Software has become an infrastructure for most businesses. As technology becomes central to commercial growth, legal and regulatory obligations governing this sector have become equally integral. We help tech companies navigate that intersection with practical, commercial and focused advice.
Technology sector is the backbone of India’s service exports, contributing over USD245 billion annually and employing over five million people. Complementing this exponential growth, the legal environment in which Indian B2B tech platforms, SaaS startups and IT/ITES companies operate has also evolved in the last decade. These companies presently operate at the intersection of IT law, data protection, tax, intellectual property, employment, foreign exchange, and sector-specific regulations applicable to the industries they serve. Moreover, this regulatory framework is not static – the laws governing how technology is owned, how software is taxed, how data is protected, how clients in regulated industries can be served, and how the technology workforce can be structured have all changed in ways that affect commercial decisions, not just compliance ones. The Digital Personal Data Protection Act, 2023, the Competition (Amendment) Act, 2023, the CERT-In Directions on cybersecurity incident reporting, and the continuing evolution of the Equalisation Levy and cross-border tax frameworks are each consequential for a technology business.
We advise technology clients at every stage – from a founding team negotiating its first enterprise contract, to an IT services company managing multi-jurisdictional client relationships and a SaaS business preparing for a funding round or a cross-border acquisition – our practice is built around the specific legal challenges of the technology sector.
Legal services for technology companies
Our technology practice offers end-to-end legal support across the commercial, regulatory, and transactional dimensions of a technology business. Some of the core services are:
Technology Contracts – drafting, review & negotiating
A well drafted technology contracts is critical to define what is being delivered, who owns the work product, who bears a liability if something goes wrong, how disputes are resolved and how the relationship ends. A contract that leaves any of these questions unanswered, leaves it open for interpretation often in favour of the party yielding leverage at the time of dispute.
We draft, review and negotiate the full range of technology agreements — Master Services Agreements, SaaS Subscription Agreements, Statements of Work, Service Level Agreements, Software Licence Agreements, API Licence Agreements, Maintenance and Support Agreements, Source Code Escrow Agreements, and Technology Transfer Agreements. Advising both vendors and clients, gives us a practical understanding of where the real commercial risk lies and where there is a room for negotiation.
For IT/ITES companies delivering services to overseas clients, we navigate the conflict between Indian and foreign governing law, understand the implications of GDPR Standard Contractual Clauses and adequacy decisions for data transfers, and structure limitation-of-liability provisions that are defensible in the jurisdictions where the clients operate.
Intellectual Property – protection, enforcement & commercialisation
For technology companies, IP is not just an asset – it is the heart of the business. The codes, data training models, brands, product designs, software created by the various teams are all intellectual property that can be owned, licensed, transferred and enforced – or lost, if not adequately protected.
Copyright Act, 1957 is the primary vehicle for protecting software in India. While a copyright subsists automatically in an original software code, the ownership depends on whether it was created by an employee during the course of employment or by a contractor under a contract including an IP assignment clause or by a founder before the company was incorporated. We conduct IP audits that map ownership across an entire codebase, identify chain-of-title issues, and design employment and contractor agreements that create defensible IP ownership position from the beginning. We also manage trademark portfolios, advice on patent strategy for software-implemented inventions under the Patent Act, 1970 and assist online and offline in IP enforcement.
SaaS commercialisation – subscription, licensing and tax structure
The commercial model of a SaaS business — subscription-based, usage-metered, or hybrid — has specific legal implications that distinguish it from traditional software licensing. A subscription agreement is not simply a service agreement with a monthly payment but also defines the scope of the licence granted, the permissible number of users, the handling of data on termination, the process for price changes, the auto-renewal mechanics, and the conditions under which the customer can exit. Clarity and compliance under these terms is critical to ensure smooth scaling-up of the business.
Under the CGST Act, 2017, software provided as a service (SaaS) is taxable at 18% GST. The correct classification of a product as ‘software as a service’ versus ‘packaged software’ versus ‘information technology enabled service’ affects both the GST rate and the place of supply rules — which in turn affect which state’s GST applies and whether the transaction is treated as an export of service (zero-rated) for cross-border SaaS. The Equalisation Levy under the Finance Acts of 2016 and 2020 applies to foreign companies providing specified digital services to Indian users or operating an e-commerce platform — and the compliance obligation, including registration and filing, falls on the foreign company.
We structure SaaS commercial agreements, advise on subscription pricing frameworks, review enterprise and government procurement contracts for SaaS vendors, and advise on the tax treatment of SaaS revenue across domestic and cross-border contexts.
Data privacy, cybersecurity and cross-border data governance
Technology companies, sitting at the centre of the data economy, carry substantial obligations under the Digital Personal Data Protection Act, 2023 qua data collection, protection using appropriate technical standards, processing and sharing, responding to data principal’s requests as well as notification and remedial responsibilities in the event of a breach. The CERT-In Directions further provide incident response as well as log retention requirements. For IT/ITES companies serving overseas clients, GDPR, UK GDPR, US state privacy laws as well as other regional privacy laws require multi-framework compliance and management.
