Web Agreements

Hosting Agreements

Website hosting agreements provide for hosting and making a website available.  The hosting provider will need the requisite infrastructure including the necessary hardware and equipment to enable it to provide the services.

The website data is stored by the provider. The hosting arrangements may be complex. Data may be held in multiple locations.

The quality and extent of access required by the customer may not be initially apparent.   Initial capacity may be purchased with scope for later expansion.

The agreement will commonly be provided, drafted and provided by the host.   In most cases, little or no negotiation will take place

Hosting Mutual Obligations

There may be obligations in relation to their maintenance, security, insurance, data recovery.  Backup of information on a regular basis can be critical.  Security obligations and measures will be central.  There may be a service-level agreement in this regard.

The website owner should have administration/editorial access to the site at a higher level than the public.  The website owner will have editorial control over the right.   It may have rights to see particular metadata about the site’s operation.

The customer should be enabled to upload information, amend and remove it.   Generally, the host will not need to be involved.   The host will wish to ensure that it does not store information which may cause legal, civil or criminal legal liability for the host.

Hosting Services

The hosting agreement should provide minimum obligations in terms of operational speeds.   A period of service suspension may be required periodically to deal with servicing issued, including server maintenance.   Provision may be required for emergency action where necessary.

The customer may have compensation by way of service credits or other rights in the event of a breach of the obligations to provide continuous service.   It may be provided that the service credits are the sole remedy.

The customer will wish to ensure the host repairs any interruptions to the service promptly.   A service level agreement may provide times within which matters must be dealt with.   Customer may discover a matter that needs correction and the requisite service and support obligations.

A disorderly termination may have a highly disruptive effect.   The customer will want the risk of pre-emptive termination.   There should be obligations in relation to the transfer of the hosted data to a third party in the event of termination, other than for material breach

Hosting; Liability Issues

A consent or licence for displaying the data may be required in order to deal with the customer’s or third-party intellectual property rights.  The host will seek to limit its liability to third parties and may require indemnities from customers.

In some cases, a provider may be subject to liability if it does not take action, having been notified of breaches of intellectual property other rights and criminal breaches.   If the host is required by law to suspend or take down the service, it may be required to do so, immediately.

There may be some cases where there is serious criminal breach where it is entitled to immediately terminate without notice.   In other cases, it may be necessary to investigate a complaint.   Suspension may or may not be appropriate in the meantime.

Website Linking Agreements

A website owner may charge for the placement of links on its website to e-commerce sites selling products or services.   The link may be both an advertisement and a channel through which customers connect directly and enter a transaction with the business concerned.  Website linking agreements provide for the placement of the link/advertisement to the target website. The agreements tend to be relatively short-term, subject to the possibility of renewal.

Linking agreements may be entered where there is formal cooperation on branding or content sharing or there are other commercial arrangements between the parties. It may provide for the sharing of intellectual property and branded material. The target website may wish to have exclusivity so as to preclude links to competing websites.   Exceptionally, regard must be had to common law and competition law considerations in this context.

The agreement should describe its purpose.  The commercial terms will be negotiated in the context of the product or service market There may be mutual benefit.   In other cases, the link may be for the exclusive benefit of the target website and involve payment of a fee in return.

Agreements may provide for performance service levels.   They may be specified in terms of key performance matters and criteria in relation to the quality of performance.

Content and Location Issues

The agreement should define the content and quality of the advertisement/placement on the principal website.   It may define the content and placement of any logos, banners, trademarks.   A pictorial example may be appended. Dimensions etc.  may be specified. The target website owner gives the principal website owner sufficient intellectual property rights and consents to permit the display of the link to the target businesses.

It may be provided that the link will appear at a certain point on the screen or at a certain layer in the navigation in of the principal website.  It may be specified that it is to appear when the website first appears on the user’s screen (on certain device types) as opposed to when scrolled down (below the fold) under a normal view.

The principal website owner may wish to control the content of the target website in terms of standards legality and reputation.  It will have an interest in preserving the quality of the principal website and its image.   It may make requirements and place obligations in relation to doing business, trading methods, the product sold etc.

Linking; Fees and Commission

The agreement should provide for the payment of fees and/or commission.   The commission may be payable with reference to the number of click-throughs or sales achieved. Fees may be based on the number of times that the target website is requested and loaded.   Payment per click-through involves payment based on click through the relevant banner, logo, link etc

A flat fee may be placed for the link. It may be contingent on achieving a minimum number of click-throughs.  The commission may be the sole or partial basis for payment.   This necessitates tracking of references and transactions.   A provision would be required for reporting and audit.   There should be an automated mechanism for identifying and tracking visitors and sales.

Intellectual Property Issues

The owner of copyright website material who consents to content appearing on freely available pages may be deemed to have consented for copyright purposes to links from other websites which do not extend its accessibility to any further part of the public. The communication to the public should by the same means of communication.

Where there is a link on one website to another, it can in principle be a communication to the public, which is restricted under copyright law and thereby requires a licence from the rights owner. This can occur where there is a new communication rather than a communication to the same audience as the linked website.  The circumvention of a paywall would involve giving access to a new public. There may also be a copyright breach where the link embodies content from the linked to the website.

