Negotiating Technology Contracts, Second Edition

Kit Burden; Mark O'Conor; Duncan Pithouse

Book

Negotiating Technology Contracts, Second Edition

Kit Burden, Mark O'Conor, Duncan Pithouse

Published: 2023
Pages: 250

eBook: 9781787429819

The title is written with the benefit of DLA Piper’s unparalleled view of the global market for technology sourcing and outsourcing projects, and from acting for customers and service providers in this space over many years and in many jurisdictions.

Technology underpins everything we do, and the contracts which underpin the delivery of technology-related services are important from both an economic and social perspective. Negotiating technology-related contracts can, however, be challenging: for the uninitiated or uninformed, the significance of the points under discussion may be unclear, confusing and often at odds with the outcomes one might expect in more traditional ‘bricks and mortar’-style contracts.

To avoid unnecessarily protracted negotiations, it is essential to have a clear understanding of: (i) what each part of a technology-related contract is designed to deal with; (ii) what the customer and service provider seek to protect; and (iii) what solutions or compromises are available.

This second edition provides a practical, commercial guide to negotiations without a heavy focus on ‘black letter law’, and seeks to explain the perspectives of both sides of the negotiating table on a clause-by-clause basis, clearly setting out the key points they will want to protect – and why – while also offering suggestions as to what they may be willing to concede or compromise upon. It is written with the benefit of DLA Piper’s unparalleled view of the global market for technology sourcing and outsourcing projects, and from acting for customers and service providers in this space over many years and in many jurisdictions.

Chapters cover the common negotiating ‘battlefields’, from service descriptions and service levels through to warranties, indemnities, liability provisions and termination rights. The authors also examine issues associated with particular technology-related engagements, such as those based on agile methodologies, those involving the use of AI-based solutions, or those operating within heavily regulated sectors.

This edition will be of interest to anyone involved in technology-related contracts, whether acting for the buy side or sell side, and whether working within law firms or legal departments or more general commercial functions who have a need to understand the way in which such contracts work.

Cover	Cover 1
Title page	1
Copyright information	2
Table of contents	3
Introduction	7
1. Due diligence in outsourcing arrangements	11
1. Introduction	11
2. The customer perspective	17
3. The service provider perspective	21
4. Potential solutions	25
5. Conclusion	27
2. Service provisions	29
1. Introduction	29
2. The customer perspective	30
3. The service provider perspective	34
4. Potential solutions	37
3. Compliance with laws \nand regulations	41
1. Introduction	41
2. The customer perspective	42
3. The service provider perspective	46
4. Potential compromises	49
4. Service level agreements	55
1. Introduction	55
2. Service level models	56
3. The customer perspective	58
4. The service provider perspective	63
5. Potential solutions	68
5. Use of agile methodologies	73
1. Introduction	73
2. The customer perspective	80
3. The service provider perspective	81
4. Potential solutions	81
6. Warranties	87
1. Introduction	87
2. The customer perspective	88
3. The service provider perspective	92
4. Potential compromises	97
7. Relief/excused events	103
1. Introduction	103
2. The customer perspective	105
3. The service provider perspective	107
4. Potential solutions	108
8. Intellectual property provisions	111
1. Introduction	111
2. The customer perspective	113
3. The service provider perspective	116
4. Potential solutions	118
9. Data protection liabilities	123
1. Introduction	123
2. The customer perspective	124
3. The service provider perspective	126
4. Potential solutions	128
10. Benchmarking in \noutsourcing transactions	133
1. Introduction	133
2. The customer perspective	137
3. The service provider perspective	138
4. Potential solutions	139
11. Setting limits of liability	143
1. Introduction	143
2. The customer perspective	148
3. The service provider perspective	150
4. Potential solutions	152
12. Excluded liabilities	155
1. Introduction	155
2. The customer perspective	156
3. The service provider perspective	157
4. Potential solutions	160
13. Unlimited liabilities	165
1. Introduction	165
2. The customer perspective	165
3. The service provider perspective	170
4. Potential compromises	175
14. TUPE in outsourcing agreements	181
1. Introduction	181
2. The customer perspective	186
3. The service provider perspective	189
4. Potential solutions	191
15. Termination rights	197
1. Introduction	197
2. The customer perspective	198
3. The service provider perspective	204
4. Potential solutions	206
16. Step-in provisions	211
1. Introduction	211
2. The customer perspective	212
3. The service provider perspective	215
4. Potential solutions	219
17. Audit rights	221
1. Introduction	221
2. The customer perspective	222
3. The service provider perspective	224
4. Potential solutions	227
18. Dispute resolution provisions	233
1. Introduction	233
2. The customer perspective	233
3. The service provider perspective	238
4. Potential solutions	240
19. Negotiation in practice	241
1. Background	241
2. Initial considerations	242
3. The procurement process	243
4. Key contract aspirations of the parties	246
5. Likely areas for key debate and potential solutions	249
20. Contracting for new and complex technology	255
1. Introduction	255
2. The European approach	257
3. The UK approach	259
4. The US approach	259
5. Common ground	260
6. Contractual provisions	261
7. How does AI work?	261
8. Description of functionality	262
9. Intellectual property	262
10. Bias	264
11. Explainability	265
12. Service performance	266
13. Liability	267
14. Termination	268
15. Exit	269
21. Types of technology contract	271
1. Introduction	271
2. Software licence	271
3. Software maintenance	272
4. Hardware provision	273
5. Hardware maintenance	273
6. Cloud services	274
7. Outsourced/managed service	274
8. Website/online terms	275
9. Telco/network services	275
10. IP transfers and joint ventures	275
11. Technology-related consultancy services	275
22. Cloud services	277
1. Introduction	277
2. The customer perspective	278
3. The service provider perspective	282
4. Potential solutions	284
23. Regulated procurement	289
1. Regulated procurement in the public sector	289
2. Regulated procurement in the financial services sector	296
24. Managing contract disputes	303
1. Introduction	303
2. Causes of contract disputes	303
3. Managing disputes	307
Conclusion	315
About the authors	319
Index	321
About Globe Law and Business	329

