Terms of Service: Everything You Should Know (2024)

A terms of service set rules that users must agree to in order to use your website, application, or software program. While there are no laws requiring websites to implement a terms of service agreement, having one in place is recommended.

There are several different names for a terms of service agreement:

• Terms of Use
• Terms and Conditions
• Website Terms and Conditions

What are Terms of Service?

Terms of service, often abbreviated as ToS, are legal agreements between service providers and their clients or users. Terms of service are typically published on a company’s website for user to review and agree to before using the service.

ToS agreements can include various elements, including:

• Accountability provisions
• Liability provisions
• Opt-Out provisions
• Privacy policies
• Acceptable usage
• User rights and responsibilities
• Payment details for memberships, subscription fees, and the like.

In short, a ToS is simply a contract where the owner clarifies the conditions that a user must meet to use its service. Some examples include:

• Copyright and the use of content
• Rules users must follow when interacting with other users
• Cancellation of user accounts

Reasons to Use Terms of Service

There are currently no laws in place that require websites or companies to use a terms of service agreement. However, a ToS is helpful to set expectations for your users and prevent abuse. The agreement outlines what the users can expect while using your website or product and how users must behave.

While websites are not required to have a ToS, they are required to have a privacy policy. Privacy policies protect users' sensitive data:

• Email addresses
• Names
• Billing Information
• Shipping Addresses

Copyright Infringement

Your ToS agreement informs users that you own the site and its content. Any unauthorized use constitutes copyright infringement. You own everything on your site, and the ToS helps preserve ownership of your content.

Owned content can include:

• Content such as blogs and photos
• logo
• website design

Clauses connected to content ownership are called Intellectual Property clauses.

Abusive Users

Additionally, having a Terms of Service agreement in place gives you the right to terminate user accounts should they violate the agreement. These clauses make it clear that users can have their accounts canceled and even permanently banned if they abuse the website.

Governing Law

The terms of service agreement establishes "Governing Law." The Governing Law clause determines the jurisdiction and state laws that oversee, enforce, and interpret the contract.

For example, if your company is based out of Los Angeles, you would include a statement in the ToS indicating that California laws govern the agreement. Additionally, the ToS operates under US federal law. If you were to move jurisdictions, this section would need to be updated.

Here is an article about why you need a Terms of Service agreement.

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What Should Terms of Service Include?

A terms of service is extensive and has various parts, but you will want to include:

• A clear definition of your company and properties
• Links to separate documents detailing your policies, such as privacy, security, and return policies
• Disambiguation or definition of keywords and phrases
• User rights and responsibilities
• A statement regarding age restrictions to comply with the Children's Online Privacy Protection Act of 1998 (COPPA)
• A list of the responsibilities community members must follow regarding commenting on your blog posts or communicating with other users
• An outline of the illegal behavior that can get an account removed or banned
• Detail inappropriate behavior, including spamming, posting p*rnographic materials, or linking to such.
• A statement about applicable fees and their related services
• Intellectual property clauses about who owns what contents
• An ambiguous "change" clause states that you reserve the right to modify or change any part of the agreement.
• Termination clause about banning someone

Should Reading the Terms of Service Be Made Mandatory?

Do people even take the time to read a terms of service? If there is ever a dispute, making it mandatory for new members to opt-in to your ToS is the safest route. The best method is to use a clickwrap agreement.

Should You Use a Terms of Service Template?

Terms of service appear simple. However, they are meant to meet highly complex and specific scenarios and are legally binding contracts.

Each terms of service agreement protects the owner and user, so it must match your:

• Business model
• Business processes
• Applicable jurisdiction

Downloading a free template online will not accomplish these goals. It is recommended to work with a technology lawyer to help you draft your terms of service.

Who Needs Terms of Service?

Anyone building a website for their business should include a terms of service agreement on their website. Even if you are a small business, a ToS can save you many headaches later.

In some cases, you may enlist a lawyer to help you. Lawyers can:

• create your ToS document for you
• simply review the one you already created

Small businesses should consider getting a lawyer to create their ToS if:

• they are involved in e-commerce
• gather user's personal data
• marketing their intellectual property online
• talking to an audience under 13 years

Here is an article aboutterms of service and who needs it.

Are Terms of Services a Contract?

Terms of service are terms that a user must accept before using or purchasing a site's service, whether that is:

• Purchase of goods
• Access to an application
• Access to membership or registration-based site

When the user accepts the term by either checking a box, hitting a button or digitally signing, the ToS becomes a legally binding contract.

If you update your terms, you must notify customers, users, or consumers. They have no way of knowing if your ToS have been updated on their own, so they cannot agree to the new terms.

It is recommended that you do not include clauses that allow you to change the terms without prior notice. Otherwise, users are accountable to all future contacts that do not even exist yet. Including this clause may make your ToS unenforceable.

Examples of Terms of Service

Creating a terms of service agreement can be intimidating. A prime example of a good Terms of Service document is Google's ToS.

At the very beginning, Google calls out how easy it is to skip reading the ToS and just accept it, but they implore you to keep reading.

What makes Google's ToS so good?

• It is relatively short compared to other ToS documents.
• It is easy to read.
• It includes a table of contents.
• Use of bold headers and bullet points.
• Minimal legal jargon.

While we are not saying you should just copy another site's ToS, you will want yours to be as good as Google's.

Get Help with a Terms of Service

Do you need help drafting your terms of service agreement? Post a project in ContractsCounsel’s marketplace to get flat fee bids from lawyers to review and compare. All lawyers are vetted by our team and peer-reviewed by our customers for you to explore before hiring.