Q&As

Is it legally possible to ‘pass through’ warranties and indemnities from a third party software licensor to the eventual licensee? If so, how?

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Produced in partnership with Craig Armstrong of Shoosmiths
Published on LexisPSL on 11/10/2017

The following TMT Q&A produced in partnership with Craig Armstrong of Shoosmiths provides comprehensive and up to date legal information covering:

  • Is it legally possible to ‘pass through’ warranties and indemnities from a third party software licensor to the eventual licensee? If so, how?

The answer to this Q&A is based on standard contractual principles, rather than any software-specific legislation and focuses on an arrangement under which a licensor of software engages a reseller to distribute software to end-users.

Typically, a software reseller will have an arrangement with the licensor whereby either:

  1. the reseller puts in place an end user licence agreement (EULA) between the end user and the licensor. The content (and typically the form) of the EULA is dictated by the licensor and typically the EULA is not negotiated by the end user, or

  2. the reseller enters into a direct sublicence with the end user which flows down the provisions of the reseller’s agreement with the licensor

The approach of putting in place a EULA between the licensor and the end user, effectively removing the reseller from the equation, is a common approach adopted by the large software licensors such as Microsoft, SAP and Oracle. The benefit of this approach is that it gives the licensor direct control over the content of the EULA, including the scope of the software warranty and any indemnity protection (typically being indemnity protection in respect of a third par

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