IP and other Liability Issues

The risk that there might be a breach of law and consequent legal liability must be dealt with and allocated.   There may be an indemnity by one party to the other in respect of intellectual property infringement, breach of data protection and other legal requirements.

Cases support the proposition that a website that links to unlawful material (in a civil sense) on another site may be the subject of claim or defamation, breach of data protection etc., breach of privacy as the case may be. Many jurisdictions have a statutory defence in such cases. The EU E-Commerce Directive provides defences for intermediaries. There are conditions applicable to the defence.

Significant data protection issues arise regarding the use of personal information.  The principal website may gather significant information regarding consumer preferences from browsing habits and purchases.   Their ongoing preferences may be tracked through browsing or feedback.  This may be gathered through session information.   In some cases, users may register with the website and furnish information in relation to their preferences. The parties to a linking agreement may require that the other party obtain lawful Data Protection Act consents in relation to these matters

Supply of Content

The supply of a book, music or its equivalent electronically (as opposed to in hard form) raises different considerations to the sale of a hard copy product. In the case of a tangible copy, the seller must give title to the product in return for the price. He must give unconditional title, such as to allow the customer to use it as he wishes subject to a general law.

In the case of a digital sale, more complex issues arise. The agreement may limit the use of the digital material to a particular format. The agreement will license the use of the material. The support for and availability of the material online grants a different range of rights to use and reuse of the material after the sale then applies to a hard copy book.

The retailer and distributor must be able to grant the relevant rights of access to the data. Limitations and restrictions may be required to protect against breach of privacy, data protection, and defamation breaches. Support may require and involve ongoing commitments to maintain help desks, online assistance etc.

The retailer/ E-tailer, distributor online may purchase content and sell on its own account in the same way as a conventional retailer. An alternative model involves the distributor being an agent on behalf of the content owner, selling and distributing but not taking the same markup or commercial risk. In this case, his remuneration is through a commission/fee.

Licensing of Content

Content may be licensed for use on a website.   This may encompass material which was previously or was traditionally printed and is reoriented for use on a website without being updated.   The licensing agreement should set out the scope of what is to be provided.  The rights may be granted for electronic media only.

The licence agreement should provide obligations in terms of a delivery of the content. It should identify the subject matter and content licensed.   The licensor must have the requisite rights to do so.

The nature of the what is required in relation to content will be specific to the circumstances.   It should be delivered in accordance with the requisite quality, accuracy and on time. Content provision obligations may require regular updating, for example, in relation to news, current affairs, business information.

The provider may seek to retain editorial control even after the material is delivered or published.   He may wish to preserve his integrity, quality, and reputation.

Licensing Agreement Issues

Generally, there is copyright and, in some cases, other intellectual property rights in the content. Each party must avoid defamation, breach of another’s privacy rights or legislation.  A warranty or indemnity against material infringing third-party copyright may be required.

Issues of territoriality may arise.   Traditionally, a party may have the right to license the re-publication of material within a particular territory.   However, with Internet content, it is difficult to limit publication to particular territories only.

The payment structure will depend on the circumstances.   There may be a flat fee for recurrent content.   The fee may be based on the number of hits for the content concerned.   It may be based on quantity percentages of revenue that comes from the site.  There may be a commission-based fee based on revenue earned through advertisements and other means for the site.    Records and methods of tracking revenue would be required.

Provision should be made for the consequences of delay.   There may be a right to terminate for prolonged delays on the part of the other, usually the provider.   There may be service credits.

General termination provisions are likely to be provided.   On termination, the content would usually be required to be removed from the website.   Deleted copies may be required to be destroyed or returned.   If the materials have become mixed with the licensees, the licensee may wish to retain materials for archival or other purposes.

Domain Names

The domain name is used to identify the website on the internet.  There are different levels of the types of domain name such as .eu, .com, .org, .info. Top level domain names are handled by the Internet Corporation for Assigning Names and Numbers (ICANN).

Domain name disputes are determined under WIPO arbitration. The Internet Corporation of Assigned Names and Numbering (ICANN) requires that registrars of top-level domains use either the Uniform Dispute Resolution Procedure or Uniform Rapid Suspension Procedure. The WIPO and the (US) National Arbitration Forum provide services for dispute resolution.

In 2011 ICANN instituted a new generic top-level domain name programme which allowed any entity worldwide to run a generic top-level domain registry. Many large corporations applied such as.google,. [a city name]. The result has been that there are now thousands of generic top-level domain names. This has complicated the process of protecting the use of domain names through them. The new system includes a mechanism to deal with cases of clear cybersquatting.

Domain names are usually registered using a registration agent such as an internet service provider.  “. co.uk” domain names and accredited registrars are available on the Nominet website. The system ensures that every domain name is unique

Domain name rights can be taken away if it is proved that someone else has greater rights to the name.    It may be possible for a third party to prove it has greater rights to the name.   Dispute resolution procedures apply.