Negotiating a Terms of Service Agreement

Federal-compatible Terms of Service (TOS) agreements are special agreements negotiated between the federal government and many vendors who offer social media, mobile, business and other digital tools. These TOS agreements modify or remove problematic clauses in standard TOS agreements, and allow federal employees to legally use these tools.

Follow this step-by-step guide to find out if you need a TOS and how to get one.

What you should know about Terms of Service

A federal-compatible TOS is required for official government use of social media tools that are offered to the agency at no cost. Some fee-for-service products also require a federal-compatible TOS, and those are handled on a case-by-case basis.

• What it is
  Terms of Service agreements reflect the ability of the government to legally do business with a company (for a no-cost tool).
• What it isn’t
  Terms of Service agreements do not necessarily address privacy, security, accessibility, records, etc. All third-party social media technologies are still subject to the standards and policies that govern web communications. A signed TOS does not indicate that a tool meets these requirements and additional considerations may be necessary. All of those must be evaluated by the relevant agency in the context of the how the tool will be used.

Learn more about Federal-Compatible Terms of Service Agreements

Getting started

Program staff are typically the first to identify innovative third-party tools that may not have an established TOS amendment for use by the federal government.

• Check the list
  GSA and HHS both maintain a list of TOS agreements that are available. Check the list to confirm that the product you are interested in, or a suitable alternative, is not currently available.
• Contact your POC
  Contact the HHS TOS Point of Contact (POC) at [email protected] if the desired product is not available. Your POC will review the standard TOS and determine the next step.
  
  The two most common terms found in typical terms of service agreements that the federal government cannot agree to are indemnification and jurisdiction for governing law.
  • An indemnification clause states that an agency would agree to pay legal costs if involved in a future legal dispute. This violates the restrictions of Anti-Deficiency Act and Adequacy of Appropriations Act, because agencies cannot agree to obligate federal funds for a fiscal year that have not been appropriated by Congress.
  • A clause referencing governing law or jurisdiction typically identifies a specific governing state or court system in which disputes will be settled. However, the federal government is controlled by federal, not state, law, and legal disputes involving the federal government must be heard in federal, not state, courts.
• Connect with GSA and OGC
  The POC will review the terms of service and consult GSA to determine if there is another agency already working with the vendor, or to determine if there is additional interest in the tool across the federal government. When you discuss with your POC how to proceed, he or she may then recommend that you work with the legal counsel for your program and reach out to the vendor to begin the process of obtaining a federal-friendly TOS. If you do not know the legal counsel that supports your office, your POC should be able to make the connection there too.

Initiate the conversation

After you have received the green light from your agency POC, GSA, and your legal counsel, you can reach out to the vendor to inquire about a government terms of service and begin the process.

• Make contact
  Identify the best point of contact for the vendor. This might be a customer support or sales email address, or you may find specific contact information within the terms of service.

• Don’t overwhelm the vendor
  For your first contact, ask the vendor if they have a government licensing model or if they have worked with federal agencies. Many vendors will likely be unfamiliar with these federal-friendly terms and the legal barriers government agencies face, but your first goal is to connect with someone inside the company. Too much information in an email may result in your message being ignored.

• Schedule a call
  You may want to introduce the concept of the federal friendly TOS and request a call to discuss in detail. Terms of service negotiations may seem like a complex topic with lots of legalese, but a brief conversation can often make the concept and process less intimidating. When scheduling the call, you may also want to include your TOS POC and relevant legal counsel.

Anticipate the vendor’s perspective

There are many reasons why a vendor may be resistant to developing a federal friendly TOS (lack of time, priority, legal support, understanding/ familiarity, interest, money, etc.). Listen to what they are telling you and be prepared to address their concerns.

• Small start-ups
  It can be difficult for a small start-up company to understand why they should be inclined to put in the work to modify their legal terms to provide a service to a non-paying customer.

• Trying to make money
  It is important to convey that creating a federal-friendly TOS does not have to mean a significant cost or effort burden for the vendor.

Let the vendor know what is in it for them

Federal agencies wishing to work with vendors should be prepared to explain the background, importance, and benefits of a federal-friendly terms of service amendment to companies that are unfamiliar with doing business with the federal government

• It’s good for business
  • Adapting the terms of service for your product opens up a whole new market segment.
  • There is an active community within the federal government that includes hundreds of members from agencies across the federal government, who share experience and advice about new and innovative tools, heightening the visibility of your product through virtual word of mouth in the federal community.
  • Working with the federal government means that such innovative tools also receive high-level public exposure.
• It’s good for American citizens
  • Your product can impact and improve the lives of American citizens.
  • Your product can help agencies reach a broader audience, allow the public to provide feedback on federal services, and improve the way the government delivers services to the public, in an innovative and efficient manner.
• It’s good for taxpayers (and government agencies)
  • You product can save taxpayers money by allowing government agencies to deliver better, faster services to a wider audience and as cost-efficient stewards of public tax dollars.
  • Adapting the terms of service for your product allows government agencies to do more with less.
• Everyone else is doing it, including other start-ups and competitors
  • Refer vendors to the list of other companies that have established a federal terms of service to demonstrate the variety of products, and that there are both big companies and small start-ups on the list.

Make it easy

After explaining the benefits of adopting a federal-friendly TOS amendment, agencies will want to reassure vendors that the process can be simple and speedy.

• Explain options using examples from other vendors
  Share a summary of specifically how several other vendors have chosen to amend their TOS.
  
  Vendors typically do this in one of two ways:
  1. Explicitly state in the current terms of service where certain terms do or do not apply to the federal government (by way of example, you could indicate in the existing clause on law and jurisdiction, that if the user is a federal agency, federal law and federal courts will be used instead of a state court).
  2. Where possible, give the vendor a link to an amended TOS specifically for government agencies. (See the link to an example of how this is done by goanimate with whom HHS negotiated a TOS agreement: http://goanimate.com/business/videoplans/federal )
• Share model TOS
  Many companies have chosen to place a link at the top or bottom of their standard terms, which then links to an amendment for government agencies based on the model TOS provided by GSA.

Follow-up & manage the relationship

At this point, the vendor will likely need to consult with their internal team to decide if they would like to pursue the federal-friendly TOS. They may come back with modifications to the model TOS amendment, at which point you will work with your legal counsel to arrive at an acceptable TOS.

Building the relationship with the vendor is also important, because many vendors are interested in your feedback on the tool and potential improvements to meet the needs of their new federal market.

Keep in mind that the TOS is intended to make it legally acceptable for federal agencies to obtain services from a vendor. They are not intended to prescribe what a vendor’s service must do. As such, agencies should remember to balance “must have” terms with “nice to have” terms. While these TOS amendments resolve the major legal issues of the sign-up process, agencies are responsible for reviewing the product in the context of their needs and objectives, as well as the applicable laws and regulations on security, privacy, accessibility, records retention, ethical use, and other specific agency policies and requirements when using the tools.

As you finalize an acceptable terms of service amendment, be sure you have included your agency POC and GSA for awareness and final input. Your work will not only help your team to innovate, but will also open up doors for innovation across your agency and the federal government.

Still have questions?

Contact [email protected].