When do you need terms of service?

You need terms of service when operating a website, mobile app, online service, or digital platform. They're essential for protecting your business from legal liability, establishing user responsibilities, and complying with various laws and regulations.

What should be included in terms of service?

Terms of service should include user responsibilities, prohibited activities, intellectual property rights, liability limitations, dispute resolution procedures, termination rights, and applicable laws. They should also address privacy, data usage, and user-generated content.

Terms of Service Template (2025) - Download | Complete Guide & How to Fill Out

Q: What are terms of service?

Terms of service are legal agreements between a service provider and users that outline the rules, responsibilities, and restrictions governing the use of a website, app, or online service. They establish the legal relationship and set expectations for both parties.

What are Terms of Service?

Professional terms of service for websites, apps, and online businesses

Terms of service (TOS) are legal agreements between a service provider and users that outline the rules, responsibilities, and restrictions governing the use of a website, mobile app, or online service. They establish the legal relationship between the company and its users, setting clear expectations for both parties and providing legal protection for the business. Terms of service serve as the contractual foundation for digital services, defining user obligations, acceptable use policies, liability limitations, and dispute resolution procedures.

Terms of service are essential legal documents for any online business or digital platform, providing crucial protection against legal liability while establishing clear guidelines for user behavior and service usage. They help businesses comply with various laws and regulations, protect intellectual property, and limit legal exposure from user actions or service issues. Well-drafted terms of service can prevent costly disputes, provide grounds for account termination when necessary, and ensure compliance with consumer protection laws, privacy regulations, and industry-specific requirements.

📋 Key Components of Terms of Service

Service description - what your service provides and how it works
User responsibilities - obligations and acceptable use policies
Prohibited activities - what users cannot do on your platform
Intellectual property rights - ownership and usage rights
Liability limitations - disclaimers and damage limitations
Termination rights - conditions for ending service
Dispute resolution - how conflicts will be handled

Types of Online Services and TOS Requirements

Different types of online services and terms of service requirements

Service Type	Primary TOS Focus	Key Considerations	Special Requirements
E-commerce Websites	Sales terms and returns	Consumer protection compliance	Return policies, warranties
Social Media Platforms	User-generated content	Content moderation and IP rights	DMCA compliance, community standards
SaaS Applications	Service levels and data	Uptime guarantees, data security	SLA terms, data processing agreements
Mobile Apps	App store compliance	Platform-specific requirements	App store guidelines, device permissions
Content Platforms	Content licensing and usage	Creator rights, revenue sharing	Copyright policies, monetization terms

Website and Blog Terms of Service

Content Usage: Rights to use, reproduce, and distribute website content
User Comments: Policies for user-generated content and comments
Advertising: Third-party advertising and affiliate relationships
External Links: Disclaimers for linked websites and content
Information Accuracy: Disclaimers about content accuracy and timeliness
Accessibility: Compliance with accessibility standards and requirements

E-commerce and Marketplace Terms

Purchase Terms: Order processing, payment, and fulfillment procedures
Product Information: Accuracy of product descriptions and pricing
Return and Refund Policies: Customer rights and return procedures
Shipping Terms: Delivery responsibilities and risk transfer
Seller Obligations: Third-party seller responsibilities and marketplace rules
Consumer Rights: Compliance with consumer protection laws

Software and SaaS Terms

License Terms: Software usage rights and restrictions
Service Levels: Uptime guarantees and performance standards
Data Security: Security measures and breach notification procedures
Integration: Third-party integration and API usage terms
Updates and Maintenance: Software updates and maintenance schedules
Subscription Terms: Billing, renewal, and cancellation procedures

✅ Benefits of Comprehensive Terms of Service

Legal Protection: Shield against liability and user disputes
Clear Expectations: Establish user responsibilities and service boundaries
Regulatory Compliance: Meet legal requirements and industry standards
IP Protection: Protect intellectual property and content rights
Dispute Prevention: Reduce conflicts through clear guidelines

