Key Legal Issues In Software Escrow Agreements: A Guide For Licensors And Licensees

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Software escrow is a mechanism through which a software's source code is deposited with a neutral third-party escrow agent. This is commonly used in licensing arrangements.

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Software escrow is a mechanism through which a software's source code is deposited with a neutral third-party escrow agent. This is commonly used in licensing arrangements where the licensee wants to ensure they can maintain and operate the software if the licensor becomes unable or unwilling to provide ongoing support or maintenance. The escrow agreement sets out the conditions under which the source code will be released to the licensee.

Understanding the intricacies of software escrow agreements is crucial for both licensors and licensees, who have distinct concerns when entering these agreements. Below, we delve into the key legal issues from both perspectives.

For the Licensor: Protecting Intellectual Property

As a licensor, your primary concern is safeguarding your intellectual property. Key legal considerations include:

For the Licensee: Ensuring Continuity of Business Operations

As a licensee, your main concern is ensuring that your business operations remain uninterrupted. Important legal issues to consider are:

Mutual Concerns: Aligning Licensor and Licensee Interests

Both parties should pay attention to:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.