What is Formal Contract Logic (FCL)

It is a typical scenario that many organisations have their business processes specified independently of their business obligations (which includes contractual obligations to business partners, as well as obligations a business has to fulfil against regulations and industry standards). This is because of the lack of guidelines and tools that facilitate derivation of processes from contracts but also because of the traditional mindset of treating contracts separately from business processes. This chapter will provide a solution to one specific problem that arises from this situation, namely the lack of mechanisms to check whether business processes are compliant with business contracts. The chapter begins by defining the space for business process compliance and the eco-system for ensuring that process are compliant. The key point is that compliance is a relationship between two sets of specifications: the specifications for executing a business process and the specifications regulating a business. The central part of the chapter focuses on a logic based formalism for describing both the semantics of normative specifications and the semantics of compliance checking procedures.