Essential Terms of Service Provisions

Service Description and Scope

Service Overview: Clear description of what your service provides
Service Availability: Operating hours, maintenance windows, and availability
Geographic Limitations: Regions where service is available or restricted
Service Modifications: Right to change, update, or discontinue services
New Features: Introduction of new features and functionality
Third-Party Services: Integration with external services and platforms

User Accounts and Registration

Account Creation: Requirements for creating user accounts
Account Information: Accuracy and maintenance of account details
Account Security: User responsibility for password and account security
Account Sharing: Restrictions on sharing account credentials
Account Suspension: Conditions for suspending or disabling accounts
Account Deletion: Procedures for account termination and data retention

Acceptable Use and Prohibited Activities

Lawful Use: Requirement to use service in compliance with applicable laws
Prohibited Content: Types of content that are not allowed
Harassment and Abuse: Policies against harassment, threats, and abusive behavior
Spam and Unwanted Communications: Restrictions on unsolicited communications
Security Violations: Prohibitions against hacking, malware, and security breaches
Commercial Use Restrictions: Limitations on commercial activities and resale

Intellectual Property Rights

Service IP Ownership: Company ownership of platform, technology, and content
User Content Rights: User retention of rights in their original content
License to Company: User grant of rights for company to use their content
Copyright Protection: DMCA compliance and copyright infringement procedures
Trademark Usage: Restrictions on use of company trademarks and logos
Third-Party IP: Respect for third-party intellectual property rights

Privacy and Data Protection

Privacy Policy Reference: Link to comprehensive privacy policy
Data Collection: Types of data collected and usage purposes
Data Sharing: When and how data may be shared with third parties
User Controls: User rights to access, modify, or delete their data
Data Security: Measures taken to protect user data
International Transfers: Cross-border data transfer disclosures

Payment and Billing Terms

Pricing and Fees: Cost structure and fee schedules
Payment Methods: Accepted payment methods and processing
Billing Cycles: Subscription billing and renewal terms
Late Payments: Consequences of late or failed payments
Refunds and Credits: Refund policies and credit procedures
Tax Responsibilities: User responsibility for applicable taxes

⚠️ Common Terms of Service Mistakes

Vague or overly broad language that may not be enforceable
Missing industry-specific requirements and regulations
Inadequate intellectual property and content protections
Insufficient liability limitations and disclaimers
Lack of proper dispute resolution and governing law clauses
Missing user notification procedures for changes and updates

How to Fill Out Terms of Service: Step-by-Step Guide

Professional completing terms of service documentation and legal forms

1

Define Service Description and User Responsibilities

Establish: Clear service overview and user obligations.

Describe your service, platform, or website functionality
Define user eligibility requirements and registration process
Establish acceptable use policies and user conduct standards
List prohibited activities and content restrictions
Include account security and maintenance responsibilities

2

Address Intellectual Property and Content Rights

Protect: IP ownership and establish content usage rights.

Assert company ownership of platform, technology, and original content
Define user content ownership and licensing terms
Include DMCA compliance and copyright infringement procedures
Address trademark usage and brand protection
Establish user-generated content policies and moderation rights

3

Include Privacy and Data Protection Provisions

Address: Data collection, usage, and privacy protections.

Reference comprehensive privacy policy and data practices
Describe data collection, usage, and sharing practices
Include user rights and data control mechanisms
Address international data transfers and compliance
Establish data security and breach notification procedures

4

Set Payment Terms and Commercial Provisions

Define: Pricing, billing, and commercial relationship terms.

Establish pricing structure and fee schedules
Define payment methods, billing cycles, and renewal terms
Include refund policies and cancellation procedures
Address tax responsibilities and compliance
Set late payment consequences and collection procedures

5

Add Liability Limitations and Legal Protections

Include: Disclaimers, liability caps, and risk allocation.

Add comprehensive service disclaimers and "as-is" provisions
Include liability limitations and damage caps
Add indemnification clauses for user actions
Include force majeure and unforeseeable event provisions
Address third-party service disclaimers and limitations

6

Include Termination and Legal Framework

Establish: Termination rights and legal governance framework.

