Referral Agreement in United Kingdom: Template and Key Clauses (2026)

A referral agreement in the United Kingdom sets out the terms on which one business sends potential customers to another and is paid for introductions that convert. Referral fees are lawful in most of the economy, but there are important exceptions, and there is a general risk that a badly structured fee looks like an improper inducement. This guide sets out the UK rules that actually matter, the key clauses, and a drafting skeleton. It is general information, not legal advice; take UK advice before signing a live deal. ## What is a referral agreement in the UK? It is a contract between a referrer, who introduces prospective customers, and a recipient, who provides the goods or services and pays a fee or commission for qualifying referrals. The agreement defines what counts as a referral, when a fee is earned, how much it is, and how the parties behave towards each other and towards the customer. It is not a partnership or an agency unless the parties intend that, so the drafting should make the nature of the relationship clear. ## What law and rules govern referral agreements in the UK? There is no single referral statute. The agreement rests on ordinary contract law and is then shaped by several rules: - Bribery Act 2010. A referral fee is lawful commercial behaviour, but a payment made to induce someone to act improperly, for example a professional steering a client against the client's interests, can be an offence. Keep fees transparent and tied to genuine introductions.

• Sector bans and restrictions. Some sectors restrict or ban referral fees. In personal injury work, referral fees are prohibited under the Legal Aid, Sentencing and Punishment of Offenders Act 2012. Solicitors must follow the Solicitors Regulation Authority rules on referrals and transparency. Estate agents must disclose referral arrangements. Regulated financial services referrals fall under the Financial Conduct Authority regime, including the rules on financial promotions.
• Disclosure to the customer. Even where a fee is lawful, the customer often has to be told about it. Hidden commissions can be challenged as a breach of duty or an unfair practice.
• Data protection and marketing. Sharing a prospect's details engages the UK GDPR and the Data Protection Act 2018, and electronic marketing to introduced contacts engages the Privacy and Electronic Communications Regulations.
• Consumer protection. The consumer protection rules on unfair and misleading practices apply to how referrals are presented. ## Key clauses in a UK referral agreement - Definition of a referral: what counts, and when an introduction becomes a qualifying, fee-earning referral.
• Fee and payment: amount or percentage, trigger event, timing, clawback if a deal falls through, and whether VAT applies.
• Exclusivity: whether the referrer may introduce to competitors, and whether the recipient accepts referrals from others.
• Disclosure and compliance: an obligation to disclose the arrangement to customers where required, and to follow sector rules.
• Anti-bribery: a warranty that neither party will make improper payments, consistent with the Bribery Act 2010.
• Data protection: lawful basis for sharing prospect data, consent for marketing, and UK GDPR roles.
• No authority: confirm that the referrer cannot bind the recipient or make representations on its behalf.
• Term and termination: duration, notice, and whether fees survive for referrals already made.
• Governing law: England and Wales, Scotland or Northern Ireland. ## When a referral fee becomes a problem The fee itself is rarely the issue. The problem is a fee that is hidden from the customer, or that rewards a professional for steering the customer badly, or that operates in a sector where the law forbids it. A clean UK referral arrangement is transparent, pays for a genuine introduction rather than for the outcome of advice the referrer should give impartially, and checks the sector rules before any money changes hands. Where a professional adviser is involved, assume disclosure is required and confirm the regulator's position. ## A simple drafting skeleton 1. Parties and date

2. Definitions, including what counts as a referral
3. The referral service and how introductions are made
4. Fee, trigger event, payment timing and VAT
5. Clawback and failed deals
6. Exclusivity (if any)
7. Disclosure to customers and sector compliance
8. Anti-bribery warranty (Bribery Act 2010)
9. Data protection and marketing (UK GDPR and PECR)
10. No authority or partnership
11. Confidentiality
12. Term and termination
13. Governing law and jurisdiction
14. Signatures ## Common mistakes to avoid - Paying referral fees in a banned sector, such as personal injury work, without checking the statute.

• Hiding the fee from the customer where disclosure is required.
• Structuring a fee so it rewards improper steering, which risks the Bribery Act 2010.
• Sharing prospect data or marketing to introduced contacts without a lawful basis under the UK GDPR and PECR. ## Keeping referral arrangements under control If you run many referral partners, the hard part is not one agreement. It is tracking which arrangements carry disclosure duties, which sectors restrict fees, when each term ends, and which clawback terms apply. Drafting from a tuned template, flagging risky clauses per contract, and keeping versions straight is what an AI contract workspace can hold in one place. Adira is built for this, with per-clause risk review, plain-English clause editing and a live activity timeline. It is India-first today, with UK and other jurisdictions on its roadmap, so confirm local depth before relying on it for UK sector rules. More at Adira. The law above stands on its own. ## Bottom line A UK referral agreement is straightforward in most of the economy, but it turns on two questions: is a referral fee allowed in this sector, and does the customer have to be told. Answer those first, keep the fee transparent and tied to a genuine introduction, respect the Bribery Act 2010 and data rules, and take UK advice before signing a real deal.