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Know everything about End User License Agreement

An End User License Agreement (EULA) is a contract between the author or publisher of a software application and its user. It is also called a software license that allows a user to use a software after agreeing to pay some consideration for the privilege of the publisher, of using the software.
Written by:
Shivi Gupta
Published on
24-Jul-18

An End User License Agreement (EULA) is a contract between the author or publisher of a software application and its user. It is also called a ‘software license’ that allows a user to use a software after agreeing to pay some consideration for the privilege of the publisher, of using the software. 

The EULA compels the user to abide by the restrictions mentioned in the EULA pertaining to the use of the software. A pop-up window that prompts a user to check a box that shows they accept the terms before continuing is a common and effective way of obtaining acceptance for legal terms. The user is asked to accept the stipulations of the contract through a ‘shrink-wrap’ or ‘click-wrap’ agreement. 

The agreement is accepted in different modes such as opening the application package, using the CD, installing the application or even by just using the application. The user has the option to reject the agreement through the option of ‘I disagree’ when they’re caused to accept the EULA at the time of software installation. 

 

A software is the Intellectual Property of a vendor and the user has to agree to certain restrictions with regards to how often and when can the application be used, before agreeing to the EULA. What is often overlooked is the fact that agreeing to the mentioned terms of the EULA implies that the user is agreeing to purchase or rent the license to use the software from the vendor.  

The EULA allows the user to use the Intellectual Property of the software publisher and therefore, it must be drafted in a manner that it protects the interests of the user, primarily protecting the Licensor from any form of IPR infringement. Following are the certain things to keep in mind while drafting an EULA: 

Product Description: While drafting the EULA, it is important that specifications regarding the software like its type, trademark, special feature, functions, etc. are mentioned. Product updates and version must be specified in the agreement.

Duration of the License: The most important thing to be mentioned in an EULA is the duration for which the buyer can use the software. The exact period of commencement and the termination of the license must be clearly specified in the agreement. This is because many users may be able to bypass this by altering the time and date settings on their computers or formatting their disks. 

Grounds for termination:  The grounds on which the Licensor can terminate the license must be mentioned. These grounds may include copying the software, using it beyond the duration of the license, etc. 

Legal Jurisdiction: The EULA must specify that both the Licensor and the user will be bound by the laws of India and must mention the court which will have jurisdiction over the matters in case a dispute or infringement arises. The agreement must also specify if any alternative dispute resolution methods are preferred by the Licensor to which the user agrees.

Limitation on Liability: This clause is commonly called “Limitations of Liability“ and makes it clear that the Licensor will not be held responsible for any damages that arise out of the use of the app.

An effective and thorough EULA will ensure that anyone who uses the software publisher’s application, is aware of the fact that the publisher controls all the rights over the product and the user’s rights go only so far as the publisher allows. It is advised to consult an IPR lawyer to get the EULA drafted rather than opting for template agreements which fail to cover these important aspects of a software and publisher’s rights. Hire the best IPR lawyers from MyAdvo. Email us at info@myadvo.in or call now at 9811782573.