Define termination rights for both parties
Include dispute resolution procedures and arbitration clauses
Set governing law and jurisdiction for legal matters
Add modification procedures for updating terms
Include severability and entire agreement provisions

⚠️ Technology Law and Regulatory Compliance

Terms of service involve complex technology law, consumer protection, and regulatory compliance issues that vary by jurisdiction and industry. These agreements must comply with privacy laws (GDPR, CCPA), accessibility requirements (ADA), consumer protection regulations, and platform-specific rules (app stores). Professional legal advice from experienced technology attorneys is essential for proper terms drafting, liability protection, and regulatory compliance. Consider international law implications, industry-specific requirements, and evolving digital regulations.

Industry-Specific Terms of Service Considerations

Healthcare and Medical Services

HIPAA Compliance: Health information privacy and security requirements
Medical Disclaimers: Clear disclaimers that service is not medical advice
Professional Licensing: Requirements for licensed healthcare providers
Emergency Situations: Limitations on emergency medical services
FDA Regulations: Compliance with medical device and drug regulations
Telemedicine Laws: State-specific telemedicine licensing and requirements

Financial and Fintech Services

Financial Regulations: Compliance with banking and financial service laws
Consumer Finance Protection: CFPB and state consumer protection compliance
Investment Advice: Disclaimers for investment and financial advice
Anti-Money Laundering: AML and Know Your Customer (KYC) requirements
Data Security: PCI DSS and financial data protection standards
Licensing Requirements: Financial service licensing and registration

Educational Technology

COPPA Compliance: Children's online privacy protection requirements
FERPA Compliance: Educational record privacy and access rights
Student Data Protection: State student data privacy laws
Accessibility: Section 508 and educational accessibility requirements
Content Standards: Educational content accuracy and appropriateness
Parental Consent: Requirements for services used by minors

Gaming and Entertainment

Age Restrictions: Age verification and parental consent requirements
Virtual Goods: Terms for in-game purchases and virtual currencies
Content Rating: Compliance with ESRB and international rating systems
User-Generated Content: Content moderation and community standards
Gambling Regulations: Compliance with gambling and lottery laws
International Markets: Country-specific gaming regulations and restrictions

Food and Agriculture

FDA Regulations: Food safety and labeling requirements
Nutritional Claims: Health and nutritional claim substantiation
Allergen Disclosures: Food allergen labeling and warnings
Organic Certification: USDA organic labeling and certification
State Regulations: State-specific food service and delivery laws
International Trade: Import/export regulations for food products

Real Estate and Property

Real Estate Licensing: Requirements for real estate professionals
Fair Housing Laws: Compliance with fair housing and anti-discrimination laws
Property Disclosures: Required property condition and history disclosures
Rental Regulations: Landlord-tenant laws and rental property regulations
Professional Standards: MLS and real estate professional conduct standards
State Variations: State-specific real estate laws and requirements

💡 Industry Compliance Best Practices

Research industry-specific regulations and compliance requirements
Consult with legal experts familiar with your industry
Review competitor terms of service for industry standards
Consider international regulations if serving global markets
Implement regular compliance reviews and updates
Maintain documentation of compliance efforts and legal advice

Frequently Asked Questions

Yes, terms of service are essential for virtually any website, app, or online service. They provide legal protection, establish user responsibilities, help comply with laws and regulations, protect intellectual property, and provide grounds for account termination when necessary. Even simple websites benefit from terms of service to limit liability and establish the legal relationship with users. Many jurisdictions and platforms (like app stores) require terms of service for certain types of services.

To make terms of service enforceable: (1) Ensure users agree to terms before using the service (click-wrap or sign-up agreements), (2) Make terms easily accessible with clear links, (3) Use clear, understandable language, (4) Avoid unconscionable or overly one-sided terms, (5) Include proper dispute resolution and governing law clauses, (6) Provide notice of changes and obtain renewed consent, and (7) Ensure terms comply with applicable laws. Professional legal review is recommended for enforceability.

