To understand how to write a terms of service agreement, which has many sections, including definitions, the user's rights and responsibilities, and disclaimers, it is important to know that the agreement performs two main and essential functions:

  1. It educates the customers about the rules put in place prior to using a product or service.
  2. It protects your company from legal action.

A TOS, or Terms of Service, is a legally binding agreement that a user must agree to before engaging in services or using a product. It might also list any stipulations, rules, or rights in relation to using a product, such as a website.

Terms of service are most often used on the following platforms:

  • Websites
  • Mobile Apps
  • E-commerce Marketplaces
  • Facebook Apps
  • E-commerce Mobile Apps
  • Desktop Apps
  • SaaS Apps

Steps to Write a Terms of Agreement

Terms of agreements should include the following four components:

  1. Language - Offer definitions and terms that will be used throughout the agreement. The first paragraph should always be the acceptance of terms clause. This confirms the users understand that to use your product or service, they are agreeing to the rules of the agreement. This should be in bold, uppercase, and large font size.
  2. Rules, Rights, and Responsibilities of the User - Outline the user's rights and responsibilities in a direct and concise format. If applicable, include what is not allowed.
  3. Liabilities and Company Fault - Limit the company's liability in a clear manner. You might also include any return policies and disclaimers if working as a retail business.
  4. Verification - The end of the agreement must include a section that asks the user to agree to all terms. A paper TOS should include a location to sign and date as proof of acceptance. A web-based agreement should have an "I Agree" button.

The terms of service agreement might also include:

  • A privacy statement
  • Intellectual property rights provision
  • Advertiser relationships
  • Payment policies
  • Delivery of goods
  • Termination clauses
  • Notification provisions

These should be modified to your specific rules and regulations.

When writing the terms of service, you should never copy and paste from other terms of service agreements. They might contain legalese that is not relevant to your company or product. Typically, templates available online will work, as they provide legalese that will allow you to cover all important topics and concerns.

The terms of service should be specific to your protected content, including the type of products and services. This also includes specifying items such as logos. It might be clear that a customer cannot copy and paste an article due to copyright, but it might not be clear that the logo is also included under the same copyright protection.

Advantages of Creating Terms and Conditions

Terms and conditions list any rules and guidelines that a user agrees to before using your company website or mobile application. Terms and conditions help protect your business and avoid the risk of uncertainty or misunderstanding of the user. Advantages of the terms and conditions include:

  • Preventing abuses by creating a legally binding list of guidelines and repercussions if not followed.
  • Conveying what content you own to protect it from misuse or theft.
  • Preventing liability issues by alerting customers that you are not responsible for errors that might appear in the document.

Terms and conditions are not required legally but are recommended as a way to protect your rights and investment and prevent abuse by users that don't follow what has been stipulated. They should include:

  • Contact Information
  • Contribution Clause
  • Dispute Resolution Clause
  • DMCA Notice
  • Future Changes Clause
  • Governing Law
  • Intellectual Property Disclosure
  • Limitations Clause

Terms and conditions should be easily accessible. In many cases, they are placed in a position that requires the user to read and accept them before using the product. In this scenario, the terms should be clear, concise, and easy to use.

Terms of service agreements should be one of the first documents presented to customers to establish the nature of the relationship.

If you need help understanding how to write terms of service agreement, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.