Commercial Contracts Practice
Our Commercial Contracts practice drafts, reviews, and negotiates commercial agreements of all types across India and conducts periodic reviews of our clients’ standard form contract portfolios to identify latent risk. In our experience of representing clients in commercial disputes across India, the majority of those disputes were preventable — caused not by bad faith but by provisions drafted too loosely, borrowed from templates designed for different jurisdictions, or never reviewed by lawyers who understood what the clauses would mean when the relationship broke down.
- The contracts that create the most litigation are not the complex bespoke ones — they are the standard forms that nobody reviewed. A corrected clause in a standard form applies across every contract using that form from the date of revision.
- Limitation of liability clauses that cap one party’s exposure at the contract value or at a fixed sum below any commercially meaningful recovery make the contract effectively uninsured. We advise on liability cap structures that reflect the actual risk profile of each commercial relationship.
- Under Indian copyright law, the author is the first owner of copyright unless there is a written assignment. An IP ownership clause that is silent on who owns work product created by a vendor means the vendor owns what they built for the customer.
- Dispute resolution clauses that specify arbitration are only effective if they specify the seat, the governing law, the arbitral rules, and the number of arbitrators. Incompletely drafted arbitration clauses generate satellite litigation about the clause itself.
- Standard terms in use before the Digital Personal Data Protection Act, 2023, the current GST framework, or the evolved Indian arbitration landscape are carrying latent risk across the entire contract portfolio.
1. Standard Form Contract Audits — Our Portfolio Review Practice
We conduct periodic reviews of our clients’ standard form contract portfolios — vendor agreements, distributor terms, customer agreements, service agreements — identifying provisions that carry latent risk and recommending specific amendments. The value of this exercise is that a corrected clause applies across every contract using that form from the date of revision. Standard terms in use before the Digital Personal Data Protection Act, 2023, the current GST framework, or the Arbitration and Conciliation (Amendment) Act, 2021 are carrying risk that most businesses have not assessed.
2. Distribution, Supply, and Vendor Agreements
We draft and negotiate distribution agreements, exclusive dealer arrangements, authorised reseller terms, and supply contracts. The commercially critical provisions we focus on: territorial scope and exclusivity linked to minimum performance obligations; product liability allocation and indemnity from manufacturer to distributor; and post-termination obligations including stock return, de-branding, and non-compete provisions.
For international distribution and supply arrangements, we advise on FEMA compliance, transfer pricing considerations, and the governing law and jurisdiction provisions that will determine which forum hears a dispute if one arises.
3. Technology Licensing and Service Agreements
We draft and negotiate technology licensing agreements, SaaS agreements, IT service agreements, and cloud computing contracts. The IP ownership question — who owns the software, the data, and the customisations created during the relationship — is the most consequential provision in most technology contracts and is the one most frequently left ambiguous by template agreements. We advise on explicit IP ownership allocation, on the scope of licences granted to each party, and on the continuation of rights after termination.
Under the Digital Personal Data Protection Act, 2023 and the Information Technology Act, 2000, technology service agreements must address data processing obligations, security requirements, breach notification procedures, and the parties’ respective roles as data fiduciary and data processor.
“Under Indian copyright law, the creating party owns the work unless there is a written assignment. Silence in a technology services contract means the vendor owns what they built for the customer.”
4. Joint Venture and Collaboration Agreements
We advise on joint venture agreements, collaboration arrangements, and consortium agreements. The provisions that determine the outcome of a joint venture dispute are: the governance structure and decision-making majority; the deadlock resolution mechanism; the conditions for and consequences of exit by one party; the non-compete obligations on each party after termination; and the allocation of IP ownership — both existing IP contributed and new IP developed through the joint venture. Joint venture disputes are consistently among the most expensive commercial disputes a business will encounter; we draft to govern the worst case, not the best. Across 13 partners and 220+ professionals from offices in New Delhi, Mumbai, Chennai, Hyderabad, and Bangalore.
Frequently Asked Questions
commercial-contracts-practice-faq
In our experience of commercial disputes before courts and arbitral tribunals in India, the provisions that most commonly determine outcomes are: the limitation of liability clause (whether it is reciprocal, what the cap is, and what consequential losses are excluded); the IP ownership clause (particularly where work product is created by a contractor or vendor); the force majeure definition (what events qualify and what the parties’ obligations are during and after the event); and the dispute resolution clause (whether the arbitration clause is enforceable, complete, and clearly designates a seat, rules, and number of arbitrators).
Under Section 17 of the Copyright Act, 1957, the author is the first owner of copyright unless one of the specified exceptions applies. For software, creative works, and other copyrightable deliverables created by a vendor or contractor for a customer, the vendor is the first owner unless the contract contains a written assignment of copyright to the customer. The same principle applies in other IP contexts: patent ownership vests in the inventor unless there is a valid assignment. IP ownership provisions that are silent on who owns work product default in favour of the creating party.
Indian courts do not recognise an implied force majeure doctrine — relief from performance on the basis of supervening impossibility depends on the terms of the contract or, in limited circumstances, on the doctrine of frustration under Section 56 of the Indian Contract Act, 1872. The doctrine of frustration under Section 56 is applied narrowly in India: it requires that the contract has become impossible to perform, not merely more difficult or expensive. Force majeure clauses in commercial contracts must therefore be specific about the events covered, the obligations during a force majeure event, and the consequences if the event continues beyond a specified period.
A limitation of liability clause in a commercial contract caps one or both parties’ maximum exposure to claims arising from the contract — typically as a multiple of fees paid under the contract, a fixed sum, or by exclusion of specified categories of loss (consequential loss, loss of profit, loss of data). Where the cap is set below any commercially meaningful recovery for the other party — which is common in technology service agreements where the cap equals one year’s fees — the contract is effectively uninsured from the customer’s perspective. We advise on liability cap structures calibrated to the actual risk profile of each commercial relationship.
An arbitration clause is enforceable in India if it satisfies the requirements of Section 7 of the Arbitration and Conciliation Act, 1996: it must be in writing (which includes an exchange of communications); it must constitute or incorporate an agreement to refer disputes to arbitration; and it must identify either the disputes to be referred or provide a mechanism for doing so. Incompletely drafted clauses — specifying arbitration without designating the seat, the rules, or the number of arbitrators — frequently generate satellite litigation about the clause itself before the substantive dispute can be resolved.