Legal Tip: Avoid Auto-Renewal of Managed Service Contracts With This Language

SASE Secure Access Service Edge

If you haven’t experienced it once in your career, you are lucky.  Carriers and other service providers often include automatic renewal language in their contracts for managed network services (MNS) in general and managed SD-WAN services.  After a three-year term, if you do not give notice of termination at least 30 (or 60) days before the end of your term, the contract will automatically renew for the same original term, such as three years, if that was the original term.  This language has stood up in court.

Another carrier trick is to not mention auto-renewal in the paper contract that you sign.  Instead, the contract references “terms and conditions at shall be incorporated into this agreement”, with the auto-renewal language displayed at this website.  Many customers do not notice this. Or, since it is not in the written agreement, in the future, it is assumed that the agreement does not auto-renew.  Wrong!

Protect yourself! Insist on including this language in your carrier contracts under the Term and Renewal section:

Upon the expiration of the Initial Term, this Agreement shall be renewed automatically for successive Renewal Terms equivalent in duration of one (1) month unless terminated by either Party by providing one (1) month written notice of its intention not to renew this Agreement prior to the end of the Initial Term or any current Renewal Term.

This language will protect you and your company from unexpected surprises several years down the road.

Share this post