We design practical and operational data governance frameworks, work with the engineering and product teams on data architecture decisions, advise on consent management systems, draft data processing agreements both with upstream clients and downstream vendors and build incident response playbooks for each relevant jurisdiction.
IT/ITES export of services, SEZ and STPI compliance
India offers significant tax and regulatory incentives to IT companies operating from Software Technology Parks of India (STPI) units or Special Economic Zones (SEZ). These structures offer income tax exemptions, duty-free capital goods import, and GST-free domestic procurement — but they also carry substantial compliance obligations, and the consequences of non-compliance (de-bonding, duty recovery, loss of tax benefits) are material.
Export of IT and ITES services also creates obligations under FEMA, 1999 — regarding the realisation and repatriation of export proceeds, the approved methods of receiving foreign payments, and mandatory reporting to authorised dealer banks. The Income Tax Act also prescribes transfer pricing obligations on related-party transactions between an Indian IT company and its overseas subsidiaries or affiliates.
We advise on the design and maintenance of SEZ and STPI compliance frameworks, the conditions for zero-rating exported services under GST, the FEMA obligations associated with service exports, benefit schemes under the Foreign Trade Policy and the transfer pricing documentation required for intra-group IT service arrangements.
Fundraising, M&A and investor transactions
Legal dimensions of any transaction – whether it is raising a seed round, s Series A, a PE growth investment or preparing for a strategic sale, acquisition or a public listing – require expertise in tech-company diligence and valuation, IP ownership, ESOPs regulatory approvals and the specific requirements and warranties that the technology business carries. IP diligence in a tech company is critical for any investor. It is essential that the company owns or holds the licenses to all the IP embodied in its products and solutions, that the employment agreements include adequate IP assignment clauses, that open-source usage does not create license conflicts and there are no outstanding IP claims. For cross-border transactions, FEMA clearances, RBI reporting, and CCI merger control notifications are also part of the process.
We manage these transactions end-to-end, from term sheet through to closing.
Employment, Workforce & ESOP
Technology companies often face specific employment law challenges that general commercial businesses do not – particularly around protecting confidential information, enforcing IP ownership, structuring ESOP schemes and managing a workforce spread across states and countries. Broad post-termination non-compete clauses are generally not enforceable in India under section 27 of the Contract Act, 1872, prompting the use of well-drafted confidentiality obligations and non-solicitation clauses, garden leave provision for key employees of clients and IP assignment clauses for protection of proprietary information.
ESOP schemes for technology companies must comply with the Companies Act, 2013 and the related SEBI regulations for listed companies. For companies with overseas employees, the intersection of Indian ESOP rules, the foreign country’s securities laws, and the tax implications in both jurisdictions requires coordination between Indian and foreign counsel.
Companies thus, have to balance between their desire to hire quickly, maintain workplace flexibility and protect proprietary information on one hand with the obligations imposed by the four Labour Codes (Code on Wages, 2019; Industrial Relations Code, 2020; Code on Social Security, 2020; Occupational Safety Code, 2020) and the State Shops and Establishments Acts and the Sexual Harassment Act on the other.
We draft employment contracts, handbooks, design and document ESOP schemes, advise on exercise pricing and vesting schedules, compliances under the Sexual Harassment Act, and manage the cross-border compliance dimension.
Serving regulated-sector clients – compliance as a sales enabler
Technology companies catering to regulated-sector clients such as financial services, healthcare or government, have to address additional sector-specific regulatory frameworks as part of their legal environment. Banks and NBFCs operating under the RBI’s Guidelines on Managing Risks in Outsourcing of Financial Services must ensure that their technology vendors meet specific security, business continuity, and audit standards — and must include specific provisions in their vendor contracts. Similar obligations are imposed by SEBI’s Circular on Cloud and Technology Risk Management, IRDAI’s IT Framework, and the DPDP Act’s data processor obligations upon IT vendors handling regulated-sector client data.
We help technology companies understand the regulatory obligations of their client sectors so as to imbibe compliance requirements within the product and the contract – thus reducing the risk of regulatory gaps, contractual disputes, and costly redesigns at a later stage.
Dispute resolution – technology litigation and ADR
Technology disputes are a distinct litigation category. They frequently involve questions that require technical as well as legal expertise: whether delivered software meets the specifications agreed in the SOW, whether an SLA was breached, whether source code has been copied, whether a data breach resulted from the vendor’s security failure or the client’s own negligence. Courts and arbitration tribunals are increasingly sophisticated about technology disputes, but the quality of legal preparation — and the ability to translate technical facts into legal arguments — remains decisive.
We represent technology companies in disputes before courts, arbitration tribunals, and intellectual property adjudicatory bodies. We handle SLA disputes, IP infringement proceedings (including urgent Anton Piller orders to preserve digital evidence), employment disputes involving IP and non-solicitation claims, and regulatory proceedings before CERT-In, the Data Protection Board, and the CCI. For international technology disputes, we work with international counsel networks across the UK, Singapore, UAE, and the US.
