Consultancy agreements

Many consultancy projects require agreements to be put in place between the University and the company.

  • Research Services will draft an appropriate consultancy agreement and send to the company for signature.
  • Often, the University will receive agreements from companies for consultancy projects, which will also be reviewed by us, but please note, this negotiation often takes longer and may cause delay to the start of a project.

Further information on consultancy, and how to request an agreement is available on the consultancy pages.

Below is a summary of the key points that are considered during the contract negotiation stages. To set up a consultancy arrangement please complete a Costing and Proposal Form.

Project details

  • We will check the details of the project with those you have provided us with to ensure that all parties agree on the work programme.
  • We will, where possible, ensure that an agreed document such as the proposal or description of work is included in any agreement.
  • Please remember that although we have extensive experience of negotiating contracts, and will have some information about your project, we may still need your input at this stage to ensure that our information is correct and complete. We understand that the smallest error can have substantial consequences on the project and its intended results.


  • We need to ensure that the timescale for carrying out each stage of the project is adequate for the work that needs to be done.
  • We will use the information you have provided in the Costing and Proposal Form to check this is correct. If at any stage we are concerned that the timescale is too strict, we will liaise with you.
  • If timescales cannot be adhered to this could lead to delayed payments or, in the worst case, breach of contract and termination.

Financial and budgetary details

  • We will check any figures against the signed Budget Proposal Form.
  • As consultancy is a commercial service, the University must charge UK VAT when delivered to a UK-based organisation. If the customer is not based in the UK we may still need to charge UK VAT. The VAT rules are complex and there are some exceptions to the rules above, it is therefore important that the contract states the consultancy fees are "exclusive of VAT and VAT will be charged if applicable". This enables us to add VAT to the invoice if required to do so by law. (If a contract is silent on charging VAT, then VAT is treated as included in the quoted fee. The University is still required by law to charge VAT on the consultancy fee but can then only issue an invoice for the total agreed fee. Once the VAT is paid HMRC, the project will be short on the expected funds).
  • We will also check that the payments are not linked to any outputs or results, since these may not materialise and thus leave the University in deficit on the account.
  • Where the University has not worked with an organisation before and the contract value is greater than £10,000 we will carry out a full credit check to determine how payments will be required. For example, if you are receiving income from a new company then we will normally request payment in stages in advance, but if your fee is from a recognised organisation we will accept payments in arrears.

Ownership of results and arising IP (Foreground IP)

  • The University acknowledges that where a company has commissioned a specific piece of consultancy, they will normally seek ownership of the Foreground IP. We also accept that the contracting company will often be in the best position to protect and commercialise this IP. Provided that the contractor has agreed to pay a price acceptable to the University, we will normally concede on ownership of Foreground IP, unless there is a specific objection detailed in the Costing and Proposal Form.
  • Regardless of rights to commercially exploit Foreground IP, the University will invariably exercise its rights to use Foreground IP for internal teaching and research purposes as this enables us to fulfil our obligations to HMG in respect of maintaining academic excellence. This will be properly expressed in any contract or agreement and we will be receptive to allied confidentiality issues. We will also ensure that no agreement requires any author to waive their moral rights in connection with any documents produced for the company.

University know-how/pre-existing knowledge (Background IP)

  • Often an organisation will wish to work with the University because we already possess know-how and pre-existing knowledge ("Background IP") necessary for the undertaking of a consultancy. In the majority of situations the Background IP required to undertake consultancy is self-evident from the beginning and, where appropriate, we will undertake to identify it in the contract.
  • Where our Background IP is required to commercialise Foreground IP, the University will normally undertake, subject to other third party obligations, to negotiate a fair and reasonable licence on that Background IP to a sponsor.


  • The University understands that when working with other organisations the parties may need to exchange confidential and commercially sensitive information.
  • We routinely issue and accept confidentiality agreements to protect early stage discussions. We need to ensure that confidential information is treated as such by all parties as there could be implications if applications are made for patent or other IP Rights protection.
  • In addition, we need to ensure that other organisations are aware that we are subject to the Freedom of Information Act 2000. More information on the Freedom of Information Act 2000 and the University obligations under this Act can be found at


  • In order to maintain both our and your academic excellence and reputation now, and in the future, it is important that our academic staff are able to publish the results of their consultancy wherever possible.
  • Therefore, when undertaking consultancy, the University will normally seek to reserve its right to publish the results of that work.
  • We do however understand that in many cases the company will need to use the Foreground IP commercially and we will normally agree to delay publication for a reasonable period to allow patents to be lodged and to liaise with the company over the presentation of any commercially sensitive results that are in a proposed publication.

Warranties, guarantees and indemnities

  • As a University, it is our practice to use reasonable endeavours to ensure all work is carried out to the highest standard (that is how we maintain our position of excellence). However, results can never be guaranteed and it is our policy not to offer any kind of warranty or guarantee that specific objectives can be met, but rather to undertake to work with the company to agree alternative routes when consultancy generates unanticipated results.
  • Furthermore, we will not normally accept any liability for use a company may make of the results, although we will of course endeavour to work co-operatively to mitigate any problems they may encounter.
  • Recently we have had a number of organisations request indemnification from the University for claims of infringement of IP rights from third parties. This area of law is very difficult to regulate and therefore complicated and expensive to defend any such claim. In the event that an organisation requests such indemnity, we will normally suggest that we will ensure reasonable enquiries are made to establish whether any third parties may potentially have cause to claim but that we cannot provide an indemnity. As we do not have an unlimited pot of money to pay out in the unlikely event of a lawsuit, we will ensure that all claims are limited to direct loss only. We will also ensure that the University’s liability is limited to the total contract price. All these factors are important to ensure the University does not have to use its resources dealing with legal actions and can instead use those resources to maintain our position and reputation.


  • Results are never guaranteed therefore it is vital that when things do not quite go as planned the parties discuss how to take the project forward. Sometimes the only solution might be to terminate the project.
  • We try to ensure that all agreements allow termination to be imposed by any party but only after a reasonable period has been given for discussions and attempts to remedy any issues.
  • Normally where the company decides to terminate a project for any reason other than failure by another party, they will cover all costs already allocated or incurred in connection with the project.

Contracting Party

  • The contracting party in a contract must be the University of Sheffield as an institution rather than the individual academic undertaking the consultancy services.
  • An agreement with the individual as a party cannot be signed by the University. An agreement can however state that the University is represented by an individual academic who can be named throughout (where applicable) and an academic can be an acknowledging signatory. This is because the University is the contracting party in this case and the academic is undertaking the work as part of their contract of employment with the University.
  • All consultancy contracts must also be signed by an authorised Research Services signatory.

Who to contact

Please contact the Contracts Help Desk on 0114 22 27444 or with new enquiries.

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