Legal Formalities of setting up ODC & Hiring Offshore Software Developers

Legal Formalities of setting up ODC & Hiring Offshore Software Developers

In this post, we’ll learn about what is ODC, how can you find the best ODC service provider for your business, what legalities should you be aware of while setting up an offshore development center, how to set up one for your organization, and certain other things to consider when setting up your own offshore development center.

Without further ado, let’s start learning!

What is ODC?

An ODC or offshore development center is responsible for providing a development team with reliable office infrastructure, manpower that includes expert developers, admin support, and even human resources. Usually, a project manager is assigned to take care of the entire project and teams to smooth business operations. Most importantly, an offshore development center is situated in a foreign country, positively an extension of your organization.

To get in-depth insights, read our other post What is Offshore Development Center.

ODC Checklists to Find Best Service Provider

Offshore Development Center

So, every organization wants to hire developers in an offshore development team, which helps them attain their organizational goals with the least possible hassle. This ODC checklist to find the best service provider definitely helps:

1.Have You Defined the Detailed Job Description?
The first step is to ensure that your new team knows what you want out of them - in terms of performance, skills, dedication, loyalty, and on-time target completion. Also, be specific about the specifications, features, and customizations you need in your app. The new team must know everything in detail to deliver what matches your expectations.

2.  Does the ODC team have a Proven Track Record?
Next, you will need to figure out whether what is being claimed by your ODC team is based on a proven record or not. Since your team will be in a foreign country, you can find it challenging to figure out the absolute truth. However, if you spend time researching about them, scan their history, speak to their ex-clients, or even ask for some proven results, it wouldn’t be wrong.

3. Are You Getting the Access to Latest Code
You have the right to receive the code that is being used in the development processes. Unfortunately, many developers refuse to do so. Hence, you should make it one of the prerequisites to get complete access to the code right from the beginning to avoid any possible conflict in the future. Apart from that, be sure to make yourself the admin/owner of all related accounts on clouds, Github, and other platforms used in the entire development process.

4. What’s Their Modus Operandi?
Ask your new team if they are flexible enough to add more developers to the project. Sometimes, even after the ODC team being pro in their work, it just fails to suit our business needs. Hence, a keen observation, clear communication, and deep understanding of what is about to happen between your company and the ODC team are essential. Simply put, it is imperative to understand the modus operandi of the ODC team to make development a seamless process for both of you.

5. What are their Expectations?
Do not drool over the trap of the cheapest quotes - that’s probably not going to help your firm win a good team. Of course, every company wants to save costs. However, it should not be at the stake of your firm’s reputation. Collaborating with a team that doesn’t deliver quality will only cost you more - more time, more money, more stress, and more effort wasted. Hence, it is highly recommended to set a budget, recruit the ODC team that is not highly expensive or cheap, and, most importantly, pick someone who values quality over everything else.

6. Do They Prefer to Agree or Argue?
An ODC team can be in the sink with your firm and operations if they only maintain the balance of both. For example, are they just arguing over everything, including price, time, delivery, or flexibility? If yes, you need to reconsider your decision. On the other hand, if they just agree on everything would not be an advisable team. The best team would raise queries or doubts and disagreements when needed, remain silent, and agree to what’s right.

7. Are They Aware of the Best Tools and Technologies?
Well, to be sure of the quality of work delivered, you will need to see whether the ODC team is aware of the latest tools and technologies prevailing in the market. Also, what project management tools they are using for their operations should be figured out. Since you don’t need someone with outdated technologies and tools, we recommend you to have a thorough discussion about this in advance. The use of collaboration tools like Slack, Jira, and Trello is recommended.

Offshore Development

How to Setup ODC?

Once you have followed the checklist of reaching out to a reliable ODC, it is time now to set one to start your collaboration smoothly. Here’s what you need to follow to setup an ODC:

1. Pick Your Location
Don’t be confused by so many destinations offering offshore development center services nowadays. All you need to do is thorough research and study the marketplace of different countries to figure out the most profitable one for yourself. Also, pay attention to locations with low operational and labor costs but manage to have a highly technical, skilled, and experienced team.

