Project Lead

Solution Architect

Information Security Officer

Compliance Officer

Operations Manager

Digital Transformation Manager

Industries
Electronic Transactions Law (Royal Decree No. M/18): Governs electronic transactions and signatures, providing legal recognition to electronic contracts and digital signatures, which is crucial for software development agreements
Copyright Law (Royal Decree No. M/41): Protects intellectual property rights in software, source code, and related documentation, establishing ownership and usage rights
Cloud Computing Regulatory Framework: Regulates cloud computing services and data storage, relevant if the software involves cloud components or data storage
Personal Data Protection Law (PDPL): Regulates the collection, processing, and storage of personal data, crucial if the software handles user data
Commercial Law (Royal Decree No. M/32): Provides the basic framework for commercial contracts and business transactions in Saudi Arabia
Anti-Cyber Crime Law (Royal Decree No. M/17): Addresses cybersecurity requirements and penalties for cyber crimes, relevant for software security obligations
Competition Law (Royal Decree No. M/75): Regulates competitive practices and may affect non-compete clauses and market restrictions in software agreements
Value Added Tax (VAT) Law: Governs taxation aspects of software development services and licensing
Labor Law (Royal Decree No. M/51): Relevant for provisions related to employment of developers and project staff if local hiring is involved
Government Tenders and Procurement Law: Applicable if the software development agreement involves government entities as clients
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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