Classification
Description
Audit Rights
Client's right to audit the service provider's operations, facilities, records, or compliance documentation. Includes notice period, frequency limits, and scope of access. Compliance signals: audit access denied or delayed beyond the contracted response window; audit frequency exceeded without a documented quality concern justifying an unannounced visit.
Capacity and Space Guarantee
Commits the service provider to a minimum number of pallet positions, storage area, or throughput capacity, including seasonal or peak-period uplift provisions and advance notice requirements. Compliance signals: storage invoices billing above guaranteed capacity without a documented uplift request; peak periods triggered without the required advance notice.
Confidentiality
Obligations to protect non-public information disclosed by either party and restrictions on disclosure to third parties. Compliance signals: sub-contractors or third parties given access to confidential data without the required consent; confidentiality obligations referenced in operational documents that exceed or contradict the contracted scope.
Corrective Action and Root Cause
Obligations triggered by sustained KPI failure: root cause analysis, corrective action plan, submission timelines, and remediation commitments. Compliance signals: KPI failures persisting beyond the contracted trigger threshold without a documented corrective action plan; plans submitted outside the contracted deadline.
Customs and Border Compliance
Obligations around customs declarations, EORI numbers, import/export entries, transit documents, phytosanitary and SPS inspections, rules of origin, and allocation of responsibility and cost for border delays. Compliance signals: customs delays or fines attributable to documentation deficiencies; costs passed through without the contracted administration uplift; EORI numbers missing or mismatched on declarations.
Definitions
Establishes the meaning of capitalised or technical terms used throughout the agreement (e.g. Goods, WMS, KPI, Cold Chain Shipment, CMR Convention). Compliance signals: operational documents using defined terms in a way inconsistent with the contracted definition, or terms used without definition that should be clarified.
Force Majeure
Defines events excusing performance, notification obligations, duration thresholds, and termination rights if the event persists. Compliance signals: force majeure invoked without notification within the contracted window; events claimed that do not meet the contracted definition; force majeure used to avoid liability in situations where an alternative remedy exists.
Governance and Reporting
Operational governance mechanisms: Quarterly Business Reviews, monthly operations reports, KPI dashboards, dedicated account manager obligations, and escalation paths. Compliance signals: QBRs not held within the contracted frequency; monthly reports not delivered within the contracted deadline; account manager not assigned within the contracted onboarding period.
Governing Law and Dispute Resolution
Choice of governing law, jurisdiction, escalation to senior management before formal proceedings, and applicable arbitration rules. Compliance signals: dispute notices referencing forums or legal frameworks inconsistent with the contract; escalation steps bypassed before formal proceedings are initiated.
Insurance Requirements
Mandatory insurance coverages: cargo or warehouse keepers' liability, public liability, and employer's liability. Minimum coverage amounts and evidence of insurance obligations. Compliance signals: insurance certificates not provided within the contracted timeframe; coverage amounts below contracted minimums; policies lapsed or not renewed during the contract term.
KPI Targets
Defines quantitative performance targets the service provider must achieve, including on-time despatch, inventory accuracy, order fill rate, damage rate, inbound processing time, and carrier on-time delivery. Includes measurement period and methodology. Compliance signals: operational reports showing KPI performance below contracted thresholds; measurement methodology applied differently from the contracted definition.
Liability Limits and Exclusions
Caps on carrier or service provider liability for loss or damage to goods under applicable conventions (Montreal, Hague-Visby, CMR) or contractual limits, and exclusions for indirect or consequential loss. Compliance signals: claims submitted or settled at amounts exceeding the contracted liability cap; exclusion clauses cited in claim rejections that are not present in the contract.
Parties and Contract Identity
Identifies the contracting parties (full legal names, registration numbers, VAT numbers, addresses), contract reference number, agreement date, and execution signatures. Compliance signals: party names or registration numbers on invoices, purchase orders, or shipping documents that do not match the contracted entities; contracts missing valid signatures or execution dates.
Payment Terms and Invoicing
Invoice issuance schedule, payment due date, disputed invoice process, and undisputed portion payment obligations. Compliance signals: invoices issued outside the contracted billing cycle; payment made beyond the contracted due date; disputed amounts withheld in full when only a portion is in dispute; invoices referencing incorrect party names, VAT numbers, or contract references.
Price Escalation and Rate Review
Governs annual or periodic rate adjustments: index linkage (CPI, fuel indices), notice period for proposed increases, cap on increase percentage, and effective date of revised rates. Compliance signals: rate increases applied without the contracted notice period; increases exceeding the contracted index cap; escalation effective dates inconsistent with the review cycle.
Pricing and Rate Card
Sets out the fee schedule: storage rates, handling charges, freight rates, fixed management fees, and the basis for spot versus contracted rates. Compliance signals: invoiced rates that differ from the contracted rate card without a documented escalation or surcharge trigger; services billed that are not listed in the rate card.
Scope of Services
Describes the operational services to be delivered: inbound receipt, storage, pick/pack/despatch, outbound distribution, returns processing, customs brokerage, freight booking, or carrier management. Compliance signals: purchase orders or service requests referencing activities outside contracted scope; scope amendments not formally documented.
Service Credits and Penalties
Specifies financial remedies triggered by KPI failure: credit calculation basis, applicable thresholds, cap amounts, and exclusions. Compliance signals: credit invoices or deductions applied at rates inconsistent with the contract; credits claimed for KPI failures that fall within contracted tolerance; cap limits exceeded in a single billing period.
Surcharges and Additional Costs
Defines variable surcharges applied on top of base rates: fuel surcharge, security surcharge, port or airport handling, customs disbursements, inspection fees, and pass-through cost mechanisms. Compliance signals: surcharges applied at rates not published or agreed in writing; pass-through costs billed with markups exceeding the contracted administration percentage.
Technology and Systems Integration
Provisions governing WMS, ERP, or TMS integration; API and EDI connectivity standards; implementation timelines; and customer portal access. Compliance signals: integration go-live dates missed beyond the contracted deadline; data exchange formats used that differ from the contracted standard; portal access not provisioned within the agreed timeframe.