Every Contract a B2B Service Business Needs in the UK (2025)
Last updated: February 2025
Legal Requirements for a B2B Service Business
UK B2B service businesses are primarily governed by common law contract principles and the Supply of Goods and Services Act 1982 (implying reasonable care and skill). Unlike B2C, there is more freedom to limit liability under the Unfair Contract Terms Act 1977, though exclusions must still be reasonable. UK GDPR applies when processing client data. The Late Payment of Commercial Debts Act 1998 provides statutory interest rights. The Bribery Act 2010 requires anti-bribery procedures for businesses of all sizes.
Essential Contracts
Framework contract covering the overarching commercial terms, liability caps, IP ownership, confidentiality, and termination provisions for all engagements
Project-specific terms defining scope, deliverables, milestones, acceptance criteria, and pricing for individual engagements under the MSA
Essential for protecting confidential information exchanged during pre-sales discussions and service delivery
Required under UK GDPR when accessing or processing client personal data as part of service delivery
Recommended Contracts
Quantifiable performance metrics, uptime commitments, and remedies for service failures — increasingly expected by enterprise clients
Required under the Bribery Act 2010 — must have adequate procedures and contractual anti-bribery commitments with clients and suppliers
Governs relationships with subcontractors who deliver services to your clients, including back-to-back liability provisions
Common Legal Risks for a B2B Service Business
- Uncapped liability exposure from client claims without properly drafted limitation clauses
- Scope disputes on large engagements without detailed statements of work and change control procedures
- Late payment from large corporate clients extending payment terms beyond agreed periods
- Bribery Act 2010 prosecution for failing to have adequate anti-corruption procedures
- Data breach liability when processing client data without a proper DPA in place
Industry-Specific Notes
B2B service businesses have more contractual freedom than B2C but must still comply with the reasonableness test under the Unfair Contract Terms Act 1977. The late payment statutory interest right (8% above base rate) applies automatically but can be varied by contract. Many B2B service businesses should consider joining relevant trade bodies for standard contract templates and dispute resolution services.
FAQ
How far can a B2B service business limit its liability in the UK?
B2B contracts have more freedom to limit liability than B2C, but the Unfair Contract Terms Act 1977 still applies. You can never exclude liability for death or personal injury caused by negligence. Other exclusions must pass a reasonableness test considering the parties' bargaining positions, whether the customer had a choice of suppliers, and whether the limitation was drawn to the customer's attention. Typical B2B caps limit liability to the fees paid in the preceding 12 months or the value of the relevant statement of work.
Should B2B service contracts include a change control procedure?
Absolutely. Scope changes are the single biggest source of disputes in B2B service engagements. A change control procedure should require all scope changes to be documented in a change request, signed by both parties, with agreed pricing and timeline impacts before work begins. Without this, you risk either doing unpaid work or damaging the client relationship by refusing ad hoc requests.
What anti-bribery obligations does a B2B service business have?
Under the Bribery Act 2010, all UK businesses face strict liability for failing to prevent bribery by associated persons (employees, agents, subcontractors). The only defence is having 'adequate procedures' to prevent bribery. This means having a written anti-bribery policy, risk assessments, due diligence on partners, training for staff, and contractual anti-bribery clauses with clients and suppliers. The penalties include unlimited fines and up to 10 years imprisonment for individuals.
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