Master Service Agreement
Master Service Agreement (known as “MSA”) is an agreement made by businesses to decide terms for future transactions. Master services agreement helps both the customers and management during work on any project and the purpose of such an agreement to resolve the disputes and sets out the right and obligation of each party. An agreement certain parties that enlist the terms and conditions for all the matters which are ancillary to any specific transactions. The MSA is executed once which can be amended from time to time and again to incorporate general matters and updating. The benefits can be as follows:-
- It helps the parties to understand rights, obligations, and responsibilities.
- The aim of the master service agreement is to make the contract process faster and saves time and money.
- It helps to avoid or end disputes between parties.
- Master services agreements share the burden of each party so all parties are responsible for his work.
- It improved confidentiality between the parties.
- Master Service agreement speeds up the process of work because each party knows his work.
Terms and conditions of Master Service Agreement
An MSA is prepared like any other agreements and thus contains some special covenants explicitly which are as follows amongst others:-
- Intellectual property ownership: – Entities who are the owner of the intellectual property rights like copyright, trademark, patents, etc. master service agreement does not give any right or obligation to use such intellectual property.
- Confidentiality of information: – the parties must ensure they not disclose the confidential information and also contain the steps for how the disputes resolved.
- Dispute resolution steps: – Steps should contain how disputes resolved and the venue of laws where legal disputes resolved.
- Insurance: – If any risk involved with the project insurance and any security-related services details must be mentioned in the agreement.
- Responsibilities and warranties: – Each party gives warranties or a guarantee that proves it has not falsely identities itself and also not provides false information.
- Limitation of liability: – In contract contained the liabilities of all the parties, amount of liabilities and the time limits when the parties paid off liabilities.
- Payment schedule and terms: – In agreement should contain the estimated cost of service and schedule for payments.
- Modification of services: – If any customer or the entity wants to change or modify any services or agreements the steps should be contained in the agreement.
- Termination of agreement: – In the case of completion of projects or both parties want to terminate agreements the procedure of termination of the contract should be contained in the agreement.
- Delivery Requirement: the business decide who will deliver what and when
Information required for the Master Service Agreement
There are the following documents required for the master service agreement:-
- Incorporation certificate of the entity.
- Identity and address proof of the applicant.
- Address proof of the business premises.
- Rent agreement in case of rental property or the No Objection Certificate (“NOC”) of the owner’s property.
- Financial Statements of the previous financial year.
- Any government-approved ID proofs such as Aadhaar card, PAN card, etc.
Why Master Service Agreement?
- Risk & taxes Allocation
- General Terms & Conditions
- Better Alliance formation
- Proper Division of responsibilities
- Recognition of document with legal enforceability
Make sure the agreement accurately framed and describes all the work otherwise it creates conflicts of interest or more chances confidential information fall into wrong hands. The parties already know the terms or work transactions and can use such terms and make fault quickly.
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