What do you mean by terms of use?
Terms of Use are the guidelines and rules set by a website or service provider that users must agree to follow in order to use the service. These terms outline specific aspects like acceptable behavior, disclaimers, or limitations of liability, ensuring users understand their rights and responsibilities while using the website or service.
In practice, you can outline rules regarding the use of your content, the suspension of online accounts, or the age limit for purchasing your products.
You may have heard about Terms of Use under other names like “Terms and Conditions”, “Terms of Service” or “End User License Agreement” (EULA).
Are terms of use a contract?
Yes, Terms of Use are a contract between you, the provider of a service, and your users. When users agree to the terms, typically when using the website, buying your products or clicking an “Accept” button, they enter into a contractual agreement with you. This contract binds the user to the terms specified, and violations can lead to termination of service or legal consequences.
This contract is formed within applicable law. Some specific requirements are set by consumer laws of different regions in the world, and you should comply with them. As an example, under EU consumer law, consumers have an unconditional right to withdraw (called “cooling-off period”) of 14 days.
Is terms of use necessary?
A Terms of Use Agreement is not a legal necessity, unlike the privacy policy, which is often mandated by law. However, its importance cannot be overstated.
Terms of Use serve as a protective shield for you and your company:
- They establish legal safeguards for the provider and set clear expectations for users.
- They help handle potential problems arising or mitigate risks by preventing issues in the first place.
- Without them, it might be challenging for your business to defend itself effectively in legal disputes concerning your products or services.
For these reasons, Terms of Use are considered standard practice and remain an essential document for every business, from individual blog owners to large-scale e-commerce companies.
Where do you put terms of use?
You generally put a Terms of Use Agreement on your website, usually in a clearly accessible area. They are often linked at the bottom of the homepage or in the website’s footer. The latter is the recommended practice, since it ensures the document is easy to find and always visible from any page of the site in case users need to refer to it.
You can also find the document linked in a menu (that’s usually the case for mobile apps, under sections like “About” or “Legal”), or in the account creation/checkout forms.
What is terms of use vs terms and conditions?
Terms of Use vs. Terms and Conditions are basically the same thing and refer to the same document. They are used interchangeably, along with other names used to define this type of agreement, like “Terms of Service” or “User Agreement”. They can be used in different contexts but serve the same purpose.
Is privacy policy and terms of use the same?
A Terms of Use Agreement and a Privacy Policy have very different purposes. Terms of Use outline the rules and conditions for using your website or service, whereas the Privacy Policy describes how personal data is collected, used, and stored. Both are typically linked in the footer of a website, but they refer to unrelated matters.
Also, unlike Terms of Use, a Privacy Policy is a legal requirement under many data privacy laws like the EU’s General Data Protection Regulation (GDPR).
📌 What to Include in Your Terms of Use Agreement
Introduction and Effective Date
This section should succinctly introduce the purpose of the terms, providing a clear overview of what the document entails. This includes specifying what the terms apply to, as well as the effective date of the document.
The introduction might also give a brief insight into the nature of the company or service provider.
Acceptance of Terms
Here, you should emphasize that by accessing or using the service or product, users are agreeing to the terms outlined in the document. This section forms a contractual basis between the user and the service provider.
It often includes a statement that if the user does not agree to these terms, they should refrain from using the service. This part may also mention the legal implications of agreeing to the terms and might advise users to read the document thoroughly before consenting.
Reference to Other Policies
Here, you should reference to other legal agreements and policies that your company has. For example, your Privacy and Cookie Policy, directing users to review how their personal data is managed.
Accounts: Registration, Termination, Security
Explain the process and requirements for users to create and maintain an account with the service. It should include guidelines on choosing secure passwords, maintaining account confidentiality, and updating account information.
Additionally, this part addresses the circumstances under which a user’s account may be suspended or deleted, such as violation of terms, fraudulent activity, or extended inactivity. The section can also explain the process of account termination, both voluntary (by the user) and involuntary (by the service provider).
Intellectual Property Rights
This segment clarifies the ownership and use rights of all content and intellectual property (trademarks, copyrighted material) associated with the service or product. It can state that you retain all rights to their content, including text, graphics, logos, and software, with phrases like “All Rights Reserved.”
User-Generated Content
In this part you should outline the guidelines and rules for any content that users create, upload, or share on the platform. You should detail what is considered acceptable content and what is prohibited (e.g., offensive, illegal content in comments). You might also reserve the right to remove or modify user content that violates these guidelines.
The section may also include stipulations about how the service can use or redistribute user-generated content.
Acceptable Use and User Restrictions
Here, it’s important to specify acceptable and unacceptable behaviors and activities on the service and website. It includes rules against misconduct such as scraping data from the service, unauthorized copying and pasting of content, and other forms of misuse.
The document should clearly articulate the consequences of such misconduct, which could range from warning to legal action.
Purchasing and Billing
This section should detail the pricing structure, including any taxes or additional fees. It should clearly state any available offers or discounts, and the conditions under which they apply. It must outline accepted methods of payment, and any security measures in place to protect financial information. It should also address billing errors, and the process for disputing charges.
Delivery and Shipping
This part should specify the expected timeframe for delivery and any shipping costs. It should include any terms related to the condition of goods upon delivery, for example the “as is” clause, which indicates that items are accepted by the user in their current state without warranty. It must also outline the carrier’s responsibilities and any limitations of liability for delayed or damaged goods.
Cancellation and Return
This section must clearly define the procedure for returning a product, including time limits and condition requirements. It should specify who bears the cost of returns and the method of refund or credit. The process for canceling orders should be detailed, including any applicable time frame and charges or penalties for cancellation.
User Rights
Here you should articulate the rights of the user, particularly the right of withdrawal, which allows them to cancel a service or return a product within a specific period. It must be compliant with applicable consumer laws, detailing the process for exercising these rights.
Disclaimers of Warranties
This section should specify the guarantees or exclusions of implied warranties provided, particularly regarding conformity with advertised features, quality standards, and functionality. It can disclaim certain warranties, indicating that the service or product is provided “as is” and without warranties regarding its performance, reliability, or suitability for a particular purpose.
It must detail the remedies like indemnification or compensation against claims, damages, losses, liabilities, or expenses arising from the user’s misuse of the service or violation of the terms.
Limitations of Liability
In this crucial section, you should explain the limits to your liability in cases of issues like damages or losses incurred by the user in connection with the service. It typically includes limitations on the type of recoverable damages and may cap the amount of compensation.
Dispute Resolution
Here, detail the specific process for resolving disputes between the user and your company. It may include mandatory arbitration clauses, specify the applicable law, and identify the jurisdiction under which disputes will be settled. Online, you can use the Online Dispute Resolution (ODR) platform provided by the European Commisson.
Changes to the Terms
Describe the procedure for modifying these terms, including how changes will be communicated to users, and whether users have the option to terminate their agreement if they do not accept the new terms.
Contact Information
Provides your main contact details, including physical address, email, and phone number. It helps users to make inquiries, lodge complaints, or seek support.