Before you sign a business contract, it pays to check twelve points. This checklist helps you recognise a number of common and potentially costly contract risks before you sign.
A contract often seems standard, until something goes wrong. That is when the clauses you skimmed turn out to be decisive. A contract supplied by the other party often reflects its own processes and risks first. Check whether the balance is acceptable for you too.
This checklist is intended for business owners and companies without an in-house lawyer. Go through the twelve points before you sign. Unsure about more than a few points? Then a professional contract review is advisable.
Is it clear which losses can be recovered, what cap applies and which exceptions or indemnities fall outside it? Without a clear cap, a single dispute can have major financial consequences.
Is liability mutually capped and proportionate to the value of the deal?
How long are you tied in and how do you cancel? A missed notice deadline can lead to unwanted renewal of months or years.
When and how can you cancel — and what happens if you miss that moment?
Does the contract renew automatically if you do nothing? Many contracts renew tacitly for a full new period.
Is the contract renewed automatically, and for what term?
May the other party raise the price unilaterally? Watch for indexation clauses and open-ended wording about rate adjustments.
Can the price go up mid-term, and do you have any say in it?
Is it clear who gets the rights to what is created — software, content, designs — and who may use, export and retain the data? There is no general ownership right in data as such.
Is it clear who owns the end result and the underlying data?
Is personal data processed and are the privacy roles correctly established? If one party processes data on behalf of the other, a data processing agreement (Article 28 GDPR) is required; where parties are independent or joint controllers, different arrangements apply.
Is there a data processing agreement when personal data is shared?
Does the contract require you to work exclusively with this party? Exclusivity can limit your negotiating position and flexibility.
Are you free to work with others as well?
How easily can you leave and take your data with you? Missing exit arrangements can lock you in to a supplier.
Do you get your data back and can you switch without high costs?
Is it clear which breach triggers which penalty, how it is calculated, whether a cap applies and whether it replaces or sits alongside damages? Penalties can escalate disproportionately.
Are the penalties reasonable and do they apply to both parties?
What may you share and not share, and for how long? An overly broad confidentiality clause can affect your normal business operations.
Is the confidentiality reasonable in scope and duration?
Which law applies and where are disputes handled? Foreign law or a distant court can make proceedings expensive and difficult.
Does Dutch law apply and is the dispute resolution mechanism workable for you?
Sometimes the biggest risk is what is missing. Think of service levels, warranties, or arrangements for what happens in the event of default.
Are you missing arrangements that you would actually want to set down?
For a standard Contract Review you receive a human-checked risk overview of your contract within two business days, with priorities and proposed wording where needed.