An End-User License Agreement or EULA is the agreement put in place between someone who purchases, installs, or downloads software, and the licensor or provider of the software.

Definition of EULA

EULA agreements are typically presented to users for acceptance during the installation or set-up stage 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 very common and effective way of obtaining acceptance for legal terms.

The terms of an EULA define the scope of how the software can be used, and any rights the buyer of the software application may have.

Liability of limitation clauses can also be included, to disclose that if the software app damages the equipment or any data of the user, the licensor or provider of the software cannot be held liable for the damages.

An EULA is important for software developers because when someone installs, downloads, or uses a copy of your software application on their computer or mobile device, they are, in essence, making a copy of the copyrighted software. This legal agreement will dictate limits and liabilities that come along with personally using this copyrighted software.

EULA vs. Terms and Conditions

Generally speaking, a Terms and Conditions agreement cover far more topics and are much broader in scope. The End-User License agreement, however, gives users the right to use the software and only covers issues that address the licensing of the software.

This kind of end-user license agreement typically pops up when a user first opens an app or begins to install an app or software program. This early and initial presentation of the agreement happens because, in order for a user to use the app via a license, the user must acknowledge that she/he is using the app through a license and that certain limitations come with such use in order to respect the copyright of the software.

Conversely, the Terms and Conditions is more in depth and detailed and lets users know how they are allowed to use the app, and what they should expect from you.

The Terms and Conditions will be broken down into multiple sections addressing issues such as fees and costs, dispute resolution in the event a legal dispute arises from either party and information on prohibited behavior and issues of privacy and personal information.

Common clauses for EULA

There are a few clauses that should be included in every EULA.

These clauses address license granting, restrictions on use, infringement information, termination of licensing, and disclaimers and limitations of warranties and liability.

As mentioned, the primary purpose of an EULA is to grant a license of use for an app to an end user. Because of this, every end-user license agreements should have a section that explicitly states that a license is being granted.