Terms of service govern the overall use of your service and establish the legal relationship between you and users, while privacy policies specifically address how personal data is collected, used, stored, and protected. Terms of service cover user responsibilities, prohibited activities, intellectual property, liability, and service terms. Privacy policies focus on data practices, user privacy rights, and compliance with privacy laws like GDPR and CCPA. Both documents are important and often complement each other.

Update terms of service when: (1) Adding new features or services, (2) Changing business model or pricing, (3) Addressing new legal requirements or regulations, (4) Responding to user behavior or platform issues, (5) Updating liability or dispute resolution terms, (6) Expanding to new jurisdictions, or (7) Following major legal or regulatory changes. Generally, review terms annually and update as needed. Always notify users of material changes and consider requiring renewed acceptance for significant modifications.

No, you should not copy terms of service from other websites. Terms of service are copyrightable documents and copying them may infringe copyright. More importantly, other companies' terms may not fit your specific business model, jurisdiction, or legal needs. Each business has unique requirements, risks, and regulatory obligations. Instead, use professional templates as starting points and customize them for your specific situation, or work with legal Exit strategy and liquidity limitations. The disclosure should be sufficiently detailed to allow investors to make informed investment decisions.

SAFE and convertible note subscriptions should address: (1) Conversion triggers (qualified financing, liquidity events, maturity), (2) Valuation caps and discount rates for investor protection, (3) Most favored nation provisions for future investor rights, (4) Pro rata participation rights in future rounds, (5) Information rights and reporting requirements, (6) For notes: interest rates, maturity dates, and default provisions, (7) Anti-dilution protection and adjustment mechanisms, and (8) Dissolution and liquidation preferences. These instruments provide flexible early-stage funding while deferring valuation discussions.

Non-compliance consequences include: (1) SEC enforcement actions and penalties, (2) State securities violations and sanctions, (3) Investor rescission rights and damage claims, (4) Criminal liability for willful violations, (5) Disqualification from future exemptions, (6) Disgorgement of proceeds and monetary penalties, (7) Injunctive relief preventing future offerings, and (8) Reputational damage and business disruption. Proper legal counsel and compliance procedures are essential to avoid these serious consequences.

International investors require consideration of: (1) Regulation S compliance for offshore transactions, (2) No U.S. solicitation or directed selling efforts, (3) Distribution compliance periods for resale restrictions, (4) Category-specific offering restrictions by jurisdiction, (5) FATCA reporting and withholding requirements, (6) Tax treaty benefits and withholding optimization, (7) Anti-money laundering and KYC procedures, and (8) Local securities law compliance in investor jurisdictions. Specialized legal counsel is recommended for international offerings.

Preferred stock subscriptions should include: (1) Liquidation preferences and participation rights, (2) Dividend rates and payment terms, (3) Anti-dilution protection (weighted average or full ratchet), (4) Conversion rights and automatic conversion triggers, (5) Voting rights and protective provisions, (6) Board representation and governance rights, (7) Information and inspection rights, (8) Tag-along and drag-along provisions, (9) Right of first refusal and co-sale rights, and (10) Registration rights for future liquidity. These terms define the economic and control rights of preferred investors.

Risk Factors and Due Diligence Considerations

Business and Operational Risks

Market Competition: Competitive pressures and market saturation risks
Technology Dependence: Reliance on proprietary or third-party technology
Key Personnel: Dependence on key management and technical personnel
Customer Concentration: Reliance on major customers or distribution channels
Regulatory Changes: Impact of changing industry regulations
Economic Conditions: Sensitivity to economic downturns and market conditions

Financial and Liquidity Risks

Going Concern: Ability to continue operations and meet obligations
Capital Requirements: Future funding needs and dilution risk
Revenue Concentration: Dependence on limited revenue sources
Liquidity Limitations: Restricted transferability and exit options
Valuation Uncertainty: Difficulty in determining fair value
Loss of Investment: Risk of total loss of invested capital

Legal and Regulatory Risks

Securities Law Compliance: Ongoing compliance with exemption requirements
Intellectual Property: IP disputes and infringement claims
Litigation Exposure: Pending and potential legal proceedings
Regulatory Approval: Required licenses and governmental approvals
Environmental Liability: Environmental compliance and cleanup costs
Data Privacy: Compliance with data protection regulations

