AI consultancy agreement

An AI consultant advises a business on what to adopt, how to adopt it and what to avoid, often runs pilots with the business's data, sometimes recommends vendors it has relationships with, and delivers strategies whose success depends on the client's execution. The agreement has to set the scope (advice, selection, implementation, or all three), the consultant's independence from vendors, the ownership of deliverables and the retention of the consultant's methods, the treatment of the client's data in pilots, the warranties the consultant can give about outcomes, and the line the consultant must not cross into regulated advice. The AI provisions for the agreement are drafted or reviewed for a fixed £595 and delivery in five working days.

Who this is for

AI consultants, strategy advisers and implementation specialists in England and Wales, and businesses engaging them who want the engagement to produce something they own and can rely on.

What matters in an AI consultancy agreement

The scope of AI advice and the implementation the consultant does or does not do

The agreement states what the consultant will do (assess the business's processes, identify use cases, evaluate and recommend tools, design governance and policies, run pilots, train staff, implement, measure) and what it will not (build software, host systems, operate the tools, provide legal or regulated advice), with each engagement's statement of work stating the deliverables, the client's responsibilities (access, data, decisions, staff time) and the assumptions; the commonest dispute is a client who expected implementation from a consultant who sold strategy, and the scope clause is where it is prevented.

Independence, the vendors and the commission the client should know about

A consultant that receives referral fees, commissions or partner status from the vendors it recommends has an interest the client is entitled to know about, and the agreement either warrants the consultant's independence (no financial interest in any recommended vendor) or discloses the interests and requires disclosure of any that arise, with the client's consent to recommendations where an interest exists; the Bribery Act 2010 is engaged where a commission is concealed to induce a recommendation, and a consultant's reputation is engaged well before that; the agreement also states that vendor selection is the client's decision on the consultant's analysis and that the consultant does not warrant the vendors' products.

Deliverables, intellectual property and the methodology the consultant keeps

The deliverables (reports, strategies, use-case assessments, governance documents, pilot results, training materials) are assigned to the client, with the consultant's pre-existing materials, frameworks, methodologies, prompts and tooling retained by the consultant and licensed to the client for its internal use, and the consultant free to reuse its know-how for other clients (without the client's confidential information); under the Copyright, Designs and Patents Act 1988 the author of a computer-generated work is the person who made the arrangements (section 9(3)), a rule untested on modern tools, and only original works are protected, so deliverables containing generated elements are classified and the consultant's AI use is disclosed, with the client's restrictions on tools stated at the outset.

The client's data, the pilots and the tools the consultant brings

Pilots run on the client's data in tools the consultant selects, and the agreement states who contracts with the tool providers for the pilot (the client, so that the data processing terms and the licences are the client's; or the consultant, as the client's processor, with the tools as its sub-processors), what data may be used (anonymised or synthetic where possible, with production data only with the client's authorisation), and what happens to the data and the pilot outputs at the end; personal data put into an AI tool is processed under the UK GDPR like any other, requiring a lawful basis, a notice to the people concerned, a data processing agreement with the provider under Article 28 and an impact assessment under Article 35 where individuals are affected, and a pilot on real customer data without the assessment is the breach the consultant is being paid to prevent; confidential information, trade secrets and clients' data must not be entered into tools whose terms permit the provider to use inputs for training or to retain them, which the Trade Secrets (Enforcement, etc.) Regulations 2018 and the business's own confidentiality obligations make a question of reasonable steps, and the agreement's confidentiality clause permits the pilot tools on stated conditions.

Outcomes, warranties and the adoption that did not deliver

The consultant warrants that it will perform the services with reasonable care and skill, that its advice will be based on the information the client provides and the consultant's professional judgement, and that its deliverables will meet the statement of work, and does not warrant that the client will achieve any particular saving, revenue, accuracy or adoption, because those depend on the client's execution, its staff, the vendors and the market; where the consultant's fee is linked to outcomes the metrics are defined as for a model (stated, measurable, on agreed data, with the client's contribution stated), and the agreement's reliance clause confines the advice to the client and the stated purpose.

Liability, insurance and the regulated advice the consultant must not give

Liability is capped at a stated multiple of the fees with indirect loss excluded, the consultant holds professional indemnity insurance that covers AI consultancy (confirmed, since some policies exclude it), and the agreement states that the consultant does not provide legal, data protection compliance, financial, medical or other regulated advice, that the client should obtain it where needed, and that governance documents the consultant drafts are frameworks for the client's own legal review; the Data (Use and Access) Act 2025 amended Article 22 of the UK GDPR so that a solely automated decision with legal or similarly significant effects is lawful outside special category data only with the safeguards of information, representations, human intervention and the right to contest, and a consultant recommending automated decision tools states that the client's compliance is the client's; the consultant's status as an independent contractor is preserved by clauses that govern deliverables rather than working methods.

What it costs

AI provisions in a contract, £595. Review or draft AI-specific terms in a supply or customer agreement. Five working days.

AI use policy, £995. Internal policy plus the accompanying contract provisions. Five working days.

Email me at geoffrey@caesar.co.uk with what you need and any documents, and I will confirm the scope and the fee in writing, usually the same working day.

What you get

• An internal AI use policy your staff will follow, rather than a document that bans everything and is quietly ignored
• Contract provisions covering output ownership, training data, confidentiality and liability
• A defensible position to give customers who ask what your AI governance looks like
• Review of your AI suppliers' terms, including what they reserve the right to change
• Practical guidance on what to permit, what to restrict and what to prohibit outright
• One round of amendments

What is not included

• Technical AI assurance, model testing or bias auditing
• Sector-specific regulatory approval
• Advice on non-UK regulatory regimes beyond flagging where they apply
• Ongoing regulatory monitoring

Questions I am often asked

Should the agreement cover implementation as well as advice?

Only if the consultant is doing it, in which case the statement of work says so with deliverables and acceptance. The commonest dispute is a client who expected implementation from a strategy engagement, and the scope clause prevents it.

Does the consultant have to disclose vendor commissions?

Either warrant independence or disclose the interests and obtain the client's consent to recommendations where one exists. A concealed commission that induces a recommendation engages the Bribery Act and the consultant's reputation before it.

Can the consultant warrant that AI adoption will deliver savings?

It should not: outcomes depend on the client's execution, vendors and market. The consultant warrants reasonable care and skill and the deliverables; an outcome-linked fee needs defined metrics on agreed data with the client's contribution stated.

Related guidance and services

• AI contracts and AI use policies, £595, the service this page describes
• SaaS and technology contracts, £995
• Data protection agreements and privacy terms, £795
• AI development agreement for a bespoke model
• Consultancy agreement for a retainer arrangement

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: October 2026. Email geoffrey@caesar.co.uk.