Abstract. In our model for autonomic management of service level agreements (SLA), the roles played by policy and rules must be clearly differentiated. Although policy is typically an ideal we wish to achieve through the implementation of rules, the use of the terms policy and rule are often treated similarly and that consequently policy-engine and rule-engine are often used synonymously. It is our position that in the management of SLAs these terms have specific meanings. The definitions and models embodied are illustrated.