How to draw up an MSA Service Agreement: Step-by-Step Guide to Drafting One

Elena Mashina

Contents:

Characteristics of the MSA

The Master Service Agreement is a service agreement used to regulate customer relationships. This agreement is especially popular in the IT field. And the best way to settle customer-client relationship is to conclude such an agreement.

MSA can help you shorten your workflow. The rest of the agreement is set out after the signing of the MSA in its annex: the parties establish a work plan in the working specification, define the characteristics of each stage of interaction, indicate the cost of labor and the procedure for transferring software.

MSA can not only fight paperwork and the proliferation of such contracts, but also has the following benefits:

Reduces the time it takes to sign a contract. After you have developed a working MSA, you can sign it with other clients, and in its attachment to you can already specify the characteristics. To save more time, you can place the MSA on the website in the form of a public offer and sign the application individually for the client.

No pitfalls. As a result, with MSA, each party is least likely to face risks and have more time.

Preamble

MSA, like any other, begins with an introduction - a preamble. This part of the agreement contains information about the parties (names, details). If a contract is concluded by a representative of any party, it is necessary to register his personally identifiable data, and on the basis of which he acts.

Also, in the preamble, the basic concepts used in the agreement may be spelled out, since a clear definition of the terms used will allow in the future to get rid of possible misunderstandings between the parties.

General terms

In the part with general conditions, the following points are disclosed:

The subject of the contract is an extremely important clause of the contract. The subject of the contract is those services that the contractor undertakes to provide to the customer. The subject of the contract must be clearly defined by the parties;
Technical task;
The procedure for amending the contract and terms of reference;
Methods for fixing the work done.

Rights to RIA

In the IT field, the MSA implies the creation of the results of intellectual creative activity. The results of intellectual creative activity are protected by copyright.

The most important element of the agreement is the clauses on the transfer of intellectual property rights. There can be two ways of such a transition:

Transfer of rights to RIA from the moment of creation of objects;
Transfer of rights to RIA from the moment of payment for the work.
In addition, you must specify:
What falls under the RIA;
To whom the rights are transferred, what rights are transferred and for how long;
What is transferred to the customer (data, materials);
What belongs to the performer.

Dispute Resolution Procedure and Applicable Law

In a contractual relationship, disputes may arise between the parties. For their effective resolution, the contract must contain the procedure for resolving disputes and the possible applicable law.

As a rule, the bona fide parties strive to solve the arising problems through negotiations, but it is not always possible to come to any consensus in this way.

The agreement may contain the rules for resolving disputes - mediation, going to court, and so on. In addition, it is possible to indicate the specific jurisdiction and the law applicable in the resolution of disputes. Such a clause may arise if the parties to the agreement are representatives of different countries and it is necessary to choose the most suitable law for both parties.

Terms and conditions of payment for the services

An important part of the contract is the clause containing the conditions and procedure for payment. Having settled the subject and terms of reference, it is necessary to prescribe the methods of paying remuneration for the work done.

Terms and conditions of payment may contain the following points:

The order of acceptance of the services performed by the customer;
Who pays taxes and other commissions and how;
Payment methods - cash, money transfer;
Payment procedure - payment is made in installments, immediately in full or in full after acceptance of the work.

Confidentiality

In the case of the development of any software or other product, it is extremely important to keep the received data safe, therefore, it is worth prescribing the types of confidential information in the contract, which is the disclosure of information and the proper way of transferring confidential information.

Responsibility

Any agreement must contain penalties and other sanctions for violation of the agreement, since their absence will lead to unpunished violation of its terms.

Thus, it is necessary to register:

Types of responsibility;
Who is responsible;
Reimbursement methods;
When liability arises.

Other terms of the contract

Other conditions of the agreement may be provisions on:

Methods of communication and notification of the parties;
Methods and periods for checking the work performed under the contract;
The ability to further support and service the product.

Thus, drafting an MSA is the right business and legal decision, since the correct contractual regulation of the relationship will allow you to get rid of possible consequences in the future. If you need help drafting your MSA, you can contact A4 Law Firm lawyers who will provide you with professional assistance and support.