Legal Framework of IT Outsourcing and Global Sourcing: A Comparative Approach from the Indian, Anglo/American and German Legal Perspective

Abstract

At the latest since the dawn and rise of globalisation, IT outsourcing and global sourcing are part of every company’s business plan and, in fact, business reality. In many ways globalisation and IT outsourcing/global sourcing are inextricably intertwined and one cannot say with certainty which trend followed which. Businesses today have been able to take advantage of technology in order to use models such as offshoring in order to reduce their costs without a corresponding decline in quality. However, concerns such as data confidentiality and security issues have emphasised the need for businesses to take considerable care when dealing with cross-border transactions. As outsourcing (offshoring) always involves companies from two jurisdictions, some knowledge of different legal regimes is required. This article examines the outsourcing model in the context of the information technology industry and looks at the most important clauses and legal issues in such contracts in the light of Indian law, Anglo-American law and German law.