Contract Review Process Rule
A Contract Review Process Rule is a contract process-related policy rule that governs the procedures and workflows for reviewing contracts within an organization.
- Context:
- It can (typically) involves multiple stakeholders, including legal departments, finance departments, and business units.
- It can (often) be implemented within contract management systems or workflow management tools.
- It can range from being a Simple Contract Review Process Rule to a Complex Contract Review Process Rule.
- It can be a component of Contract Review Playbook.
- It can aims to ensure contract compliance, risk assessment, and alignment with organizational objectives.
- It can facilitate collaboration and communication among different departments involved in the contract review process.
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- Example(s):
- Multi-Level Review Rules, such as:
- "
IF a contract value exceeds $100,000 THEN it MUST undergo a three-step review process: 1) Legal department review, 2) Finance department review, 3) Executive approval, with each step to be completed within 5 business days."
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- Risk-Based Review Rules, such as:
- "
IF a contract contains high-risk clauses (e.g., unlimited liability, exclusive dealing) THEN it MUST be escalated to senior legal counsel for review, regardless of contract value."
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- Timeframe Compliance Rules, such as:
- "
IF a contract is submitted for review THEN the initial review MUST be completed within 3 business days, AND the reviewer MUST provide written feedback or approval."
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- Specialist Review Rules, such as:
- "
IF a contract involves international parties THEN it MUST be reviewed by the international trade compliance team in addition to standard reviews."
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- Approval Hierarchy Rules, such as:
- "
IF a contract requires approval THEN follow the approval matrix: 1) Under $10,000: Department Manager, 2) $10,000-$50,000: Director, 3) $50,000-$250,000: VP, 4) Over $250,000: C-level executive."
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- Revision Tracking Rules, such as:
- "
IF changes are made to a contract during the review process THEN all revisions MUST be tracked using the version control system, AND a summary of changes MUST be provided with each new version."
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- Multi-Level Review Rules, such as:
- Counter-Example(s):
- A Contract Content Review Rule, which focuses on specific clauses or terms to be included in a contract rather than the review process.
- A Contract Negotiation Rule, which governs how to negotiate contract terms rather than how to review them.
- A Contract Drafting Style Guide, which provides guidelines on how to write contracts rather than how to review them.
- See: Contract Management, Contract Lifecycle Management, Legal Risk Management, Contract Approval Process, Contract Workflow.