Inter group company consulting agreement
This inters group company consultancy contract is for use by a group of companies wishing lawfully to allocate the cost of consultancy work to the appropriate group member. It can be used to formalise an existing arrangement, allocate expenses where they should fall, or to separate out the affairs of a subsidiary in preparation for its sale or the introduction of a third party shareholder. The nature of the consultancy work is not material.
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- Guidance notes included
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About this consultancy contract
This document is suitable for any organisation in any industry sector. It is drawn for use between members of the same company group or any other closely associated parties. The work is described in an attached schedule. The purpose of the agreement is to clarify the rights of the parties against each other.
The reason to use this contract may be:
- to allocate expense where most advantageous to do so;
- to separate out the affairs of one particular subsidiary so as to prepare it for sale or closure;
- to tidy up a muddled situation between subsidiaries;
- to clarify inter-company rights before a sales of shares or introduction of a new lender.
This contract is drawn with a view to fairness between two equal parties. If you wish to prefer the interest of one party, you should use Consultant contract: corporate; full or Consultancy contract: client appoints.
This consultancy contract contains broadly the same provisions you would expect to find in any commercial consultancy document. There are no implied “friendly terms” on account of the parties being associated.
This is an “umbrella” contract, set up for the possibility of future assignments under the same terms. That way, if you want more work from the same consultant, all you have to do is define it and refer to this agreement. Even if you expect never to re-employ, you do not have to delete anything on that account.
This contract assumes that the consultant may have deep involvement in your secrets and technology. This can be applied to any special knowledge.
There are options in several areas, notably contract summary, payment systems and working arrangements.
- Ease of use (as always with Net Lawman documents)
- Thorough coverage of legal areas
- Practical, alternative business provisions
- No requirement for you be your own lawyer
The law in this consultant’s agreement
There is little statute law in this consultancy agreement. It depends on basic contract law and tort. However, the structure and the contents of the agreement reflect the latest thinking on what is needed to protect a business from theft of its intellectual property.
Alternatives to this consultant’s agreement
Net Lawman publishes three types of consultancy contract:
- for a corporate consultancy to offer to its client
- for a single consultant working alone or with colleagues or sub-contractors
- for the client of a consultant to offer to a consultant, to protect his own interest.
Each of these three is available in three versions:
- for IT consultants;
- for HR consultants;
- and for any other.
The IT and HR versions contain more provisions relating to aspects of IT and HR, but the legal framework is the same in all.
You can see the full selection at Consultancy agreements.
Contents of this agreement
- Definitions and interpretation
- Preliminary legal matters
- Consultant to avoid conflicts of interest
- Consultant's obligations
- Consultant’s fees and expenses
- Work management procedure
- Option for use of sub-contractors by consultant
- No competition
- Inventions and new intellectual property
- Duration and termination
- Mutual indemnities
- Other legal provisions
- Miscellaneous matters
Over 2,000 words of helpful and informative drafting notes.
This document was written by a solicitor for Net Lawman. It complies with current South Africa law.
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