Competition law and platform regulation
Technology companies at scale increasingly attract competition law scrutiny. The Competition Act, 2002 prohibits anti-competitive agreements and abuse of dominant position — and the Competition (Amendment) Act, 2023 has added new tools specifically designed for digital markets, including the concept of a ‘significant digital enterprise’ (SDE) that will, once the rules are notified, be subject to ex-ante obligations similar to those imposed by the EU’s Digital Markets Act. For technology companies with large market shares in their product categories, or those that rely on network effects, data advantages, or platform architecture to maintain their competitive position, understanding the competition law dimension of business decisions is increasingly important.
We actively engage with technology companies on merger control filings under the Competition Act (where the applicable thresholds are met), on the competition law implications of exclusive dealing arrangements with distribution or channel partners, on platform conduct that may attract CCI scrutiny, and on how to respond to CCI investigations and market studies.
Why Corrida Legal?
Our technology practice is fuelled by lawyers who understand how software is built, how the technology companies are funded, how enterprise sales cycles work, and how the regulatory environments that govern data, IP, and tax intersect with each other in a technology business – and that understanding changes the quality of the advice we give.
The legal environment for technology companies is being actively shaped across at least six regulatory bodies — MeitY, RBI, SEBI, CERT-In, CCI, and the Income Tax Department — and several proposed legislative instruments (Digital India Act, Digital Competition Bill) that are at varying stages of development. We track each of these as they evolve and brief our technology clients on the implications before they become compliance obligations.
We understand that speed matters in a technology business in a way that it may not in other sectors and aim to provide timely, direct and practical advice calibrated to the commercial outcomes. Given the global nature of technology business, we equally focus on managing cross-border compliance as a standard part of our technology practice through a wide network of international affiliates.
FAQs
When should a technology startup get legal advice?
Ideally, before the first enterprise customer, fundraising round, or overseas expansion. Early legal structuring of contracts, IP ownership, privacy compliance and commercial terms is significantly more cost-effective than correcting issues during due diligence or a dispute.
Does the company own the software developed by its employees and contractors?
Not always. While software created by employees during the course of employment is generally owned by the employer, the position is different for founders, consultants and independent contractors unless appropriate contractual assignments are in place.
The company sells SaaS globally. Does it need to comply with laws outside India?
Often, yes. Company’s compliance obligations may arise from where its customers are located, where personal data is processed, contractual commitments, or sector-specific regulations such as GDPR or other foreign privacy laws.
Can the company limit its liability in SaaS agreements?
Yes, but liability clauses must be carefully drafted. A well-negotiated limitation of liability provision should appropriately allocate commercial risk while remaining enforceable under the governing law.
What obligations arise when a cybersecurity incident or data breach is detected?
Under the CERT-In Directions, 2022, cybersecurity incidents must be reported to CERT-In within six hours of detection — one of the shortest mandatory windows globally. The DPDP Act, 2023 additionally requires notification to the Data Protection Board and affected individuals without undue delay. For IT/ITES companies processing client data, the data processing agreement determines whether notification obligations flow to the company directly or through the client.
What legal risks are associated with using open-source components in a commercial product?
Different open-source licences impose different obligations regarding attribution, redistribution and, in some cases, disclosure of derivative source code. In a SaaS context, copyleft license components may trigger disclosure obligations for the entire product codebase. These issues are most consequential, and hardest to remedy, when they surface during M&A due diligence. Therefore, a structured open-source compliance review can help identify and mitigate these risks.
The company’s customers include banks and healthcare companies. Does that affect its legal obligations?
Yes. Technology vendors serving regulated sectors often need to comply with contractual, security and audit requirements arising from sector-specific regulations issued by regulators such as RBI, SEBI or IRDAI, in addition to general data protection laws.
What are the principal legal considerations when integrating AI into a technology product?
AI integration requires attention at three stages. First, training data: licences for data sourced from third parties frequently do not cover AI training use, creating copyright infringement exposure under the Copyright Act, 1957. Second, output ownership: the Act requires a human author for copyright to subsist, leaving AI-generated outputs potentially unprotectable. Third, liability: products that make automated decisions affecting end users require clearly drafted liability allocation provisions in client contracts. MeitY’s advisory of March 2024 and the AI Governance Guidelines establish the regulatory intent in this space ahead of a formal legislative framework.
The company uses standard templates for its customer contracts. Is that enough?
Usually not. Technology contracts need to reflect the product, pricing model, data flows, service commitments, liability allocation and intellectual property structure specific to the company and the nature of transaction at hand. Generic templates often leave key commercial and legal risks unaddressed.
How can legal advice help accelerate enterprise sales?
Enterprise customers increasingly assess legal and regulatory readiness before signing contracts. Clear contract documentation, privacy compliance, security commitments, IP ownership and sector-specific regulatory alignment often shorten procurement cycles and improve customer confidence.
