End User Licence Agreement

An End User Licence Agreement, or EULA, as it is often called, is a document through which an owner of software broadly licenses the software for online users. Most often, EULAs are provided in the context of software for sale online, but sometimes, individuals or companies that share their software for free also govern the provision of that software through EULAs.

For any owner of software wishing to share that software with the public, an EULA is a good idea, as it allows the owner to dictate the terms on which that software is shared. The software doesn't have to be a large, complex program; it can be any piece of software which is provided for the public.

The EULA document on any website or mobile app creates a legally binding set of rules for the user regarding how the software can be used and shared (if applicable). A well-written EULA will also cover items that are absolutely not permitted regarding the software, such as reverse assembly or security breaches.

This agreement is different from an Intellectual Property Licence Agreement, which may be used to licence any type of intellectual property, like a copyright or trademark, between two specific parties, the Licensor and the Licensee. This is in contrast to an EULA, where the owner of the software is licensing it for general public use.

This agreement is also different from an Intellectual Property Assignment Agreement, which may be used for any type of intellectual property, when one party wants to sell all rights in the intellectual property to another party.

If the owner is making software available on a website or mobile application, then the owner is also likely to require other documents for the website or application. For example, the owner may require a set of Terms and Conditions for Website or Mobile Application, which set out rules for users of a website or mobile application. They may also require a Privacy Policy for Website or Mobile Application. If the owner is also offering services (for example, custom built software or software maintenance services), then a Service Agreement may also be required.

How to use this document

This EULA will allow entry of details about the software and the license. It also includes space for additional restrictions that the software owner may wish to apply, beyond a basic form licence. There is also additional space for different categories of licences if there are more than one.

The EULA itself is rather simple to fill out, as most online EULAs for small- to medium-sized businesses are similar.

In order for the EULA to be legally binding on a user of the software, the user will have to actually be aware of the terms of the EULA, and will have to agree to them. So firstly, the EULA will need to be presented to the user (often this is done by publishing it on the website or application where the software was accessed).

Some owners simply make the EULA available somewhere on the website or application where the software is accessed (usually on a separate page, accessible via a hyperlink) and claim that by downloading or using the software, users agree to the EULA. This is known as a "browsewrap" agreement. However, in these circumstances, if there is a dispute, it may be possible for a user to argue that they never actually saw the EULA and therefore they never actually agreed to it. In some cases, the user might be able to argue that they are not bound by the EULA, which can be a big problem for the owner.

Therefore many other owners make the user take positive steps to confirm that they have read, understood and accepted the terms of the EULA. For example, sites might have a popup box that contains the entire EULA. The user has to scroll to the bottom of the EULA and then check a box (that is otherwise unchecked) to say "I have read and understood the terms of this End User Licence Agreement and agree to be bound by them". This is known as a "clickwrap" agreement.

Websites or applications that use clickwrap agreements often also make sure that the "I agree" box appears on the same page as the entire EULA (so that the user cannot argue that although they checked the box, they did not actually see the terms of the EULA). It is also common for websites or applications to highlight specific terms for the user's attention if those terms might be seen as particularly unfair on the user.

The owner of the software should also make sure they have a system for keeping track of who has agreed to this EULA. If there is ever a dispute in relation to the software, the owner will need to be able to produce evidence which proves the user has actually confirmed their agreement.

Applicable law

There are various pieces of legislation in Australia which may affect intellectual property rights, such as the Copyright Act 1968 (Commonwealth); the Patents Act 1990 (Commonwealth); the Trade Marks Act 1995 (Commonwealth); and the Designs Act 2003 (Commonwealth).

The Australian Consumer Law, which is set out in Schedule 2 of the Competition and Consumer Act 2010 may also apply.

In addition, the common law may apply to intellectual property matters. For example, Australian case law has considered many issues regarding copyright, such as what items are protected by copyright, and how long copyright protection might last.

An EULA is a contract and general principles of contract law, as provided by the common law, may also apply.

If in doubt, seek legal advice.

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