Kit Burden
Partner and International Board member, DLA Piper UK LLP
[email protected]
https://www.linkedin.com/in/kit-burden-4207391/

Kit Burden is a partner in the Technology and Sourcing Group at DLA Piper and is also a member of its International Board. He specialises in complex technology transactions and outsourcing engagements, advising both suppliers and customers. He has for many years been listed as a ‘tier 1’ technology lawyer by both Legal 500 and Chambers, as well as having been recognised by the Global Sourcing Association as both its Legal Advisor of the Year, and subsequently as its Strategic Advisor of the Year. He is a past trustee and current fellow of the Society for Computers and Law, and also chairs its special interest group on outsourcing.

Mark O’Conor
Partner, DLA Piper UK LLP
[email protected]
https://www.linkedin.com/in/markoconor/

Mark O’Conor is a partner at DLA Piper and heads its Client Group for the London office, as well as being a past managing partner of the UK firm. He started his career at Bird & Bird before moving to DLA Piper, where he has practised for the last 17 years and is now the head of the firm’s Technology Sector. He works with a diverse set of clients in both the private and public sectors, including a wide range of household name organisations. He has also had a long- standing involvement with the Society for Computers and Law (SCL), and is the current chair of the board of trustees for the SCL. He is a frequent speaker and writer on technology and legal themes and is listed in both Chambers and Legal 500 as a leading technology lawyer.

Duncan Pithouse
Partner, DLA Piper UK LLP
[email protected]
https://www.linkedin.com/in/duncan-pithouse/

Duncan Pithouse is a partner in the London office of DLA Piper, and heads the UK Technology and Sourcing Group. His focus is on technology contracts and outsourcing agreements, with a particular focus upon work in highly regulated sectors such as banking and insurance. He is a frequent contributor of articles and thought leadership on technology legal matters, and is recognised as a leading practitioner in the various legal directories. His clients include some of the world’s leading FS&I institutions and global corporates.

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Negotiating Technology Contracts, Second Edition

Table of Contents

Practical, topical titles for international legal and business professionals

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Negotiating Technology Contracts, Second Edition

Table of Contents

Practical, topical titles for international legal and business professionals