Wondering if your AI startup or company needs a terms and conditions agreement? There are a lot of reasons why you should have one.
A terms and conditions agreement outlines rules of use, dispute resolutions, and other expectations for consumers and website visitors, which is vital for AI companies.
Below, learn how to make a terms and conditions agreement for your AI company, why you need one, what goes into it, the laws that might impact it, and more.
- How Do You Create a Terms and Conditions for AI Startups and Companies?
- Does My AI Company Need a Terms and Conditions Agreement?
- What Laws Impact My AI Company’s Terms and Conditions Agreement?
- What Should Go Into My AI Startup or Company’s Terms and Conditions?
- Where Should I Display My AI Company’s Terms and Conditions Agreement?
- How Termly Helps AI Startups and Companies Make Terms and Conditions Agreements
How Do You Create a Terms and Conditions for AI Startups and Companies?
You can make a terms and conditions for your AI company by using a generator, a template, or writing one yourself.
Use a Terms and Conditions Generator
AI startups and companies can easily make this agreement by using a Terms and Conditions Generator like Termly’s.
Our legally backed generator asks basic questions about your AI company and creates a unique agreement for you based on your answers.
You can then easily embed it directly to your website and edit or change it as needed directly from the Termly dashboard.
It’s quick, easy, and trusted by millions.
Use a Template
You can also use a template to make one of these agreements for your AI company.
These are free to use resources and help jump start the process by having most of the formatting and basic language already completed for you.
However, they still take a lot of manual effort. For example, you’ll need to fill in blank sections of the template with accurate details about your AI company.
You can also add or remove clauses and sections as applicable.
Write it Yourself
Of course, you can always write your own terms and conditions agreement for your AI company, but this can take a very long time and is only recommended if you have a lot of legal knowledge and are familiar with these documents.
These are long documents that usually have a lot of technical and legal information within them, including disclosures and links to other relevant legal policies.
Because it takes so much time and effort, you might have a simpler time just using a template or paying for a generator, which can save you time and a lot of hassle.
How NOT To Create a Terms and Conditions for AI Startups
Now that you know how to make terms for your AI company, here’s what to avoid:
- Don’t copy someone else’s terms and conditions agreement. This is copyright infringement, and another company’s terms won’t even apply to your specific business. Doing this may leave you at a significant legal risk.
- Don’t add whatever you want as terms and expect it to hold up in court: You can’t just make up any rules you want for your website, add it into your terms, and think it’ll hold up in court. It must follow all applicable laws and meet specific conditions.
- Don’t rely only on AI/LLMs to make your terms: You own an AI company, which means you’re aware of how AI can hallucinate and cannot know specific legal details about your business unless you manually feed it the information via a prompt. This could take even more of your time, not saving you any.
Does My AI Company Need a Terms and Conditions Agreement?
Yes, your AI company or startup can most likely benefit from having a terms and conditions agreement posted somewhere on your website.
This document helps outline important details, rules, and expectations for consumers. It can also answer a lot of their common questions, which makes it a convenient and necessary policy to have available.
Terms and conditions agreements protect your business: having one just makes logical sense.
What Laws Impact My AI Company’s Terms and Conditions Agreement?
Several laws impact AI company or startup terms and conditions agreements.
Industry specific rules like the UE AI Act regulate AI companies heavily and apply to entities located all around the world (not just those in Europe).
You might also need to follow consumer protection laws outlines by groups like the FTC in the U.S., and many states have also introduced legislation impacting AI companies.
What Should Go Into My AI Startup or Company’s Terms and Conditions?
The table below explains different clauses you should consider adding to your AI company’s terms and conditions agreement.
| Clauses to Add | What To Include |
| A Proper Introduction Clause | Your AI company’s terms and conditions agreement needs a proper introduction clause naming who the agreement applies to and defining any necessary terms or phrases.
There should also be a clear table of contents available so consumers can see all details about what your policy entails. |
| AI Transparency Clause | New AI laws that are popping up around the world are requiring a level of transparency and honesty from AI companies and startups, so include this clause in your terms and conditions.
Explain what on your website or within your products is AI and make it clear to users when they’re interacting with an AI rather than a human, or when they’re reading or viewing something created by an AI. |
| Intellectual Property Clause | Terms and ocnditions agreements are common places for businesses to outline intellectual property rights and other ownership details.
Your AI company should also include these details in your agreement. |
| Digital Millennium Copyright Act Notice and Policy | Many terms and conditions agreements include a DMCA notice, which can help protect your AI company from user-uploaded copyright infringement issues.
