Terms of Service: what it is, what investors check, and what it costs across Africa

What the document is

Your terms of service (also called terms of use, terms and conditions, or a user agreement) is the contract between your company and anyone who uses your product. It is not a formality you paste in before launch. It is the document that decides who owns what, who pays for what, and who is liable when something breaks.

A real terms of service covers, at minimum:

• Acceptable use. What a user is and is not allowed to do on your platform, and what happens if they break the rules (suspension, termination, forfeiture of funds already paid).
• IP ownership of user-generated content. If users upload content, post reviews, or build things on your platform, the terms state who owns that content and what licence you have to use it. This matters a lot for marketplaces, social products, and anything with user-submitted media.
• Payment terms. Billing cycles, currency, what happens on a failed charge, auto-renewal rules.
• Refund and cancellation rules. What a user is entitled to if they cancel, and on what timeline.
• Liability caps. The maximum amount your company can be made to pay out if something goes wrong, and the categories of loss you exclude (usually consequential and indirect losses).
• Dispute-resolution jurisdiction. Which country's courts, or which arbitration body, hears a dispute if one arises. This is one of the first things a cross-border investor or acquirer checks, because it tells them where they would have to sue you, or be sued by your users.

A terms of service is a different document from a privacy policy. The privacy policy governs what you do with personal data; the terms of service governs the commercial relationship, product use, and money. Some jurisdictions blur naming conventions (South African firms sometimes call it "terms of use" for a marketing site and "terms of service" for a transactional product; a few use "user agreement"), but the content expected inside is consistent everywhere: it is the rulebook for using your product, and it is where you allocate risk between you and your user.

If your product touches consumers directly (as opposed to being sold business-to-business under a negotiated master agreement), your terms of service also has to survive scrutiny under your country's consumer protection statute, which typically restricts how far you can push liability caps and cancellation terms against an individual user. We cover which statute applies in each market below.

What an investor is actually checking for

By the time a diligence lawyer opens your terms of service at Series A, or a CFO opens it during an acquisition, they are not reading it for tone. They are running it against a short, specific checklist, and each item maps to a real failure mode they have seen before.

Does the liability cap actually protect the company, or is it decorative? A cap that says "our liability is limited to the greater of $100 or fees paid in the last 12 months" is standard and defensible. A cap that is missing entirely, or that contradicts a separate indemnity clause elsewhere in the document (so the company appears to have both capped and uncapped exposure to the same event), is a red flag. It tells the lawyer nobody who understands contract drafting has touched this document, which raises the question of what else in the company's paper trail was self-served.

Does the IP ownership clause match what the product actually does? If your product lets users upload content and you have no clause granting yourself a licence to display, store, and process it, you have no legal basis for the product working the way it works. This shows up hardest in diligence for social, marketplace, and UGC-heavy products, where an acquirer's lawyer will ask directly: "under what clause do you have the right to host this content?" If the answer is "we don't have one," that becomes a condition of closing, not a footnote.

Is the dispute jurisdiction realistic and does it match your actual company registration? A Kenyan-incorporated company whose terms of service specify Delaware courts and Delaware law, copied wholesale from a US SaaS template, is an immediate flag. It signals the founder used an off-the-shelf template without adapting it, and it raises the follow-up question of what else was copied without review. Diligence lawyers specifically check that the governing law clause matches the entity's actual jurisdiction of incorporation, not the jurisdiction of a template's origin.

Can the "we may" clauses actually be audited? Vague permissive language like "we may share data with partners" or "we may modify these terms at any time" without a notice mechanism is treated as unverifiable rather than protective. A clause that cannot be checked against what the company actually does operationally (who are the partners, what is the change-notification process) cannot be relied on, so it gets flagged as needing rework rather than credited as a working control.

Do the refund and cancellation terms match your actual billing system? If your terms of service promise a refund window your payment processor and support workflow cannot actually deliver, that inconsistency surfaces the moment a customer complaint or chargeback dispute is checked against the paper terms. For a fintech or subscription business, a diligence team specifically pulls a sample of support tickets and checks them against the stated policy.

Was it ever actually agreed to? Lawyers check whether your product uses clickwrap (an active "I agree" action, logged, timestamped) versus browsewrap (a link in the footer nobody has to click). Browsewrap is weaker evidence of a binding contract and is one of the more common findings against African-founded products that copied a template without adapting the acceptance flow that goes with it.

The common thread across all of these: an investor is not grading you on having a terms of service. They are checking whether the one you have was actually built for your product, your entity, and your jurisdiction, or whether it is décor.

