What is AI Vendor Agreement Drafting?
An AI vendor agreement is a legal contract between a client, such as a company, and a third-party AI (artificial intelligence) provider. It’s required whenever a company makes use of AI in its tools, products, or processes.
This agreement usually contains terms such as how to navigate model training and output ownership. It must address specific risks you won’t find with standard vendor contracts.
This is why it’s important to establish clear and specific terms in your AI vendor agreement.
If you need to draft this agreement, read the rest of this article for key terms to include in your AI vendor contract, how to draft it professionally, and how a lawyer can ensure your final draft is legally sound.
What are Key Terms in an AI Vendor Agreement?
When drafting an AI vendor agreement, pay attention to including the following terms in it:
- Restrictions. Ensure the vendor can’t use your prompts or other data to train commercial AI models.
- Output ownership. Clearly define which party owns the data.
- Confidentiality. Include a clause that protects your company’s private and sensitive data, such as stating that it will be deleted after the agreement ends.
- Transparency. Provide information about advance notice the vendor must provide when amending or updating models.
- Compliance. Ensure that your agreement is compliant with all AI and privacy laws.
What are Tips for Drafting an AI Vendor Agreement?
Now that you’ve established key terms in your AI vendor agreement, elaborate on them with additional information. Here are some drafting tips.
Check AI Vendor Rights
Make sure that you’re not giving the vendor rights to use your company’s inputs for training purposes, unless you have provided written consent. All inputs should be deleted when the contract comes to an end to prevent misuse.
Clarify Ownership
Whether your agreement covers marketing content or software modules, you want to ensure there’s clarity about who owns it. Avoid stating that the vendor can reuse or re-license the outputs as they wish as this can put you at risk.
Refer to Other Agreements
You must make sure that what’s in your other agreements, such as client agreements, doesn’t contradict information in your AI vendor contract, or vice versa. Before drafting your AI vendor agreement, make sure you’ve considered all client obligations and verified you will retain all IP (intellectual property) rights that your clients would expect from you to prevent issues.
Check Liability
Make sure you’ve drafted solid liability clauses that cap or restrict your responsibility for damages. This will prevent you from facing penalties or legal disputes.
Ensure Human Review
Since AI can and does make mistakes, you want to ensure human fact-checking of your agreement before you sign it. It’s worth getting the document drafted or reviewed by a professional lawyer who will reduce your risks.
How Does a Lawyer Help You with AI Vendor Agreement Drafting?
A lawyer can help you in various ways when drafting an AI vendor agreement. This includes the following:
- Defining the services scope. A lawyer will explain all the AI software, tools, and other deliverables that the vendor commits to providing.
- Protecting your personal interests. They’ll draft clear rules for protecting your data and privacy. This includes how to collect, process, store, and share confidential data.
- Addressing intellectual property. They’ll specify ownership and permitted uses for all AI outputs and other IP to prevent disputes.
- Allocating fair liability. They’ll consider the situation and determine which party is responsible for inaccurate AI outputs or other potential losses.
- Setting clear and solid security requirements. They’ll include protective clauses for access controls, cybersecurity, and data protection.
- Aligning the agreement with all laws. They’ll ensure that the agreement is aligned with applicable laws and regulations, such as current AI and privacy rules.
- Identifying performance standards. Uptime requirements and support must be included in the agreement so that high-quality standards are understood and met.
- Planning ahead. A lawyer considers future risks or situations to protect your interests. An example includes setting clear and fair termination rights and transition assistance after the contract ends.
- Reviewing an AI vendor agreement. If you’ve already drafted the contract, you can hire a lawyer to give it a thorough review. This will put you at ease that all its terms are clear, balanced, and legally sound.
Where to Find a Lawyer for AI Vendor Agreement Drafting
If you’d like to ask a lawyer to draft your AI vendor agreement, you might wonder where to locate one who’s experienced and professional. Using an online legal platform makes it easier to connect with a lawyer who can assist you by providing a professionally-drafted AI vendor agreement.
ContractsCounsel is one of the largest online legal marketplaces that connects you to not just one but a curated network of lawyers who have been vetted on the platform. All lawyers are experienced and reliable.
Without leaving your home, you can request that a lawyer on the platform drafts your contract. Here are the steps to follow:
- On your device, go to the ContractsCounsel marketplace.
- Choose ‘One-time project’ and ‘Create or update contract.’ Alternatively, if you want a lawyer to review your agreement, you’ll select ‘Contract review.’
- Post your request or project so you can match with suitable lawyers on the platform.
- Wait for bids. You’ll receive multiple bids from lawyers directly on the platform who are ready to help you.
- Review the platform’s lawyer data. This includes the lawyers’ location, credentials, field of expertise, years of experience, and client ratings they’ve achieved for previous projects completed on ContractsCounsel.
- Select a lawyer who meets your requirements. Hire them to draft your AI vendor agreement for a flat fee.