If your users are allowed to upload anything, consider having this clause in your final terms. |
| User Contribution Clause | If your AI startup or company enables users to contribute to your platform or service, add this clause to your terms and conditions so you can outline rules and expectations.
This allows you to say who owns the contributions, what the rules are, and establish other essential details. |
| Third Party Links Clause | It’s important to have a clause in your terms and conditions that explains to users that you might link out to third party sources and are not responsible for what appears on those pages.
This removes liabilities from your plate if those links suddenly change and contain information that is not in line with your brand or the law. |
| User Registration Clause | If users are allowed to register for an account on your AI startup website, add a clause to your terms explaining how they can do so, the rules for signing up, and other applicable details.
This helps answer common questions users have about who can sign up and how to do so. |
| Acceptable Uses Clause | It’s essential to have an acceptable use clause in your terms explaining to people the proper ways they are allowed to use your AI services.
This allows you to set the foundational rules for how your product or services are meant to be used by consumers. |
| Prohibited Activities & Restrictions Clause | You also should outline prohibited uses or restrictions in a clause in your privacy policy.
This can help protect you against abusive users and sets clear expectations. |
| Suspension & Termination Clause | You should explain in a clause in your terms that you reserve the right to suspend or terminate accounts using your AI platform.
Say the reasons why you might suspend or terminate an account and what the process formally looks like. This helps protect you and keeps your consumers properly informed. |
| Site/AI Management & Support Clause | There should be a clause in your terms and conditions that explains to users that your site or AI platform might be down for regular support or maintenance purposes.
This removes liabilities from your plate and keeps users informed about possible outages or updates that could disturb their regular use of your AI platform. |
| Pricing & Payment Terms Clause | Adding a pricing and payments term clause to your terms and conditions agreement helps inform users about what payment methods you accept, which fields common questions and saves you time. |
| Limitation Of Liabilities | Most terms and conditions agreements feature a limits of liabilities clause.
This is a standard clause that says you remove responsibilities from your plate if a user misuses your AI product and suffers because of their own actions. |
| Governing & Applicable Laws Clause | Add a governing or applicable laws clause to your AI platform’s terms and conditions to communicate to users what regional laws apply to your business if a dispute occurs.
For example, state if you fall under U.S. state laws, or somewhere else in the world. |
| Dispute Resolutions & Indemnification Clause | You also need a dispute resolution clause in your terms and conditions, as this tells users how your AI startup or company formally handles disputes.
Consider consulting a lawyer for help with these details if needed. |
| Corrections & Inaccuracies Clause | Add a clause to your terms and conditions explaining that your website and your AI platform might have inaccuracies.
Be honest about the limitations. This clause can help remove liabilities from your plate if information on your website is wrong or outdated. |
| AI Startup/Company Contact Information | Finally, make sure your AI startup or company’s contact information is readily available in your terms and conditions agreement.
This ensures users can contact you if they have any questions or concerns. |
Where Should I Display My AI Company’s Terms and Conditions Agreement?
You should display your terms and conditions agreement in a few places, for example:
- The footer of your website: This is where users expect to find this agreement, so make sure to add a link here.
- Sign up or account creation pages: This is an opportunity to prompt them to read and check a checkbox to denote that they agree to your terms.
- Near online forms or newsletter/email sign-ups: This is another opportunity to get users to click a check box saying they’ve read and agreed to your terms.
- Wherever they interact with AI or AI created materials: This helps keep them informed transparently about when they’re interacting with AI, which is becoming a more common legal requirement.
How Termly Helps AI Startups and Companies Make Terms and Conditions Agreements
When it comes to making a terms and conditions agreement for your AI startup of business, look no further than Termly!
Our legally backed policy generators are easy to use, regularly updated, and already trusted by thousands of AI companies.
Plus, our amazing customer support team is always ready to help answer any questions you may have.
Sign up and see what all the hype is about today!
Written by Natasha Piirainen
Natasha Piirainen is a privacy writer with a Bachelor’s Degree in English and Philosophy from Wheaton College and over 10 years of professional experience in research-driven content development.
Read all posts by Natasha Piirainen
Reviewed by Masha Komnenic CIPP/E, CIPM, CIPT, FIP
Masha Komnenic is a legal counsel and Termly’s Director of Global Privacy, who received her law degree from Belgrade University. She specializes in implementing, monitoring, and auditing business compliance with privacy regulations (HIPAA, PIPEDA, ePrivacy Directive, GDPR, CCPA, POPIA, LGPD).
Read all posts reviewed by Masha Komnenic CIPP/E, CIPM, CIPT, FIP
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