Contract trap · Vendor and freelance
Agency holds your assets hostage
The web/marketing agency registers the domain, hosting, CMS, analytics and ad accounts in its own name, keeps all credentials, retains source code and third-party licences, and grants the client only a revocable licence; ownership transfers 'upon payment in full of all amounts, including disputed amounts' (or never).
- Severity
- Severe
- How often it turns up
- Regular
- Holds up?
- Usually enforceable
- Clause phrases
- 20
What it looks like in a contract
Redline matches these phrases against your document verbatim. Drafters rarely invent new wording — they copy it, which is why the same sentences turn up across unrelated contracts.
In English-language contracts
- domain names registered by Agency
- hosting accounts shall remain the property of
- all logins and credentials remain with
- Agency retains ownership of source code
- ownership transfers only upon payment in full of all amounts, including disputed amounts
- revocable license
- third-party licenses in Agency's name
- ad accounts owned by Agency
- data export fee
- Agency shall be the registrant
In Russian-language contracts
- доменное имя регистрируется на Исполнителя
- администратором домена является Исполнитель
- хостинг оформляется на Исполнителя
- исключительное право переходит после полной оплаты всех платежей
- Заказчику предоставляется неисключительная лицензия
- доступы передаются после подписания акта
- рекламный кабинет принадлежит Агентству
- исходный код не передается
- лицензия может быть отозвана
- передача доступов является платной услугой
Check your own contract
Paste a clause, a page or the whole document. Nothing leaves your browser: the matching runs here, on this page, against the phrases above.
Why it bites
Your website, your brand's domain, your ad history and your customer data can be switched off or held for ransom the moment you dispute an invoice or try to leave; re-creating a domain and ad-account history can cost more than the whole project.
Is it enforceable where you are
The same clause can be routine in one country and void in another. What follows is what the law says where you are — not advice on your particular contract.
B2B terms get much less protection: in the UK, UCTA 1977 s.3 tests standard terms for reasonableness; in the EU, the Late Payment Directive 2011/7 caps payment terms and P2B Regulation 2019/1150 applies to platforms.
United States
Pure contract — enforceable; registrar/ICANN rules treat the named registrant as owner and recovery requires litigation or UDRP; ad platforms recognise the account owner, not the payer.
European Union
Enforceable; no special SMB protection; GDPR gives the client a route to its customer data (controller/processor) but not to the domain or code.
- Cited
- GDPR
United Kingdom
Enforceable; Nominet/registrar transfer disputes are contractual; courts will not imply a transfer of domain ownership.
Russia
Действительно: администратор домена — тот, на кого он зарегистрирован, перерегистрация только по его заявлению или решению суда; по умолчанию исключительное право на заказной сайт принадлежит заказчику (ст. 1296), но условие «после полной оплаты» законно; лицензия без указания способов использования толкуется узко (ст. 1235).
- Cited
- ст. 1235
- ст. 1296
Where this has actually happened
No named case is on file for this trap yet.
What to do
In order, from the thing that takes a minute to the thing that takes a letter.
- Register domain, hosting and all platform accounts in the client's name from day one and give the agency delegated access
- Require credential handover and a full export on termination (within 5 days, no fee)
- Source code in a client-owned repo
- Licences in the client's name
- IP transfer on payment of undisputed amounts only
- Verify WHOIS/registrar ownership before final payment.
Traps that travel with it
Drafters who use one of these usually use several.