Licensing Law Definition

A license or permit is an offical authorization to do something that the person would not be entitled to do without the license or permit. License fees may be imposed, but must be reasonable and not so expensive as to prevent persons from the right to pursue a trade or occupation. Licensing may be used to raise revenue or to fund the regulation of activities. Any qualifications attached to the issuance of the license must meet constitutional due process requirements and not be discriminative. Training, educational, or financial responsibility qualifications may be required. Background information on the applicant may be required when reasonably related to the issuance of the license and not based upon discriminatory reasons.

The issuance of a license may also be conditioned on the action of other government agencies, such as requiring a state license before the applicant will be allowed a local license, or requiring other agencies, such as police, fire, and health departments, to approve the application before the license will issue.

Intellectual property, such as patents, can also be licensed. This is often little more than a promise not to sue, e.g., if royalties are paid. For example, an End User License Agreement (EULA) is a contract found in most software packages that describes the rights to which the user of the software is entitled. Typically, it will explain how many people can use the software, whether it can be used on multiple machines, and whether it is transferable.