How to Prepare Effective ‘Terms of Service’ for Your Website

If you have a website that involves client interaction to download a product, buy goods or services, communicate with other users, play a game, etc., then your homepage should include a link to your site’s Terms of Service (sometimes called Terms of Use). This is contractual language that legally protects your company by notifying users about the dos and don’ts of how they can utilize the site. One of the most effective ways to increase the chances of your business’ ultimate success is to protect yourself legally from the outset.

The following is a general discussion of Terms of Service for any company that has an interactive web presence. However, depending on the nature of your business, you might need to add language that covers additional concerns or market realities.

Begin by reviewing the Terms of Service featured on websites of either direct competitors or other companies in your same market space. Get a general feel for the legal concerns that their Terms of Service address and how they protect their company from those concerns. If you find language that would be useful and applicable to your website, then contact your legal counsel before duplicating any of that verbiage.

The primary intent of the Terms of Service is to create a legally-binding contract between the user and your company. From the outset, your Terms of Service must make it very clear to the reader that by interacting with the website or utilizing your company’s goods or services, the user is automatically agreeing to be subject to the Terms of Service in their entirety without modification. You can further confirm your users’ assent by having them either check a box or press a button, acknowledging that they accept the Terms of Service before they’re able to continue using your site.

Your Terms of Service should warn the user of forbidden activities. It is common in Terms of Service to prohibit users from:

Using the site for any illegal purpose
Using the website or your company’s services to transmit content that could be deemed unlawful, libelous, indecent, pornographic, threatening, abusive, vulgar, defamatory, harassing, racist, obscene or otherwise inappropriate, including any messages constituting or encouraging criminal conduct
Falsely affiliating another website with your company’s website
Exporting or using your company’s information, products or services in violation of U.S. export laws and regulations
Gaining unauthorized access to your company’s data or the data of other users
Breaching or attempting to breach your website’s security systems
Violating anyone else’s legal rights (for example, privacy rights) or any laws (for example, copyright laws) in the user’s jurisdiction
Misappropriating your company’s intellectual property
Failing to handle all the information your company provides on its website with strict confidentiality
Selling, sublicensing, assigning, transferring, copying or leasing any goods, services, information or intellectual property provided on your website
Enabling third parties to violate your Terms of Service

Any website can suffer either scheduled interruptions (for maintenance and upgrades purposes) or unintended shutdowns (for whatever reason). You should give the user notice of these possibilities and offer your company’s policy on these issues, whether it be a commitment to notify the user prior to any interruptions or to restore service within a certain period. Your Terms of Service should also include specific contact information for your company’s help desk (in case users need to report any service problems) as well as a standard notices section (so that users can contact the company for any other reasons).

The Terms of Service should specify that your company won’t be liable whatsoever for the user’s misuse of its data. Your company can also declare the right to revoke or restrict the user’s access to its website, products or services if the user violates the Terms of Service or any applicable law. The Terms of Service should also include representations from the user indicating that they are either the exclusive owner of their data or have the proper licenses or consents to use the data and that your company will not be at risk of infringing any intellectual property rights of third parties. If the user violates any of the Terms of Service or applicable laws, then they must be responsible for indemnifying your company for any losses or damages that it incurs as a result.

Because your Terms of Service effectively acts as a binding contract, you must also incorporate standard provisions that appear in most agreements. These standard clauses should state that the term of the agreement created between the user and the company begins the moment the user commences interacting with the website or uses any of its goods or services. Furthermore, any amendments to the Terms of Service should only be permitted by the mutual written consent of your company and the individual user. Lastly, your website should have a separate link to your company’s privacy policy; this is a separate section of your site that you will have to create to describe how your company utilizes and protects user data.