Licence compliance and management
Understanding requirements
In order to establish an effective licensing strategy, it is important to understand what kinds of business activities may require a licence. There are different Intellectual Property (IP) rights and different kinds of use, for example playing music, using software or photocopying a newspaper/journal article.
Copyright can be particularly complex. An example of this is in a piece of music. This can contain rights not only for the composer, but also for the lyricist, the music publisher, the record company and the performer.
Using a registered trade mark, for example a brand name, packaging design or logo, without the permission of the rights holder is a civil infringement and may be criminal, depending on the circumstances of the case.
Thinking about what you are using, and why and how you are using it, is important.
- Businesslink
have recently published a series of short guides on the use of IP protected products etc. There are separate guides for each of the four main kinds of IP rights.
Where your business is using IP protected products then permission, usually in the form of a licence, will be required. There are some exceptions set out in law to this general rule but they do not usually apply to business use.
In terms of online content, the fact that it is posted online and easily accessible does not give you the right to use that information how you choose.
If the IP right has expired (most IP rights only last for a defined period) then no licence will be required.
If the owner of IP rights in particular products or materials has given general permission to people to use them, a licence may not be required. However, note that such permissions generally come in the form of a general licence and can have conditions attached which you will need to comply with, such as the open source software movement.
Acquiring licences
Licences are either acquired from the owner of the rights or their agent.
For copyright works, licences are mostly issued by collecting societies which represent the rights holders and will provide licences for a broad range of works. For example the Copyright Licensing Agency deals with reprographic copying (i.e. photocopying) of printed works.
Other avenues for permission and use may exist as well. For example, in relation to use of a trade mark you could enter into a Coexistence agreement.
Licence management
You can take a number of steps to ensure that your business is effectively managing its compliance with licensing requirements.
Audits
Audits can help to determine the size of the problem and identify appropriate steps to aid compliance, including the required volume of licences and possible gaps. Audits also provide an opportunity to evaluate whether you have the right licence for your business needs. It can be an opportunity for you to optimise your business resources.
Installation
Where licences have been obtained, such as software licences, it is important that the products are then installed and used in accordance with the licence terms. To support this, it is helpful to:
- collect and record all evidence of licences and entitlements to use in a secure place, so you can be confident that you have the right to use.
- perform an inventory of your computers, software and users and other relevant equipment.
- match the number of licences to actual use and ensure that the software is being used in accordance with the terms and conditions of the licence e.g. the number of users.
Checks
Regular checks can help you to ensure that your business is compliant and rectify any issues, for example by procuring additional licences, redeploying unused licences (if permitted) or reducing the number of users.
Spotlight on software - compliance and management steps
It is essential that all levels of staff including directors, Information Technology (IT) staff and users are aware of the importance of software licence compliance, and that internal software developers for the business understand the licence options and costs when developing new business applications.
Consider who authorises the purchase, how the licensing arrangements ("licences") are recorded, who carries out the installation of the software and how these processes are communicated to the employees/users. Useful questions to ask include:
- Do you have a record of the licences for all the software installed on your computers?
- Do you have an up to date, accurate inventory of all software in use in your organisation?
- Have you recently conducted a software audit and reconciled the findings with the number of licences held to ensure compliance with the licence terms?
- Are there policies and processes in place for controlling the purchase and use of software?
- Do users sign to confirm that they have been made aware of, acknowledge and understand such policies and processes?
New software development
It is important that internal software developers for the business understand the licence options and costs when developing new business applications. This will help you make better decisions about the costs and benefits of potential options. Help is often available from software publishers who offer a variety of programs to assist business in keeping up to date with any developments.