Legal Issues Cloud Service Agreements Should Address
Sep 16, 2026
An attorney specializing in IT and software transactions, Franciscus Diaba works at Johnson & Johnson, specializing in technology, commercial and intellectual property. With a Juris Doctor from Franklin Pierce School of Law, University of New Hampshire, Franciscus Ladejola Diaba spent his early career as an Engineer. Today, Franciscus Diaba specializes in negotiating cloud services agreements and other commercial agreements.
As companies increasingly shift to cloud platforms, cloud service agreements should be well drafted to ensure that the terms are clear. One major legal issue companies should consider when negotiating cloud service agreements is early termination fees. This fee is in all contracts, and its purpose is to protect the cloud provider. Before signing the contract, company legal representatives should ensure penalties are reasonable or null and void in the event service level agreements are not adhered to. It is important to negotiate and avoid hefty penalties in the event a customer wishes to move to another provider.