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Software Agreement Guidelines

The development of software by a supplier. The purchase and enhancement of off-the-shelf application packages. It includes an agreement template

Source: ITANZ
Jun 24, 2002
Reprinted by the courtesy of Information Technology Association of New Zealand. Please note that the article may be slightly country-specific when it comes to legal issues.

This paper is one of a series of guidelines prepared by the Information Technology Association of New Zealand (ITANZ) to assist organisations undertaking technology purchases. These guidelines are intended to provide advice and assistance to organisations considering technology acquisition and to set out a basis for the development of a formal agreement.

This paper addresses the issues relating to both software development by a third party and to the purchase and enhancement of off-the-shelf application packages. Note that for the purposes of this paper application package means a suite of software addressing a particular business need e.g. a financial system. It does not include the supply of general purpose "shrink-wrapped" PC tools such as databases, but it is applicable to developments using these tools.

The agreements discussed in this paper also involve issues relating to potential licensing of the applications themselves and any environmental software required to run them (e.g. database management software, programming code generators, browsers etc). Although we touch on these issues in this paper, these are dealt with in more depth in the "Software Licensing Guidelines" in this series.

Due to the convergence and inter-linking of computing and telecommunications, this guideline series applies equally to these technologies (collectively referred to as Information Technology or "IT" below). For example, PABXs are increasingly computerlike software-controlled devices integrating voice with data at a userís workstation. A user will take voice calls via a headset linked to the PC. The voice call may initiate the retrieval and display of data relating to the caller from a sales database. Voice and data are no longer separate parts of a system.

A sample agreement that may be used as the basis for a contract is included with this guideline. This sample agreement is for the development of software, although the principles also relate to enhancements of software packages.

As with the previous documents it must be noted that each agreement must be tailored to meet the requirements of a particular acquisition. This paper seeks to provide practical guidance and advice on general principles but it is expected that organisations undertaking contract negotiation would also seek legal advice as required.
Download Attached Document(s): l24062-07.pdf (134.1 Kb)