What is the delivery clause?
This clause sets out your deadline for delivering the finished manuscript to the publisher and the publisher’s deadline for publishing the work. Beware the delivery/publication clause that says your work has to be ‘satisfactory to the publisher’ or that fails to mention a publication deadline. In the first case your work may be rejected for no good reason; in the second the publisher could retain the rights indefinitely without publishing the book.

What is the difference between licensing and assigning copyright?
A licence gives the publisher an exclusive right to publish the work, but you – the author – still own the copyright.  If you ‘assign’ rather than ‘license’ the work to the publisher, the publisher will own the copyright. Assignment might be reasonable if the price is right, but it rarely is. If you are considering assigning copyright, get advice first.

What is the territories clause?
This clause defines the territories in which the book can be sold. The ASA recommends Australian rights only unless the publisher can exploit world rights. The publisher should be able to demonstrate considerable success in foreign markets before you give them world rights. Don’t be afraid to ask about other books they have sold overseas.

How much should the advance be?
The rule of thumb publishers use for advances is half the estimated royalties on the first print run. A small advance means that the publisher has little investment in the work. For example, a $3,000 advance on a book that will sell for around $30 suggests that the publisher expects to sell only about 2,000 copies ($3,000 divided by $3 royalty x 2). The book is likely to have a miniscule marketing budget. A $15,000 advance on the other hand…

How much should the royalties be?
The standard royalty is 10% of Recommended Retail Price (RRP), but established writers can negotiate higher rates. Authors of educational and romance books may have to accept slightly less. The ASA recommends rising royalties –10% on sales up to 3500, 12.5% from 3,500 to 5,000 and 15% over 5,000 copies. Beware royalties that are calculated on the publisher’s net receipts or price received: they will work out at 6% or even less of RRP. Also watch out for the withholding of royalties against returns. Some publishers try to withhold 50%.

What is the warranty/indemnity clause?
Most publishers ask you to warrant that your work is not defamatory or obscene, and to indemnify the publisher – i.e. pay their costs – if you are incorrect. No author can promise that a manuscript is defamation-free. If you’re nervous about a specific point, talk to your publisher about it. Attempt to contain any indemnity to no more than what you earn from the work.

What is the termination/reversion of rights clause?
Under most contracts the rights in the book revert to the author if either party breaks the contract, if the publisher goes broke, or if the work goes ‘out of print’ and is not re-printed within a given period. Once the rights have formally reverted to the author you are free to enter into a contract with another publisher. Lately, some publishers have tried to assert their rights to CAL payments after the rights have reverted. The wording of the contract is crucial in situations like this.

What if I get into a dispute with my publisher?
The ASA recommends mediation as an alternative to arbitration or litigation. If your contract is with an overseas or interstate publisher, the contract will be governed by the laws that apply in that country or state. Mediation can be held anywhere in the world by phone or email and is less expensive than lawyers.

Feeling overwhelmed? You might want to try the ASA's Contract Advisory Service, which offers members expert legal advice on publishing contracts.