The service contract is a common type of civil contract, commonly used in today’s society. To ensure the contract performance is in accordance with the law and limit possible disputes, it is extremely necessary to understand the provisions of the law on service contracts. In this article, TNTP will analyze some basic contents about this type of contract.

I. What is a service contract?

According to the provisions of Article 513 of the Civil Code 2015, a service contract is an agreement between the parties whereby the service provider performs work for the client, and the client must pay a fee for that work to the service provider.

On the other hand, according to Clause 9, Article 3 of the Commercial Law 2005, service provision is a commercial activity, whereby one party (hereinafter referred to as service provider) is obliged to perform services for another party and receive payment; the service user (hereinafter referred to as the client) is obliged to pay a fee for the service provider and use the service as agreed.

Thus, it can be seen that a service contract is a type of contract whose object is work. In a service contract, the service provider must perform work for the benefit of the client, and the client is obliged to pay the service fee to the service provider based on the contents of provisions in the contract or as prescribed by law.

II. Legal features 

First, a service contract is a bilateral contract, where the two parties to the contract must perform obligations towards each other. Accordingly, the service provider performs an agreed-upon work for the benefit of the client. The client is obligated to pay the service provider.

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Second, a service contract is a compensatory contract. Accordingly, the client must pay the service fee to the service provider after the service provider has completed the work. In case the service provided is not as agreed upon or the work is not completed on time, the client has the right to reduce the service fee and claim compensation for damage.

Third, as mentioned above, the object of the service contract is the work that the service provider must perform for the benefit of the client. The work considered as the object in the service contract must be work that can be feasibly executed. Additionally, the work must not be prohibited by law, contrary to social ethics, and must be carried out by entities with the authority to provide the service.

III. The form of the service contract

According to Article 74 of the 2005 Commercial Law, a service contract can be expressed verbally, in writing, or established by actual acts. For types of service contracts that are required by law to be in writing, the parties to the contract must adhere to those regulations. For example, according to the provisions in Article 90 and Article 124 of the Commercial Law 2005, promotional service contracts and contracts for displaying and introducing goods or services must be made in writing or in another form of equivalent value. The legally equivalent forms here include telegraph, telex, fax, data messages, and other forms as prescribed by the law (Clause 15, Article 3 of the Commercial Law 2005), or in other words, the contract is concluded in the form of an electronic contract (Article 33 of the Law on Electronic Transactions 2005).

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IV. Basic contents 

A service contract may include the following basic terms:

+ The subject of the contract;
+ Rights and obligations of the client;
+ Rights and obligations of the service provider;
+ Payment for services;
+ Force majeure;
+ Penalties for violations and compensation for damage;
+ Unilaterally terminate the contract performance;
+ Continuation of the service contract;
+ Dispute resolution;
+ Term of effect.

Above is the content of the article “Service Contracts: Basic Content You Need to Know” that TNTP sent to readers. If you have any questions, please contact TNTP for the best support.

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