Reversibility clause

An exit clause (clause de réversibilité) is the stipulation of an IT contract that organises the end of the relationship between the customer and the provider, allowing the customer to take the service back in-house or to entrust it to a new provider without business interruption or loss of data. It appears in outsourcing, hosting, SaaS et de third-party application maintenanceagreements. The exit clause is the counterpart of the dependency created by outsourcing.

The content of the exit clause

First, the object of the exit: data, configurations, documentation, specific developments, transferable licences, operating procedures. Next, the terms: exit plan kept up to date during the contract, open and documented return formats, time limit, assistance from the provider to the new provider, recovery tests. Then the cost: exit is often invoiced according to a scale set in advance, which avoids negotiating from a position of weakness. Finally, closure: certification of the deletion of data at the provider’s, in compliance with personal data obligations.

The legal issues

Without an exit clause, the customer depends on the goodwill of the outgoing provider, which may rely on the absence of any obligation or charge a high price for assistance. The data belong to the customer, but extracting them in a usable format requires technical cooperation. For personal data, the General Data Protection Regulation requires the processor to return or delete them at the end of the service, at the controller’s choice. The clause also settles the fate of specific developments and of the licences needed to continue operations. The texts can be consulted on Légifrance.

Key points

In practice, the exit clause is negotiated at signing, never at termination. It must be tested periodically and coordinated with the service levels and with the protection of trade secrets. The firm drafts these clauses and acts in end-of-contract disputes, as presented on the page contracts.