Start with the commercial model, not the commission headline
Before you draft a single clause, decide how the affiliate arrangement will work in practice. Will the affiliate earn on first orders only, or on repeat purchases too? Is commission based on nett sales after discounts, refunds and delivery charges, or on the full basket value? These details matter because they shape both your margin and the affiliate’s expectations.
For a Cape Town clothing retailer serving customers in Gardens, Sea Point and Bellville, the rules may be different from those for a subscription service with monthly renewals. A simple ecommerce sale might pay once, while a recurring service could pay over a defined period, such as the first three months only. If you do not spell this out, disputes start when the first payout is due.
- State the commission rate and exactly how it is calculated.
- Define the qualifying sale, including any minimum order value.
- Explain whether VAT is included or excluded from the commission base.
- Set the payment cycle, for example monthly or once a threshold is reached.
Cover promotions, brand use and content standards
Many affiliate disputes are really marketing disputes. An affiliate may want to run paid ads, send bulk messages, or use your product images on social media, while you need to protect your brand and customer trust. The terms should set out what promotional methods are allowed and which ones need written approval.
This is particularly important for businesses that sell into regulated or sensitive sectors, such as health products, finance related services, or legal support. You do not want an affiliate making promises you cannot back up. If they claim guaranteed results, free delivery, or an official endorsement when none exists, the risk lands on your side too.
- List approved and prohibited marketing channels.
- Set rules for paid search ads, social media posts and message marketing.
- Ban misleading claims, fake urgency and false discounts.
- Require use of approved logos, product descriptions and disclaimers.
For local example, imagine a Gardens based home services company using affiliates in Cape Town CBD and Paarl. An affiliate may be allowed to promote a seasonal plumbing inspection campaign, but not to advertise “same day emergency callouts” if the business cannot meet that promise in all areas. That sort of detail prevents complaints and refund requests.
Build in payment, tax and refund mechanics
Money terms should be boring and precise. Set out how and when commission is paid, what documents are required, and whether you can deduct chargebacks, refunds, cancelled orders or fraud losses from future payouts. If the affiliate needs to reach a minimum threshold before payment, say so clearly.
In South Africa, tax treatment should not be guessed at. The agreement should say whether amounts are quoted inclusive or exclusive of VAT, and who is responsible for issuing the necessary tax documentation if applicable. If the affiliate is a sole trader, a small company, or a larger organisation, the payment process may differ slightly, so the form and support requirements should match the arrangement.
- Set the payment date and payout method.
- State the minimum payout threshold, if any.
- Allow deductions for refunds, chargebacks and reversed sales.
- Explain what happens if banking details are wrong or outdated.
It is also wise to say what happens if the affiliate invoice is late. A missed document should not trigger an automatic argument. The terms can simply pause payment until the paperwork is received. That keeps things tidy and avoids chasing later.
Protect personal information and customer records
Affiliate programmes often involve customer data, even if only in limited form. If the affiliate sees leads, contact details, or order information, your terms need to address privacy, data security and lawful use. Under POPIA, you should make it clear that customer information may only be used for the purpose of the programme and must be protected against unauthorised access.
Not every affiliate should receive the same level of access. A content creator who only shares a link may need no customer data at all, while a business partner running bookings or lead follow-up may need tighter controls. The agreement should match the actual flow of information, because compliance is not optional and it needs plain wording.
- Limit access to the minimum data needed.
- Require secure storage and controlled sharing.
- Ban resale, reuse or unrelated marketing to referred customers.
- Set out what happens if a data breach is suspected.
If the affiliate collects leads on your behalf, make sure the consent wording is proper and the privacy notice is easy to understand. A short, honest explanation works better than a long legal block that nobody reads.
Set exit rights, suspension powers and dispute steps
Every affiliate arrangement should say how it ends. You need the right to suspend or terminate the relationship if the affiliate breaches the rules, damages your reputation, or becomes inactive for a long period. You should also reserve the right to change the programme rules with notice, especially where tracking tools or platform policies change.
Good terms also deal with the awkward bits. What happens to unpaid commission after termination? Can the affiliate keep using old links? Must all brand assets be removed immediately? These questions are simple now, but messy later if you leave them open.
- Allow immediate suspension for fraud, misrepresentation or serious breach.
- Set notice periods for ordinary termination.
- Say whether post-termination commission is payable on pending sales.
- Include a practical dispute process before matters escalate.
A practical clause can save weeks of back and forth. For example, if an affiliate in Stellenbosch disputes a missing sale, both sides should know what evidence is required, such as link logs, order numbers and the date of the customer action. Clear evidence rules keep the discussion factual instead of emotional.
Keep the agreement usable, not just legally neat
The best affiliate terms are the ones people can actually follow. That means short sentences, defined payouts, plain examples and no vague promises. If you are running a programme across South Africa, from Bellville to the Cape Town CBD and beyond, the agreement should work for small creators and bigger referral partners alike.
Before launch, test the terms against a real order. Follow one referral from click to checkout to payment, and see where the process breaks down. If the answer is unclear at any step, fix the wording before you invite affiliates to join. A clean programme saves admin, protects your brand and makes commissions easier to manage.
Used properly, affiliate terms are not just a legal safeguard. They are the operating rules for a channel that can grow steadily when everyone knows how the game is played.
