Data Use Agreement: Key Components, Common Issues, Review

What is a Data Use Agreement?

A data use agreement is a legal contract signed by a data provider and client. It specifies how data can be used. Since mishandling sensitive data can result in breaches or other issues, a data use agreement needs to be clear with protection measures.

There are various instances when data user agreements are essential, such as if a hospital is sharing patient data with a research company or a software company is sharing data with vendors.

If you need a data use agreement, read the rest of this article to explore key terms in this type of contract, the most common issues that appear in them, and how a lawyer can help you review or negotiate a data use agreement.

What are Key Components in a Data Use Agreement?

A data use agreement usually contains the following information.

• Data type. The agreement specifies what data will be used and who is allowed to access it.
• Use. The goal for using the data must be defined so that parties know how they’re allowed to use it. This section of the agreement should also specify what data usage is prohibited.
• Termination obligations. When the agreement is terminated, the data will have to be stored, returned, or destroyed. These requirements must be clear so that there is no confusion.
• Liability. If something goes wrong, such as there’s a data breach, this section of the agreement must specify who will take legal responsibility.
• Data protection. There should be measures in place to ensure that data is protected, such as message encryption and secure storage.
• Confidentiality. This specifies how the recipient is allowed to share the data so that it remains confidential and protected.
• Ownership. Who owns the data must be defined in the agreement to prevent disputes.

What are Common Red Flags in Data Use Agreements?

The most reported issues that are noted in data use agreements include the following:

Broad Uses

If the contract usage isn’t clear and specific, this can lead to violations. Prohibited activities must also be clearly defined.

Lack of Ownership

A common issue in data use agreements is little or no information about who owns the data. This can result in future disputes while also hampering the data owner when pursuing damages for breaches.

Unreasonable Liability

If liability or indemnification isn’t capped, it can result in potential financial losses from one party taking on too much responsibility.

Third Party Usage

If the agreement doesn’t limit or restrict the sharing of data with third parties or subcontractors, it can lead to legal or privacy issues.

Low Security Standards

The recipient should ensure they upkeep security standards. If there’s no obligation of this mentioned in the agreement, it can result in sensitive data exposure.

How Can You Review a Data Use Agreement?

If you have a data use agreement, it’s in your best interests to read and review it closely so you don’t agree to all its terms right away. Here are some tips for a thorough review.

Confirm Usage

The number one thing to do when reviewing a data use agreement is to confirm exactly what you’re allowed to do with the data. Perhaps this could be conducting research or training AI. Whatever the case, you don’t want any uncertainty that can cause problems.

Flag Vague Language

Any vague or misleading language can result in hidden risks and cause legal issues, so you want to make a note of it while reading the contract. Discuss and clarify them with the other party.

Check Privacy Compliance

You want to check that the agreement is clear on how the data will be legally handled and stored. It should mention all relevant laws regarding privacy.

Know Your Duties

It’s important to read through the entire agreement for information about what is your responsibility. This includes post-termination duties, such as how to handle the data when the contract ends.

Understand Audit Rights

If the provider is allowed to audit your processes, you want to define the scope for what they can do and prevent any security risks. For example, you might want to limit the audit process to the specific data use, not allow access to your entire infrastructure.

Get a Legal Review

It can be challenging to know how to review a data use agreement without a legal background. Hiring a qualified lawyer to help you thoroughly review the contract has various benefits.

A lawyer will identify any risks, protect your rights, and explain your duties so nothing is left to chance.

On ContractsCounsel, one of the biggest online legal marketplaces where you can connect with more than 1,000 vetted, experienced lawyers, you can request a legal review of your data use agreement. Here are the steps to follow:

1. Go to the ContractsCounsel marketplace.

2. Post your request for a legal review. It’s free.

3. Wait for lawyer bids. You’ll receive multiple bids from lawyers on the platform who will review your contract for a flat fee.

4. Review the lawyers' profiles. Before selecting the best lawyer for your requirements, view information provided on the platform. This includes the lawyers’ locations, their years of experience, their field of expertise, and client ratings for previous projects completed on the platform.

5. After reviewing the lawyers’ profiles, hire the best lawyer for your purposes.

Do You Need to Hire a Lawyer for a Data Use Agreement?

Besides reviewing your data use agreement, a lawyer can help you in other ways. This includes:

• Negotiating with the other party on your behalf. They are skilled at knowing how to push back for positive changes.
• Rewriting clause in the agreement. A lawyer will put everything negotiated in writing to ensure the contract is clear and specific.
• Structuring your deal. This ensures that it is aligned with your business goals.
• Aligning your agreement with other business contracts. This prevents conflict between important documents.

Why You Should Choose a Lawyer from ContractsCounsel

Hiring a lawyer for assistance with a data use agreement is easy on ContractsCounsel. You’ll get access to professional lawyers who know how to help you. Here are some benefits of hiring one:

• All lawyers on the platform are vetted.
• The platform offers fair, competitive pricing.
• Access lawyer profiles and choose the best one for your legal needs without having to find lawyers via traditional law firms.