Web Services provide standardized interfaces for accessing software systems and data sources over the Internet. Semantic descriptions of Web Services help to automate the discovery and invocation of new services and their integration into existing applications. However not all services are freely available for every purpose and not all data is in the public domain. Usage policies describe the terms and conditions under which services and data can be used. Current approaches to semantic Web Service description are mostly focused on functional properties and quality attributes, and do not cover usage policies. We plan to develop a formal language for usage policies with clearly defined semantics that relies on ontologies for representing domain specific terms. We will also extend service discovery and ranking algorithms to incorporate usage policies.