Software as a Service Agreement – how do I draft the intellectual property clause?

Summarise with: ChatGPT Claude Perplexity Microsoft Copilot

---

Table of Contents

• Licensing
• Variations to the software
• Conclusion

Intellectual property is one of the most valuable properties that your business has in relation to the software that you have created. Other intellectual property that you may want to protect includes your website, any apps you have developed and other documentation such as templates, guides or other materials you provide to users through your software.

Licensing

When drafting your intellectual property clause in your Software as Service (“SaaS”) agreement, it is important that you grant the user with a licence to use the software during their subscription and that the user provides you with a licence to use any of their content required for you to provide the service. You should provide a non-exclusive, revocable licence for the user to use any intellectual property that is involved in using the service, as well as provide a separate licence for the user to use the software. On the completion or termination of the subscription, both of these licences should be revoked.

Variations to the software

You should also include a clause that addresses a modification or change to the software by a user. A user may want to modify the software but they should first have to seek permission for example they may want to use your software to develop their own related or dependent software. You should include a clause which allows for this but that states that any variation of the software must be made by written agreement between the two parties and may be subject to a further agreement.

As addressed in your software subscription and account clause, you will licence the use of the software to the user but they must keep up their subscription fee to ensure that have the licence to use the software. The user should agree for you use, copy, transmit, store and back-up their information and data for the purposes of enabling them to access and use the software and any other activities required for the delivery of the service.

It is the responsibility of the user to maintain copies of all their data which is uploaded or entered into the software and to maintain their own intellectual property. You should endeavour to protect them from data loss by having a variety of back-up systems but you should outline that you do not have responsibility for any failure of a third party system which results in the loss of the data or restricts access to the software.

Conclusion

As a new software business it is important that you protect your intellectual property and ensure that your customers can be provided with the guidelines to protect their own intellectual property and data. The lawyers at LegalVision have extensive experience in IT and with all types of software agreements. We can draft a thorough SaaS agreement which will protect your valuable intellectual property and business interests. We have assisted many software companies to expand and grow their business and protect their intellectual property so if you’re in need of legal advice, contact us on 1300 544 755 and speak with one of our experienced IT solicitors.