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Software Licence Agreements

August 2021

Following on from our new and updated EULA templates for Click-Wrap and Shrink-Wrap software, we now have two Browse-Wrap EULAs available. The B2B version of the document takes the place of our old Web-Wrap EULA while the B2C version is a new addition to our range.

What is a EULA?

An End User Licence Agreement or “EULA” is an agreement between the owner of the rights in a piece of software (such as the developer) and the end user. Where off-the-shelf software is concerned, the software will often be purchased or otherwise acquired by the end user from another party such as a reseller. While there will be a contract of sale of some form between the user and that reseller, it will be quite different from the EULA and will not typically address the use, rights, and restrictions relating to the user’s use of the software.

Browse-Wrap or Click-Wrap?

Where software is supplied electronically, for example as a download, the EULA will similarly come in electronic form, sometimes forming a part of the installation process. A browse-wrap licence is designed for acceptance through use, rather than the user taking some affirmative step (such as checking a box) to indicate their acceptance, as would be the case with a click-wrap licence.

It is important to note that the method of acceptance may have a bearing on the contractual enforceability (or lack thereof) of the licence. Authorities including the Law Commission have observed that, while a browse-wrap licence would still be a licence under copyright law, it may not constitute a contract in the view of the courts. Consequently, browse-wrap licences may be more suited to free software (although, in the case of our B2C browse-wrap licence, it is still written in a manner that assumes that the software is paid for due to complexities surrounding the meaning of “free” in matters concerning liability for damage caused by free content).

Click-wrap licences will require some affirmative action on the part of the user, often requiring a box to be checked as part of the installation process or at another point prior to using the software. From a contractual perspective, this removes concerns about the lack of enforceability. In many scenarios, therefore, a click-wrap licence (also applicable as a successor to our outgoing web-wrap licence), is the better option.

New and Updated Web-Wrap EULA Templates

Our Web-Wrap Licence templates are up-to-date with current best practice. For improved clarity and fairness over the old web-wrap template, they have been split into B2B and B2C variants.

For the most part, the B2B and B2C versions of these EULAs are the same, but they differ in some key areas, most notably the limitation of liability, and the licensor’s responsibility for damage caused to the user’s device or digital content by digital content provided by the licensor, such as a free update or software patch.

The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.

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