An affiliate program terms and conditions template saves you from writing rules from scratch, and it protects your store before the first commission is paid. Clear terms tell affiliates how they earn, what they may not do, and when you pay. This guide walks through each clause you need, explains why it matters for Shopify and cash on delivery (COD) stores, and gives you a copy-and-edit template at the end.
One note before we start: this article is general information, not legal advice. Laws differ by country, so have a local lawyer review your final terms.
Why your affiliate program needs written terms
Many small stores launch an affiliate program with a sign-up form and a commission rate, and nothing else. That works until the first dispute. Then questions come up that nobody answered in advance:
- Does an affiliate earn on an order the customer refused at the door?
- Can an affiliate buy through their own link to get a discount?
- Is it okay to run Google Ads on your brand name?
- When exactly do you pay, and how?
Written terms answer these questions once, for everyone. They also help you stay consistent. When every affiliate agrees to the same rules at sign-up, you can say "no" to a bad request without it feeling personal.
Terms also matter for compliance. In the United States, the Federal Trade Commission (FTC) updated its Endorsement Guides in June 2023. The guides say brands can be held responsible when the people promoting them fail to disclose a paid relationship. Other countries have similar advertising rules. Your terms are where you tell affiliates, in writing, that disclosure is required.
If you are still setting up your program, start with our guide on how to start a Shopify affiliate program, then come back to write your terms.
The core clauses every template should include
Most affiliate agreements share the same building blocks. Below is what each one covers and what to think about when you fill it in.
1. Enrollment and approval
Explain who can join and how you approve them. State that you may accept or reject any application, and that joining does not create an employment relationship or partnership. Affiliates are independent. They pay their own taxes and costs.
2. Commission rate and what counts as a sale
Say how much affiliates earn and on what amount. Common choices:
- A percentage of the order subtotal, before shipping and taxes
- A fixed amount per order
- Different rates for different products or affiliate tiers
Be specific about exclusions. For example, you might exclude shipping fees, taxes, gift cards, or orders that use a different discount code. If you are unsure what rate to set, see our guide on affiliate commission rates.
3. Attribution and tracking
Affiliates want to know how they get credit. Describe the rules in plain words:
- Which tracking methods count (affiliate link, coupon code, or both)
- How long a referral stays valid after a click (the cookie or referral window)
- What happens when two affiliates touch the same order
Many programs use "last click wins," which means the affiliate whose link was clicked last before the purchase gets the credit. Whatever rule you choose, write it down. It prevents most "why didn't I get paid?" emails.
4. When a commission becomes payable
This is the most important clause for a COD store. A Shopify order is not a real sale until the customer accepts the parcel and pays. Orders can be cancelled, refused at the door, returned, or refunded.
Your terms should say that commissions start as pending and only become approved after:
- The order is delivered and paid
- A hold period has passed (to cover returns and refunds)
Hold periods vary a lot between programs. Some use 7 days, others use 30 days or more. A good starting point is to match your hold period to your return window. Also state that cancelled, refused, returned and refunded orders earn no commission, and that partial refunds reduce the commission in proportion. For more on this, read our article on COD affiliate marketing.
5. Payment terms
Tell affiliates:
- How often you pay (for example, monthly)
- The minimum balance before a payout (for example, $20)
- Which payment methods you support (bank transfer, mobile wallet, PayPal)
- Which currency you pay in
- Who pays transfer fees
Ask affiliates to keep their payment details up to date, and say that you are not responsible for payments sent to wrong details they provided.
6. Prohibited activities
This clause protects your margins and your brand. Typical items include:
- Self-referrals. Affiliates may not earn on their own orders, or orders placed for them by family or people at the same address.
- Fake or incentivized orders. No placing orders that the affiliate knows will be refused or returned.
- Brand bidding. No paid search ads on your store name, product names, or misspellings of them, unless you approve it in writing.
- Coupon and deal sites. Decide whether you allow them. Many programs require approval first, because these sites often capture sales that would happen anyway.
- Spam. No unsolicited messages, bulk messages to bought lists, or posts in groups that ban promotion.
- Misleading claims. No false health, income, or price claims, and no pretending to be the store.
- Trademark misuse. No registering domains or social handles that include your brand name.
7. Disclosure and advertising rules
Require affiliates to clearly disclose that they earn a commission. Under the FTC's guidance, the disclosure must be clear and easy to notice. The FTC's FAQs say that a label like "affiliate link" alone, or a "buy now" button, is not enough, while a clear phrase like "paid link" or "I earn a commission if you buy" next to the link can work.
8. Coupon codes
If you give affiliates their own coupon codes, set the rules:
- The code is for the affiliate's audience only
- It may not be posted on coupon sites unless approved
- You may change, pause, or delete the code at any time
- Orders using a leaked code may not earn commission
9. Multi-level or team bonuses (if you offer them)
If affiliates can invite other affiliates and earn a bonus, explain how it works. Keep it simple and limit it to one level. State that the bonus is a percentage of the invited affiliate's approved commission, so it is only paid on real, delivered orders.
10. Customer data and privacy
State that affiliates do not get access to customer personal data, and that they must follow privacy laws when they collect any data themselves (for example, an email list).