Investment-Specific Risks

Minority Position: Limited control and influence over company decisions
Dilution Risk: Future equity issuances reducing ownership percentage
Liquidation Preference: Junior status to preferred shareholders
Tag-Along/Drag-Along: Forced participation in sale transactions
Board Representation: Limited or no board representation rights
Information Access: Restricted access to company information

Technology and Cybersecurity Risks

Cybersecurity Threats: Data breaches and cyber attacks
Technology Obsolescence: Rapid technological changes
System Failures: IT system disruptions and failures
Data Loss: Loss of critical business data
Third-Party Dependencies: Reliance on external technology providers
Compliance Requirements: Technology-related regulatory compliance

Due Diligence Areas

Financial Review: Financial statements, projections, and accounting practices
Legal Analysis: Corporate structure, material contracts, and litigation
Business Assessment: Market position, competitive advantages, and strategy
Management Evaluation: Leadership team experience and track record
Technology Review: IP portfolio, technology stack, and development capabilities
Operational Analysis: Business processes, scalability, and operational efficiency

⚠️ Critical Risk Disclosure Requirements

Comprehensive disclosure of all material risks and uncertainties
Specific risks related to the company's business and industry
Investment-specific risks including liquidity and control limitations
Forward-looking statement disclaimers and projection risks
Regular updates on material changes and developments
Professional liability and D&O insurance coverage limitations

International and Tax Considerations

Cross-Border Investment Structures

Regulation S Compliance: Offshore transactions with no U.S. solicitation
Category Classifications: Different restrictions based on investor jurisdiction
Distribution Compliance Period: Restricted period for U.S. resales
Offshore Intermediaries: Use of international placement agents
Local Law Compliance: Securities regulations in investor jurisdictions
Currency Considerations: Multi-currency investments and hedging

Tax Implications for Investors

Capital Gains Treatment: Long-term vs. short-term capital gains
Section 1202 Benefits: Qualified small business stock exclusion
Section 83(b) Elections: Early tax recognition for restricted stock
Passive Activity Rules: Limitations on loss deductions
At-Risk Limitations: Restrictions on deductible losses
State Tax Considerations: Varying state tax treatments

International Tax Compliance

FATCA Reporting: Foreign Account Tax Compliance Act requirements
Withholding Obligations: U.S. withholding on foreign investors
Tax Treaty Benefits: Reduced withholding rates under treaties
CRS Reporting: Common Reporting Standard for automatic information exchange
Transfer Pricing: Related party transaction pricing
Permanent Establishment: Tax presence in multiple jurisdictions

Entity Structure Considerations

Pass-Through Entities: LLCs, partnerships, and S corporations
Corporate Structure: C corporation tax treatment
Delaware vs. Other States: Incorporation jurisdiction benefits
International Holding Companies: Offshore structure optimization
Investment Funds: Fund structure for multiple investors
Blocker Structures: Preventing UBTI for tax-exempt investors

Anti-Money Laundering (AML) and KYC

Customer Identification: Identity verification requirements
Beneficial Ownership: Ultimate beneficial owner identification
Source of Funds: Documentation of investment source
Sanctions Screening: OFAC and international sanctions compliance
PEP Identification: Politically exposed person screening
Ongoing Monitoring: Continuous compliance and updates

Regulatory Considerations by Jurisdiction

European Union: MiFID II and Prospectus Regulation compliance
United Kingdom: FCA rules and Brexit implications
Canada: Provincial securities regulations and passport system
Asia-Pacific: Jurisdiction-specific offering requirements
Emerging Markets: Capital controls and foreign investment restrictions
Tax Havens: Substance requirements and regulatory scrutiny

💡 International Investment Best Practices

Engage experienced international securities counsel in relevant jurisdictions
Implement robust KYC and AML procedures for international investors
Consider tax-efficient structures for cross-border investments
Ensure compliance with FATCA and CRS reporting requirements
Review withholding and treaty obligations for foreign payments
Monitor regulatory changes in key investor jurisdictions

