Proposed Contractual Arrangements
Q: What are the proposed contractual arrangements?
Answer
The business model has back-to-back contractual arrangements between CBs, ABs, IAF Database LLC and QualityTrade. These agreements are summarised in as follows:
Agreement: Operation and Maintenance of the IAF Global Database of Accredited Certifications Parties: IAF Database LLC and QualityTrade Overview/Requirements: Key agreement for development and maintenance of IAF CertSearch including QualityTrade obligations, IAF Database LLC obligations, restriction over data use, data privacy, security and management, financial arrangements, Intellectual Property Rights termination, liability, indemnity, and insurance
Agreement: Data Management Agreement and Terms of Use Parties: IAF Database LLC and CBs or ABs Overview/Requirements: Obligations and liabilities for data uploading, security, management and liability, and ownership
Agreement: User Agreement Statement Parties: IAF Database LLC and users of IAF CertSearch Overview/Requirements: Standard terms and conditions for appropriate use of IAF CertSearch website. Standard privacy controls for users of IAF CertSearch website. Financial Terms and terms of usage of the paid-for Analytical Services and Verification Services
Q: What are the key features of these proposed agreements?
Answer
The key features of these back-to-back agreements include:
IAF, through its subsidiary IAF Database LLC, owns IAF CertSearch and the IPR relating to it (excluding the IPR for coding of IAF CertSearch).
All CB and certified entity data shall remain the property of CBs. There is no transfer of ownership of certified entity data.
No data is transferred outside the EU, the server is based in Frankfurt, Germany
All derivative aggregated and anonymised works created from CB and certified entity data, including anonymized analytics will be the property of IAF Database LLC.
IAF Database LLC accepts responsibilities and liability for management of IAF CertSearch and CB data
The DMC is central to governance of database and oversight of QualityTrade service provider, as indicated in the Governance Framework in the QualityTrade Service Agreement.
IAF will have full control over the data and IAF CertSearch through the Operation and Maintenance agreement
Back-to-back liability, indemnity, and insurance arrangements will be in place between CBs or ABs and IAF Database LLC and QualityTrade.
Q: Where is the funding model covered in the proposed agreements?
Answer
The Operation and Maintenance agreement describes the new User Pays Funding Model: based on analytic and verification services. Revenue from these services will be shared with QualityTrade to fund hosting and maintenance of IAF Certsearch but the IAF Database LLC will remain a not-for-profit enterprise focused on the promotion of accredited certification.
Q: How will future developments be covered in the proposed agreements?
Answer
Future development of IAF CertSearch will be directed by the DMC and will be funded in accordance with the IAF Database LLC and QualityTrade contract (Operation and Maintenance agreement).
Q: How can the proposed agreement with Quality Trade be terminated?
Answer
The contract can only be terminated by QualityTrade if IAF Database LLC is in material breach of the contract. QualityTrade agrees to underwrite the cost of developing and maintaining IAF CertSearch for a period of five years. This will be vital during the first twelve months as the costs of hosting and maintenance exceed revenue. If IAF Database LLC terminates the agreement with due cause, QualityTrade would grant IAF Database LLC a licence in perpetuity to use the coding in IAF CertSearch and transfer it to another IT Service Provider.
Q: How is IAF governance covered in the agreements?
Answer
Oversight of the agreements will be maintained by the DMC on behalf of the IAF Board. The DMC is representative of ABs, CBs and Users.
Q: How will IAF manage liability in the proposed agreements?
Answer
In its contracts with CBs and other users of the database, IAF Database LLC will include language limiting its liability. These limitations include a general exclusion of consequential and other speculative damages and an annual cap on liability. The proposed version of the data management agreement contemplates an annual cap equal to available insurance proceeds. IAF-DB will receive a contractual indemnity from QualityTrade which covers, among other things, failure to maintain information security standards. This indemnity will be backed up by minimum insurance requirements contractually imposed on the database developer/operator.
Last updated