Service contract
A contract under which one party provides defined services to another for an agreed fee.
Definition
A service contract sets out the services to be performed, the standard expected, pricing and the term, and is the backbone of most B2B service relationships. Dutch law classifies most such arrangements as an assignment (overeenkomst van opdracht), imposing a duty of care on the service provider. Well-drafted service contracts define deliverables, service levels, acceptance and liability allocation.
Example
A managed service provider signs a three-year service contract to monitor and support a client's IT infrastructure against fixed monthly fees and an SLA.
Why this is a business risk
Vaguely defined service scope is the single most common cause of disputes in service contracts: if deliverables and acceptance criteria are not precise, the provider and client will disagree on whether the obligation has been met. Long-running service contracts with no price adjustment mechanism expose the provider to margin erosion and the client to arbitrary unilateral increases. An overlooked automatic renewal can commit either side to a multi-year extension neither wants.
How to manage it
- Define the services in a separate, detailed scope-of-work schedule rather than in the body of the agreement, and include acceptance criteria for each deliverable.
- Include a change-control procedure so any scope change is documented, priced and agreed in writing before the work starts.
- Track renewal dates and any notice periods in a central system; three-year agreements are easy to forget.
- Agree on key performance indicators and reporting intervals so both sides have objective evidence of whether service levels are being met.
Legal references
Unless marked otherwise, references are to Dutch law (Burgerlijk Wetboek, the Dutch Civil Code); EU instruments such as the GDPR apply across the EU. This is general information, not legal advice. Other jurisdictions treat these concepts differently. Verify the current text and your situation with a qualified lawyer.
Frequently asked questions
Common questions about this term.