Master Service Agreement Overview & Template

What is a Master Service Agreement?

A master service agreement is an agreement which specifies performance objectives and outlines the responsibilities of both parties. Furthermore, this contractual document lists the current and prospective services to which the agreement applies. It is a contract in which the parties agree to most of the terms that will govern future transactions or future agreements. It provides accountable framework for the services to be provided. Contracts such as these are useful in sectors that involve a large number of transactions between the provider of service as well as a customer and may include a separate statement of work for each.

Applicable Law

The principles of contract under Contract Act, 1872 would govern these agreements. Further, the Consumer Protection Act, 1986, also applies to all goods and services, excluding goods for resale or for commercial purpose and services rendered free of charge and under a contract for personal service. It protects rights of customers such as right to be informed, right to safety etc.

Goods and Services Tax (GST) is applicable on supply of services at different rates for different categories of services other than a few services which are exempt.

Advantages of Master Service Agreement

  • MSAs help companies avoid contractual disputes.
  • It also helps in reducing the risk of litigation.
  • That speeds up the negotiating process.
  • An MSA still protects both parties.
  • When a dispute arises, the MSA decides who is at fault.
  • A good MSA works as a template for future negotiations.
  • Since checking the document is easy, the two businesses are less likely to use which saves time and money.
  • Additionally, the criteria is simplified through a master service agreement as it describes the issues beforehand they are likely to occur.
  • It affiliates programs which are often used to define how two entities should function collectively. Thus, it is a well-defined method of doing a particular service.

Key Contents in a Master Service Agreement

  • Confidentiality
    • This segment normally requires the seller to keep all the data, information and materials of the client found amid the execution of the services to maintain the privacy & not to impart it with third parties.
  • Dispute Resolution
    • If problems arise, then the MSA states how the parties can resolve their conflict.
  • Intellectual Property
    • The parties also decide a way to handle possession and usage of all patients and alternative IPs.
  • Payment Terms
    • These terms show the expected value still because of the payment schedule.
  • Venue of law
    • Additionally, The MSA identifies the place where any legal resolution can occur. This might embrace arbitration or a selected state/federal court.
  • Warranties
    • The teams agree on the coverage and scope of the assurance.
  • Work Standards
    • This part of the MSA states what each party considers acceptable work. Failing to live up to the work standards is a frequent cause of disputes.
Master Service Level Agreement Template
Download Master Service Level agreement for your Company when onboarding service providers
Download
Master Service Level Agreement Template
Download Master Service Level agreement for your Company when onboarding service providers
Download

FAQs

What is the difference between a MSA and SLA?

A Master Service Agreement (or MSA) is a typical contract between two parties that lists out the terms that govern all of their future transactions or future agreements. On the other hand, a Service Level Agreement (SLA) is an agreement specifically between the service provider and a client / a service user.

What Is The Purpose Of MSA?

The MSA is a base agreement through which every future contract between the parties will be guided.

What if one party to the agreement does not deliver the services promised

A MSA is like any other contract. You can exercise your legal rights and take legal action on the other party.

Got Questions? Ask Away!

  1. Hey @HarshitShah

    Yes. Any time the terms of the agreement change, this should be documented in a new contract. The new contract should also make clear this contract replaces the old contract.