Post-Investment Management and Ongoing Compliance

Investor Relations and Communication

Regular Reporting: Quarterly and annual investor updates
Financial Statements: Audited and interim financial reporting
Business Updates: Material developments and milestone progress
Board Communications: Board meeting minutes and resolutions
Information Rights: Inspection and information access procedures
Investor Meetings: Annual meetings and special presentations

Securities Law Compliance

Form D Filings: Timely filing of federal notice forms
State Filings: Blue sky law compliance and renewal filings
Annual Updates: Ongoing exemption maintenance
Transfer Monitoring: Tracking secondary transfers and compliance
Beneficial Ownership: Section 16 and beneficial ownership reporting
Integration Issues: Coordination with subsequent offerings

Corporate Governance

Board Composition: Investor representation and independent directors
Voting Agreements: Coordination of voting and governance rights
Protective Provisions: Investor approval rights and veto powers
Committee Structure: Audit, compensation, and governance committees
Conflict Management: Related party transactions and conflicts
Fiduciary Duties: Director and officer obligations

Liquidity and Exit Planning

Exit Strategy Development: IPO, strategic sale, or management buyout planning
Registration Rights: Demand and piggyback registration procedures
Tag-Along Rights: Participation in third-party sales
Drag-Along Rights: Forced participation in majority sales
Right of First Refusal: Company and investor preemptive rights
Valuation Methodology: Fair value determinations for transfers

Risk Management and Insurance

Directors and Officers Insurance: Liability coverage for management
Errors and Omissions: Professional liability coverage
Cyber Liability: Data breach and cybersecurity insurance
General Liability: Business operations and premises coverage
Key Person Insurance: Life insurance on critical personnel
Representations and Warranties: Transaction-specific insurance

Performance Monitoring and Reporting

Key Performance Indicators: Business and financial metrics tracking
Milestone Achievement: Progress against business plan objectives
Financial Controls: Internal controls and audit procedures
Compliance Monitoring: Regulatory and contractual compliance
Benchmarking: Industry and peer comparison analysis
Value Creation: Strategic initiatives and growth opportunities

✅ Post-Investment Success Factors

Establish clear investor communication and reporting procedures
Maintain ongoing securities law and regulatory compliance
Implement strong corporate governance and oversight structures
Plan for liquidity events and exit opportunities
Monitor performance against business plan and investor expectations
Maintain appropriate insurance coverage for business risks

Download Your Subscription Agreement Template

Download professional subscription agreement template

Our comprehensive subscription agreement template includes all the essential provisions you need to properly structure and document private securities offerings. The template is professionally drafted by experienced securities attorneys and can be customized for various offering types and investment structures.

What's Included in Our Template:

Complete Agreement Framework: All essential sections and securities law provisions for comprehensive private offerings
Flexible Structure: Customizable for different securities types and offering structures
Regulatory Compliance: Comprehensive securities law compliance and exemption provisions
Investor Protection: Detailed representations, warranties, and disclosure requirements
Implementation Guide: Step-by-step instructions for offering preparation and execution
Supporting Documents: Investor qualification forms and verification procedures

💼 Template Features

Covers all major subscription agreement provisions and requirements
Includes both standard and sophisticated investment structures
Professional legal drafting with clear language and comprehensive terms
Customizable for various offering types and securities structures
Current with latest securities law and regulatory developments
Compatible with federal and state private offering exemptions

Download Subscription Agreement Template

⚠️ Important Legal and Securities Disclaimer

This template is provided for informational purposes only and does not constitute legal, investment, or securities advice. Subscription agreements involve complex federal and state securities laws, investor qualification requirements, and regulatory compliance issues that vary by jurisdiction, offering type, and investor characteristics. While our templates are professionally prepared, every securities offering is unique and may require specific legal, regulatory, and compliance provisions. We strongly recommend consulting with qualified securities attorneys, compliance professionals, and investment advisors to ensure your subscription agreement meets your specific needs and complies with all applicable securities laws and regulations.

Terms of Service Template 2025