11. Changes, suspension and termination
Say that you may update the terms with notice, and that continued participation means acceptance. Explain when you can suspend or end an account (for example, after a fraud flag or a rule breach), and what happens to unpaid commissions. A fair approach is to pay approved commissions earned through valid activity, and cancel commissions linked to the breach.
12. Liability and governing law
Limit your liability, state that the program is provided "as is," and name the country or state whose laws apply. This is the part a lawyer should check most carefully.
Quick reference: clauses and why they matter
| Clause | What it decides | Why it matters for COD stores |
|---|---|---|
| Commission rate | How much affiliates earn | Sets your margin per order |
| Attribution | Who gets credit | Stops disputes between affiliates |
| Payable conditions | When pending becomes approved | Protects you from refused and returned orders |
| Payment terms | How and when you pay | Sets expectations for mobile wallet or bank payouts |
| Prohibited activities | What is not allowed | Blocks self-referrals and fake orders |
| Disclosure | How affiliates label paid content | Reduces legal risk for your brand |
| Termination | How the relationship ends | Lets you act fast on fraud |
Affiliate program terms and conditions template
Copy this template and replace the text in square brackets. Remove any clause that does not apply to your program.
[Store Name] Affiliate Program Terms and Conditions
Last updated: [date]
1. About the program. These terms apply to everyone who joins the [Store Name] affiliate program ("Program"). By applying, you agree to these terms. You are an independent partner, not an employee, agent, or partner of [Store Name].
2. Joining. We review every application and may accept or decline it for any reason. You must be at least [18] years old and provide accurate information.
3. Commissions. You earn [X]% of the order subtotal, excluding shipping, taxes, and [other exclusions], for each valid order referred through your affiliate link or affiliate coupon code.
4. Attribution. An order is credited to you if the customer uses your coupon code, or clicks your link within [X] days before ordering. If more than one affiliate referred the customer, the last affiliate click before the order gets the credit.
5. Pending and approved commissions. Every commission starts as pending. It becomes approved only after the order is delivered and paid, and a hold period of [X] days has passed. Cancelled, refused, returned, and refunded orders earn no commission. If an order is partly refunded, the commission is reduced in proportion. Approved commissions may be reversed if a refund happens later.
6. Payouts. We pay approved commissions [monthly] once your balance reaches [$X]. Payouts are made by [bank transfer / mobile wallet / PayPal] in [currency]. You are responsible for keeping your payment details correct and for any taxes on your earnings.
7. Team bonus. [Optional] If you invite another affiliate who is approved, you earn a bonus of [X]% of their approved commissions. Bonuses apply to one level only and are paid by [Store Name] on top of their commission.
8. Not allowed. You may not:
- Earn commission on your own orders or orders placed for you by family or people at your address
- Place or encourage fake orders, or orders you know will be refused or returned
- Bid on [Store Name] or product names in paid search ads without written approval
- Post your coupon code on coupon or deal sites without written approval
- Send spam or unsolicited messages
- Make false or misleading claims about our products, prices, or policies
- Use our trademarks in domain names, usernames, or ads without approval
Orders linked to these activities earn no commission and may lead to removal from the Program.
9. Disclosure. You must clearly tell your audience that you earn a commission, in every post, video, or message that promotes [Store Name]. The disclosure must be easy to see without clicking "more."
10. Customer data. You will not receive customer personal data from us. Any data you collect yourself must be handled according to applicable privacy laws.
11. Changes and termination. We may update these terms by giving you [X] days' notice by email. We may suspend or end your participation at any time. If we end it for a breach of these terms, unpaid commissions related to the breach are cancelled. Otherwise, we pay approved commissions earned before termination.
12. Liability. The Program is provided "as is." Our total liability to you is limited to the approved commissions owed to you. These terms are governed by the laws of [country/state].
13. Contact. Questions? Email [affiliates@yourstore.com].
How Taguu helps you enforce your terms
Taguu is a Shopify affiliate app built for COD stores, and many of the rules above are handled automatically. Commissions stay pending until the order is delivered (and paid for COD) plus a hold period (7 days by default). Cancelled, refused, returned, and refunded orders are reversed automatically, and partial refunds recalculate the commission. Self-referrals where the order email or phone matches the affiliate get no commission and are flagged. Attribution follows a clear order: affiliate coupon first, then last-click UTM, then a referral cookie saved on the cart. You can also record payouts by bank transfer, mobile wallet, or PayPal with a reference. Taguu has a free plan, and paid plans include a 14-day free trial. Install Taguu to put your terms into practice.
FAQ
Do I need a lawyer to write affiliate terms?
A template is a good starting point, but laws differ by country. Have a local lawyer review your final version, especially the liability and governing law sections.
How long should the commission hold period be?
There is no single standard. Programs use anywhere from 7 to 30 days or more. A typical starting point is to match the hold period to your return window.
Should affiliates earn commission on COD orders that are refused?
No. A refused COD order brings in no revenue, so most COD stores pay commission only after the order is delivered and paid.
Can I change my affiliate terms later?
Yes. Say in your terms that you may update them with notice, update the "last updated" date, and email affiliates about the change.
Do affiliates need to disclose that they earn a commission?
Yes, in many countries. In the US, the FTC expects a clear and easy-to-notice disclosure next to the recommendation, not hidden behind a link.