What is an end user licence agreement (EULA)?
The basics: This template is for an end user licence agreement (EULA) for off-the-shelf software which can be bought and accessed through a browser. The document operates as standard terms and conditions for the use of the software and sets out the user’s obligations and restrictions that apply to its use of the software.
Drafted from a supplier’s perspective: As it is software suppliers / licensors who prepare and present EULAs to end users, this EULA template assumes that you are the software supplier / licensor and is therefore drafted pro-supplier.
Option to sign or use click-wrap: The template EULA includes options so that it can either be signed by the user or instead be accepted by a click-wrap method.
What is click-wrap: Click-wrap is a way of ensuring that users accept terms of use, without having to sign a contract to agree to those terms formally. The user’s agreement to the terms is demonstrated by a “tick-box” when the user either enters their payment details, creates a user account or downloads the software. It is important that the tick box includes clear acceptance wording, so there can be no argument that the terms have not been accepted.
Why should you have a EULA in place?
Protects your rights in the software: A EULA will protect your rights in software, as the supplier / licensor of software, by defining a clear scope in which a user can use the software and therefore preventing them from using it in other ways. The EULA will make it clear that the rights to the software are owned by you and/or your licensors and not the user, and also limit your liability to the user in the event that there are issues with the software.
Restrictions on the user’s use of the software: The EULA sets out clearly defined prohibitions and restrictions in relation to the user’s use of the software, and allows you to revoke the EULA (or suspend the user’s access to the software) where the end-user does not comply with those terms. This means that the user is prevented from exploiting your software.
Key provisions: This EULA template contains key provisions in relation to:
- the scope of the software licence granted to the end user;
- restrictions on use of the software by the end user;
- intellectual property right protections (in favour of you as the software supplier);
- limits on your liability; and
- disclaimers and warranty exclusions.
When should this template EULA be used?
Do not use this template if the end users are consumers: It is very important that this is not used where customers may include consumers (individuals) purchasing software for themselves. There are strict requirements under consumer legislation which this EULA does not include.
The template also makes the following assumptions:
- The end user is a business user;
- The software fees are not high (less than a few thousand per year). If higher fees, please see the Software Licence Agreement;
- The software will be used by a user based in the UK; and
- The software supplier company is a company registered in England and Wales.
Why Docue?
With Docue, you can create a top-quality EULA in minutes. The service includes model clauses designed by business lawyers to help you draft the contract yourself and tailor it to your needs.
Signatures can be collected electronically, and all contracts you make are saved in your company's own contract account.