2. Find Reliable and Trusted ODC Team
Estimate risks, study the market and do a deep research of your ODC team and the country you choose to work. That’s the only actual way to meet a team that is genuinely reliable and trustworthy for your reputed organization. Also, you will have to be very precise about what you want and convey the same to your team to be on the same page.

Offshore Development Center

3. Begin The Recruitment Process
Once done with partnering up the trustworthy and reliable ODC team, it is recommended to begin the recruitment process. First, your team will analyze the current labor market and choose the eligible candidates for completing your project successfully. In that, you will analyze their skills, experience, knowledge, and capacity to deliver results as needed.

4. Set Up Security Measurements
Now, you have the required team and experts to start work, and recruiters are already picking up talents for the team. It is time you need to discuss other things like the security of employees. The office space, location, parking lots, security system, seats, equipment, and other facilities must be planned.

5. Legal Support is a Must
You can’t peacefully do things without proper legal support. Consult lawyers to sign any contracts, and they will give you the best advice about the terms and conditions of that specific country you have chosen. Of course, you need a deep understanding of how things work there besides having profound negotiation skills to make the most of it.

6. Organize HR Payroll

ODC setup
Once everything is done, it is advised to check again on recruited people and organize HR payroll to support the functioning of the new ODC. You will need a responsible and knowledgeable person to handle the salaries, payment transfers, and other financial transactions between the ODC and the head office. So. make sure you have a person with profound knowledge in human resources before you actually make the payments.

Legal Formalities of Setting Up ODC( Contract Components)

Offshore Development
There are certain legal formalities, which you need to fulfill before finally setting up your ODC abroad. Since the country is different from your country, it is imperative to understand what all legalities are involved in setting up an ODC in a foreign land. Let’s suppose you don’t want to deal with the legalities; you can simply hire an expert. However, the legalities are unavoidable.

Contract Service Agreement
A contract service agreement is a contract, generally written or verbal, that sets out the terms and conditions for service between two parties, including the service provider and the customer. Some even refer to it as a contractor form, a contractor agreement, a freelance agreement, or an independent contractor agreement.

So, this is the first thing you need to prepare and get signed by your new ODC team to ensure it is a hassle-free business that ends up contenting both parties.

NDA or Non-Disclosure Agreement
The next essential is to sign an NDA or Non-Disclosure Agreement, which is also referred to as the confidential agreement, secrecy agreement, or proprietary information agreement. It is a legal contract or a part of a contract between at least two parties, who are signing it with some specific purposes; however, they wish to restrict access to certain confidential material, knowledge, or information shared between the parties.

So, before finalizing the ODC, you will need to discuss these two essentials to maintain the secrecy and confidentiality of your business in the foreign land. Read our other post on Pitfalls of ODC and its Solution.

Things to Consider When Setting Up ODC

Hire Offshore Developers
So, we talked about how you could set up an ODC seamlessly and deal with the legalities involved. We even learned how you could find your reliable ODC team without much hassle.
Now, let’s jump into some handy tips that will help you maintain your ODC seamlessly.

✅ Be clear about how frequent the communication will be between both of you.
✅ Don’t let time be the constraint; plan how you will manage time difference.
✅ Make sure to pick an experienced team, as that will save your training costs.
✅ Don’t always think about cost reduction. Skills and knowledge matter the most.
✅ Introduce your existing team to the new ODC team for a healthy business.
✅ Don’t shy away from clearing your doubts at any business point.
✅ Both your existing and ODC team must be clear about the goals of your firm.
✅ Engagement is critical; make sure you invest a lot of time in it.


Setting up an ODC might be a challenging task but not impossible. With a clear understanding of what you want to achieve with this team, your goals, and other processes involved, you can easily set up your own ODC anywhere. Businesses are powering up using their ODC and expanding exponentially like never before. We recommend you to take a plunge, hire developers, and make way for success with your reliable offshore development team now.

At your Team in India, we have a team of technology experts. If you want to hire Developers, set up ODC, or have any questions on what all services we offer at Your team in India– Click here to contact us.

Manik Sharma

Manik Sharma

Dynamic and results-oriented business head at Signity Solutions with a proven track record of driving growth and profitability. Strategic thinker, adept at leading teams, developing new opportunities, and delivering exceptional business outcomes.