Owner: Brendan O’Reilly
After a combined 60+ years in the software industry, mostly working for vendors, we thought we knew our way around software licensing and contracts. When we first heard of companies selling pre-owned licences, our initial response was that it had to be illegal. Surely? Software vendors usually explicitly state in their contracts that their customers are not allowed to resell, transfer or in any way assign licences to another party. And this is the commonly held belief even amongst industry stalwarts.
What Is Pre-Owned Software?
Pre-owned software has been previously licensed to a customer(s) on a perpetual basis and subsequently has become surplus to requirements. The prior owner(s) have all the necessary documentation providing proof of purchase and have confirmed the software is no longer in use and has been deleted from their systems. Due diligence has been executed to confirm the legitimacy of re-sale and the pre-owned software licenses are thus available to be re-sold.
What does the law say?
However, EU Software Directives and the European Courts say otherwise, opening up the possibility for companies to realize significant financial windfalls by selling perpetual licences of their Microsoft “Volume” products which they no longer need. This might arise because they are migrating to cloud versions or because their organization is being restructured. On the other side of the coin, companies who prefer on-premise software for particular needs now have the option to buy pre-owned licences at a fraction of the cost of purchasing new.