Top 12 Agreements and Contracts for an E-commerce startup

E-commerce laws and regulations in Indian startup ecosystem are still evolving, but the general laws like – Company Law, IP Law etc., are applicable to these E-commerce businesses as well. In this blog one such secretarial compliance matter which is governed by Contract, Act is what we will be looking at- The top 12 Agreements and Contracts for an E-commerce startup.  Remember, disputes and differences are bound to occur in an online-commercial environment too. Contracts and norms are something pivotal that keeps your disputes and legal woes at bay.

A contract or an Agreement creates and defines obligations between two or more parties and is enforceable by law.  Contracts contain a proposal made by either of the parties to do or abstain from doing a particular action. Most of the contracts templates are available for free on the world wide web, but the unfortunate fact is entrepreneurs have little to no knowledge on validating a contract,  as in, if the contract is actually enforceable under law or not.  We at Wazzeer strongly believe contracts and Agreements are not something that can be taken as a toss but has to drafted with care and intelligence.  In order to make some of your lives simpler, in case you want to validate a contract by yourself, these are the essential elements a valid contract must consist:

  • Proposal and Acceptance.
  • Intention to create legal relationship
  • Lawful Consideration
  • Competent Parties
  • Free Consent
  • Legal Object
  • Not expressly declared void by law.
  • Certainty and possibility of performance
  • Compliance with legal formalities

Moving on, let’s look at the Top 12 Contracts and Agreements that are essential for an E-commerce startup:

  1. Founder’s Agreement: Apart from outlining the roles and responsibilities of the founding members of a company, it lets you know about the equity vested in them, the ownership of intellectual property created by them etc. It covers various aspects of the venture that the founders are about to undertake, even the consequences of their departure or death. 
  2. Website terms & Policies: Most users ignore the terms of service agreement and privacy policy prominently displayed on any website, but all entrepreneurs know their importance. It states that any information which is being gathered by any website will not be disclosed to the third party without any permission or legal action. According to the Information Technology Rule, 2011 in India there is a corporate body to provide a privacy policy for handling of or dealing with personal information, making the privacy policy a must-have for websites. [Disclaimer: A disclaimer is a statement/notice informing the user of any product or service of the possible consequences of the same. The law mandates the display of a disclaimer in certain cases, such as where there is an inherent risk of harm to one’s health] but used commonly in all product and service literature.  It is used in situations which involve an element of risk or uncertainty.
  3. Memorandum of Understanding (MOU): A Memorandum of Understanding is a document in which two or more parties declare that they agree on a common course of action or business. It is the first stage of the making of a contract. To be legally operative, a MoU must: 
  • identify the contracting parties
  • spell out the subject matter of the agreement and its objectives                            
  • summarize the essential terms and must be signed by the contracting parties
  1. Vendor Agreement: It is a comprehensive agreement covering various aspects of the vendor such as the quality of goods supplied or service provided, duration of the contract, terms, and mode of payment. This comes in handy when there are several sellers out in the picture.
  2. Non-solicitation Agreement: This contract is useful where an employee agrees not to solicit a company’s clients or customers, for his or her own benefit or for the benefit of a competitor, after leaving the company. It may also include not provoking other employees to leave when he/she quits or otherwise moves on.
  3. Joint Venture Agreement: This agreement is entered into by a group of persons or companies to do business together or to collaborate on a particular project without losing their individual legal identities. This is legally-binding in areas of profit sharing and operations. Before entering into this, you are supposed to sign the MoU along with the parties.
  4. Non-Disclosure Agreement: NDA is a legal contract stating that certain information is confidential, and the extent to which its disclosure is restricted to third parties. It can be entered into with a person or organization. Confidential information includes trade secrets, business plans, business methods and strategies, drawings, charts and more. Software programs and code are also confidential information. 
  5. Non-compete Agreement: A contract between two parties, where one party agrees not to compete with the other for a period of time. It lessens the possibility that knowledge gained by an employee or business partner will be used in the future to compete against them. In return, for not competing, the party is paid a fee. This agreement outlines the duration of the agreement, any geographical limitations, and what subjects or markets it covers.
  6. Contract of sale: This contract binds the seller and buyer on their duties – the duty of the seller to deliver the goods and of the buyer to accept and pay for them in accordance with the terms of the contract of sale. This contract cover clauses like: Rules regarding delivery.
  7. Return Policy: This Contract binds the buyer to follow a set of rules and guidelines to qualify a good for a return, as well the rules the buyer has to abide by when the return of product circumstance comes up.
  8. Master Service Agreement: This Agreement permits the buyer and seller to quickly negotiate future transactions or agreements because they can rely on the terms of the master agreement, so that the same terms need not be repetitively negotiated, and to negotiate only the deal-specific terms.
  9. Service-level agreement (SLA): Agreement that guarantees buyer that Particular aspects of the service – quality, availability, responsibilities – are agreed between the seller and the buyer.


We at Wazzeer are fully equipped to provide you all the required assistance to run a fully compliant E-commerce startup in India, feel free to contact us. We are just a click away ->”Get your Wazzeer” 🙂