Last Updated February 29, 2024
What is an End User Licence Agreement?
An End User Licence Agreement (EULA), also known as a software licence agreement, is a document in which someone purchases the rights to use a computer program, software, or application under specific terms and conditions that are set out by the software vendor or publisher.
A EULA often appears as a popup before or after you've downloaded a program or installed an update on your computer. However, some software may be sold with a physical copy of a licence agreement at a retail outlet or through mail order. In this case, the agreement may come into effect once you’ve opened the package or installed the program.
Whether the EULA is in digital or physical form, the agreement is important for software developers who want to maintain some control over the use and distribution of their product.
Who are the parties to an End User Licence Agreement?
An End User Licence Agreement is typically between two parties:
- The licensee, also known as the end user or purchaser, is the individual or organisation buying the rights to use a computer program, software, or application.
- The vendor, also known as a software licensor or publisher, is the individual or organisation selling the rights to use their product.
A EULA grants an end user with a licence to use a program while retaining the publisher's ownership rights.
An End User Licence Agreement typically contains information about who is licensed to use the software, how they are permitted to use it, and when the licence will be effective.
For instance, with LawDepot's EULA template, you can specify if the licence is effective:
- When the agreement is executed
- When the package seal is opened
- When the software is registered
- When the software is installed
- Perpetually (i.e. the licence does not expire)
- For a specific length of time (e.g. one year)
In addition to some personal details about the licensee and vendor, LawDepot's EULA template specifies how the product may be used by including terms such as:
- The type of licence being granted (e.g. a site licence allows the purchaser to install the software on multiple computers instead of just one)
- Limitations of liabilities and warranties (e.g. the licensee accepts the software “as is”, meaning in whatever condition the product is in)
- Restrictions of use (e.g. the software may not be altered or reverse-engineered by the licensee)
What happens when someone violates a EULA?
Including a EULA with the distribution of your computer program can provide you with some legal protections if the program is ever used inappropriately.
For example, a EULA often protects the software vendor's intellectual property rights by stating the licence is for use only and is not a transfer of ownership. If a licensee tried to copy and redistribute the product, a vendor could use a signed, physical copy of a EULA as evidence of the licensee's agreement to abide by the software terms and conditions.
However, it's important to note laws may vary based on jurisdiction. EULAs are unique in that the agreement can and often will cross borders. The vendor might live and develop the software in Sydney, Australia, but the software might be used anywhere else in the world. As such, it's recommended you review how contracts are enforced wherever the software will be used.
Sample
End User Licence Agreement (EULA)
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