What Are Terms and Conditions?
A terms and conditions agreement outlines the website administrator’s rules regarding user behavior and provides information about the actions the website administrator can and will perform.
Essentially, your terms and conditions text is a contract between your website and its users. In the event of a legal dispute, arbitrators will look at it to determine whether each party acted within their rights.
Creating the best terms and conditions page possible will protect your business from the following:
- Abusive users: Terms and Conditions agreements allow you to establish what constitutes appropriate activity on your site or app, empowering you to remove abusive users and content that violates your guidelines.
- Intellectual property theft: Asserting your claim to the creative assets of your site in your terms and conditions will prevent ownership disputes and copyright infringement.
- Potential litigation: If a user lodges a legal complaint against your business, showing that they were presented with clear terms and conditions before they used your site will help you immensely in court.
In short, terms and conditions give you control over your site and legal enforcement if users try to take advantage of your operations.
Are You Legally Required to Have Terms and Conditions?
Technically, no. You aren’t legally required to have a terms and conditions agreement.
However, having terms and conditions for websites is considered standard business practice in the US, Canada, the UK, and just about everywhere else — from South Africa to Australia.
If you plan to grow your business or expand your user base, a simple website terms and conditions page will provide your site with an additional layer of legal protection.
Not sure which documents you need to protect your site? Find out the difference between a terms of use and a privacy policy in our guide.
Reasons to Have a Terms and Conditions
Besides giving your business more legal protection, you should also have a terms and conditions agreement on your website for the following reasons:
To Set Liabilities Limits
Almost every terms and conditions agreement has a warranty or limitations of liability disclaimer. We’ll cover it in more detail in our section about what clauses to include in your terms and conditions, but this clause essentially limits what customers can hold you liable for.
Most companies restrict liability for:
- Inaccuracies and errors
- Lack of enjoyment
- Product or website downtime
- Viruses, spyware, and product damage
To Outline Policies and Avoid Abusive Behavior
Many companies use their website’s terms and conditions to lay down the rules that users must agree to and follow before accessing your website or service.
Most of these rules revolve around how users should interact with others and what they can and can’t post or do.
To Terminate Abusive Users’ Accounts
Your terms and conditions agreement is also a great place to list when and why you can terminate the accounts of abusive users. Most companies, for instance, will ban users if they’re using the platform or site for illegal activities, bullying other users, and unauthorized web scraping.
Keep Others From Copying Your Content
Another reason for having a terms and conditions agreement is to disclose and protect your intellectual property rights.
Adding an intellectual property disclosure clause to your terms and conditions text informs users of your intellectual property rights, such as your logos, content, and other protected ideas and marks.
If you catch your users copying your content, you can take legal action against them since your terms and conditions agreement is legally binding.
To Outline Governing and Applicable Laws
Finally, you should have a terms and conditions agreement to inform users which federal or state laws — or both — govern your agreement.
If a dispute arises between you and your user, the court will use the governing law to interpret the terms and conditions agreement and its effects.
Clauses To Include in Your Terms and Conditions Agreement
Terms and Conditions agreements contain a broad range of guidelines for how you and your users can use your service or site.
Even short terms and conditions agreements should include several vital clauses to safeguard your business. Otherwise, your website’s terms and conditions agreement will be incomplete, exposing you to many legal risks.
Here’s what you should include in your terms and conditions agreements to prevent such misunderstandings and others:
Introduction
Your terms and conditions agreement should start with an introduction that lets users know they’re reading a terms and conditions agreement.
You should also mention that anyone using your service, platform, or site must follow the terms.
YouTube, for example, clearly establishes in its terms and conditions that:
- Users must agree to the terms of the agreement before using the service.
- Users must be at least 13 years old to use YouTube.
- Users under 18 must have their guardian or parents’ permission to use the service.
- Anyone who uses YouTube is automatically assumed to have agreed to its terms and conditions.
Governing and Applicable Laws
As touched upon above, you need to establish what national or state law governs the agreement between you and the users. Most companies choose the law of their state or country or the country where users access their site or app.
Most governing law clauses are short and straightforward. Spotify, for instance, consists of only four lines.
