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License agreements

Region: Ontario Answer # 358

In the context of computer hardware and software, technology license agreements are a contract between a licensor who owns the technology and the licensee or purchaser of the right to use the technology. A license agreement sets out how the licensed copy of the technology can and cannot be used, who owns it and any limits on liability in its use.

License agreements are very common, often appearing on-screen when installing new software or updates, and even on the Internet when accessing data services or applications.

Typically, a licensee or user must click on an ‘accept’ button before being allowed to use the technology and thereby acknowledging his or her acceptance of the terms of the license. These types of agreements are variously called click-through agreements, shrink-wrap agreements, click-wrap agreements, browse-wrap agreements, or, more correctly, end-user licensing agreements or EULAs.

Most EULAs limit liability for loss of data or other damage caused by the technology unintentionally. The agreement may enforce government regulations, such as prohibiting the export or transfer of technology to certain countries. The agreement will also dictate whether the user can copy the technology for archival and back-up purposes, or use it on more than one machine. The EULA will also likely state that the technology remains the property of the licensor and cannot be re-sold without its permission.

For help creating or dealing with a license agreement, contact a computer or technology lawyer.


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