hmmm it should not ban or suspend the user accounts for hosting "illegal" things,you should atleast allow bot-nets,stealers and other "traditional" things to be hosted and as like every other providers, You can cancel the account if you found any child porn/rapid leech/dos shells/spam e-mails on your hosting,..
Also the hosting should have a good up-time and the price should be affordable...
- Onshore/offshore hosting - Shared & VPS packages - Good uptime is a must
As mandi says affordable prices, however I understand how competitive the hosting game is so that bit is up to you George. I'd rather pay over the odds for better uptime and decent customer service then cheap hosting that has crap uptime, loopholes in TOS and or crap customer services.