Freedom of Contract and Its Limits
The terms and conditions attached to SaaS services are governed, first of all, by the contract law of the Civil Code. Under Article 319 of the Code, subjects of private law may freely conclude contracts within the limits of the law and determine their content; contracts not provided for by law but not contrary to it may also be concluded. An exception arises where the validity of a contract depends on state permission, which must be regulated by a separate law. The same article provides that where one party holds a dominant position on the market, it bears an obligation to conclude contracts and may not groundlessly offer unequal terms to its counterparty. It is also important that persons who acquire or use goods and services for non-commercial purposes or to satisfy vital needs may not be unreasonably refused a contract where the other party acts within its entrepreneurial activity — a balance that protects SaaS consumers as well.
Essential Terms and Agreement
Under Article 327 of the Code, a contract is considered concluded where the parties have reached agreement on all its essential terms in the form envisaged for that purpose. Essential terms are those on which agreement must be reached at the request of either party, or which are deemed such by law. A contract may also give rise to an obligation to conclude a future contract, and the form envisaged for the contract extends to the preliminary contract as well. In practice this means that the so-called terms and conditions of a SaaS platform count as a concluded agreement only where the consumer actually consented to its essential provisions.
Incorporation of Standard Terms into the Contract
Particularly important for SaaS contracts is Article 343 of the Code: standard terms become a constituent part of the contract concluded between the offeror and the other party only where the offeror makes a visible notice at the place of conclusion referring to those terms, and the other party has the opportunity to familiarize itself with their content and, if it agrees, to accept them. Article 344 then protects the consumer from surprises: those standard clauses which, by their form, are so unusual that the other party could not have reckoned with them do not become part of the contract. Such clauses remain legally excluded regardless of whether the consumer was formally regarded as having consented.
Interpretation of Ambiguity in the Consumer's Favour
Article 345 of the Code establishes the rule for interpreting ambiguous texts: where the text of standard terms is unclear, it is interpreted in favour of the other party — the party to whom the standard terms were offered. This rule is especially relevant in SaaS contracts, where technical terminology and sheer length often prevent consumers from grasping the real meaning of a clause. Where ambiguity exists, preference is given to the interpretation favourable to the consumer, which disciplines providers in how they draft their conditions.
Freedom of contract does not mean ignoring the parties' real bargaining power. The Code recognizes that on the digital services market the informational advantage is almost always on the provider's side, and it is for this reason that additional obligations are imposed on the provider. The category of essential terms practically determines what counts as a concluded agreement: where no agreement exists on such a term, the contract is not concluded, and a preliminary contract leads the parties to the final agreement in the prescribed form. Where the other party is itself an entrepreneur, standard terms become part of the contract if the necessary diligence in business relations required taking them into account. The ambiguity rule, in turn, pushes providers to draft terms that an ordinary consumer can actually understand — otherwise the risk of ambiguity falls on the provider itself.
Frequently Asked Questions about SaaS Terms
When do standard terms become part of the contract?
Only where the offeror visibly refers to them at the place of conclusion and the other party can review and accept their content.
What happens to unusual clauses?
Clauses so unusual in form that the other party could not have reckoned with them do not become part of the contract and remain without effect.
Can a provider refuse to conclude a contract?
A provider acting within its entrepreneurial activity may not groundlessly refuse a request made for personal use; and in a dominant position, concluding the contract is an obligation.
How is an ambiguous clause interpreted?
In favour of the other party — the one to whom the standard terms were offered — which protects the consumer's interest. The consumer benefits from this rule in every case of doubt.
How We Help on Legal.ge
Whether you need to assess a SaaS platform's terms and conditions or are already in a dispute with a provider, the Legal.ge team will help you analyse the contractual provisions, identify unusual or ambiguous clauses and prepare a position for negotiation or dispute.