What it costs to get done properly, by African jurisdiction

Costs below are what we could verify from published sources as of July 2026. Where no reliable public figure exists for terms-of-service drafting specifically, we say so rather than estimate, and point you to where to get a quote instead.

A pattern across all five markets: nobody publishes a clean "terms of service costs X" number, because the price depends on how much of your product's specific behaviour (payments, refunds, UGC, data sharing) the lawyer has to actually think through, not just template. Budget for the fee range above as a starting point and expect the number to move with how many product-specific clauses you need.

Where to get it

Do not use an unadapted Delaware or US template as your live terms of service. This is the single most common mistake we see, and it does not cost you anything at signing. It costs you later, in one of two moments: due diligence for your next round, when a lawyer checks whether your governing-law clause matches your actual entity, or in an actual dispute with a user, when you discover the arbitration clause points to a US body that has no jurisdiction over a claim filed against a Kenyan or Nigerian entity, so the clause is unenforceable and you are back to litigating in your home courts anyway, on terms you never actually reviewed for that outcome.

The specific risks:

• Jurisdiction mismatch. A SAFE, Series Seed document, or generic US SaaS terms-of-service template is written for a Delaware C-corp under US contract and consumer law. Your Nigerian, Kenyan, South African, Egyptian, or Ghanaian entity is not that, and a court or arbitrator in your jurisdiction may simply refuse to apply a foreign governing-law clause that has no real connection to the transaction.
• Copyright. Most "free terms of service template" sites (generic generator tools, some law-firm-branded downloadable templates) are marketing assets, not open-licence documents. Redistributing or reselling them, or presenting a lightly-edited copy as your own drafted work in a diligence data room, carries real infringement exposure on the publisher's side, separate from the jurisdiction problem above. If you use a generator tool as a first draft, treat it as a first draft only, not a final legal document.
• Consumer protection non-compliance. Nigeria's FCCPA, Kenya's Consumer Protection Act, South Africa's CPA, Egypt's Consumer Protection Law, and Ghana's Electronic Transactions Act each restrict what you can validly disclaim or limit against a consumer user. A US-drafted liability cap or arbitration clause may simply be unenforceable against a user in these markets even if you never get challenged on it, which means the protection you think you have does not actually exist when you need it.

Real, verifiable places to start:

• South Africa: MJ Kotze Inc publishes a plain-language explainer of what ECTA and the CPA require in a website terms of use, and offers fixed-fee drafting and review, quoted above.
• Nigeria: SabiLaw sells sample legal documents and runs a legal-information platform aimed at Nigerian businesses; check the licence terms attached to any specific document before you use it as more than a reference draft. LawPàdí publishes explainer content on the legal documents a Nigerian startup needs, useful as a checklist before you brief a lawyer.
• Kenya: Kenya Law publishes the full, current, official text of the Consumer Protection Act, which is the primary source your Kenyan lawyer will draft against.
• Egypt: Andersen in Egypt has published an English translation of Consumer Protection Law No. 181 of 2018, useful for briefing a lawyer even if you are not fluent in the original Arabic text.
• Ghana: the Ghana Business Regulatory Reform (BRR) portal hosts the current text of the Electronic Transactions Act, 2008 (Act 772).
• Generic (starting draft only, never final): YC's template library publishes some genuinely open-licence commercial documents (its SAFE is free and Series Seed documents are widely described as open source), but these are Delaware instruments built for a US C-corp and are not a substitute for terms of service adapted to consumer protection law in your country. Use them, if at all, to see the shape of a well-structured document, then have a local lawyer rebuild the substance for your entity and jurisdiction.

For every one of these, the honest move is the same: read the primary law yourself first so you can brief a lawyer intelligently, get a quote from a firm registered in your country of incorporation, and never sign off on a document whose governing-law clause names a country your company was not actually registered in.

Sources

• https://1stattorneys.com/articles/2025/09/13/legal-fees-in-nigeria-in-2025/
• https://sabilaw.org/
• https://mwakili.com/blog/how-much-does-a-lawyer-cost-kenya
• https://mjkinc.co.za/agreements/website-terms-of-use
• https://mjkinc.co.za/software-technology-law/ecta-electronic-contracts
• https://lawzana.com/contract-lawyers/cairo-cairo-governorate
• https://www.glc.gov.gh/resources/gba-approved-fees/
• https://lawpadi.com/4-legal-documents-for-every-start-up/
• https://new.kenyalaw.org/akn/ke/act/2012/46/eng@2022-12-31
• https://eg.andersen.com/translation-law-181-2018/
• https://www.brr.gov.gh/reg_details.php?id=NzU%3D
• https://www.ycombinator.com/sales_agreement