contract-law licensing open-source-software
How are open source licenses valid without consideration?
<p>I'm not a lawyer or law student in any capacity, but I've read in multiple sources that a contract is not valid unless there is <em>consideration</em> for both parties.</p>

<p>With this in mind, how can licenses for free and open-source software be considered valid? There is no consideration for the developer.</p>

<p><sub>I'm interested in all western jurisdictions (e.g. US, EU) but if your answer focuses on just one that's more than fine.</sub></p>

<p>According to US law, the GPL is a license, not a contract. This means it is valid without consideration, it also means if you are in violation of the license, then you are committing copyright infringement, instead of being in breach of a contract. </p>

<p>In Germany, the GPL is a contract. And that's fine, because German law doesn't require consideration for a contract to be valid. It's interesting in that the GPL license doesn't require you to state whether you agree to the license/contract or not. But if you don't agree to the contract then there is no contract, and you have no right to use the software. </p>

<p>If I allow you to use my pen, I can withdraw that permission. If I have a contract with you to use my pen for a year, and you pay be $5, I cannot withdraw that permission. "Consideration" does not have to be money, it can be anything of value. By including some "consideration" language (I allow you to use my stuff if you do something non-monetary that is worth something to me, like distribute my software), then you have a contract. <a href="https://www.law.gmu.edu/assets/files/publications/working_papers/1223ALicenseisNot.pdf" rel="nofollow noreferrer">This article</a> discusses the problem of bare licenses and copyright, in particular with making irrevocability more iron-clad via contract.</p>

<p><a href="https://law.stackexchange.com/questions/51045/free-conditional-permission-service-contract-or-not">Except</a> for common law jurisdictions, a license does not need to be a contract to be valid. A license can be just a permission subject to conditions.</p>

<p>If I allow you to borrow my pen to fill in a form that is a license. If you do not return the pen to me after finishing with the form, you are in breach of the license and I can demand the pen back.</p>

<p>Same with many open source licenses: you are just allowed to use the software for free subject to conditions.</p>

<p>It's true that a "mere license" does not need to be supported by consideration. But that's not the case with open source licenses. They're not mere licenses.</p>

<p>Open source software licences are legally binding. One of the reasons for that is because person provides consideration (the legal expressions is "consideration moves from the promisee"). Consideration doesn't need to be money.</p>

<p>Taking one of the most basic linceses, <a href="https://opensource.org/licenses/BSD-2-Clause" rel="nofollow noreferrer">BSD-2 License</a> as an example:</p>

<ol>
<li>consideration of the developer(s): supplying a copy of the source code. The BSD-2 says: "THIS SOFTWARE IS PROVIDED BY THE COPYRIGHT HOLDERS AND ..."</li>
<li>consideration of the licensee: to adhere to the conditions of receiving the source code, which appears in clauses 1 and 2. There is further consideration in the limitations of liability, in the last paragraph of the licence.</li>
</ol>

<p>There's a synopsis of consideration <a href="https://hallellis.co.uk/references/contractual-consideration/" rel="nofollow noreferrer">here</a> which may help. </p>

<h2><a href="https://www.australiancontractlaw.com/law/formation-consideration.html" rel="nofollow noreferrer">Consideration</a> is not (necessarily) money</h2>

<p>While the most common type of contract is the supply of goods and services (as consideration) on one side in return for the payment of money (as consideration) on the other it doesn't have to be that way. A promise to do or refrain from doing <em>anything</em><sup>1</sup> is good consideration. <strong>A licence contains both.</strong></p>

<p>The licensor promises not to sue the licensee for copyright (say) infringement in return for the licensee promising to do and not do the things in the terms. Consideration is provided on both sides.</p>

<p>There is a <a href="https://www.technollama.co.uk/a-licence-or-a-contract" rel="nofollow noreferrer">mistaken</a> belief that a commercial<sup>2</sup> licence is somehow different from a contract - a licence <strong>is</strong> a contract. If a person wants to give something away - they have to give it away. A gift with conditions subsequent attached is not a gift - requiring someone to only use your "gift" in accordance with some rules makes it not a gift.</p>

<p><sup>1</sup> Subject to the usual restraints: illegal acts are not good consideration, things already required by law are not good consideration etc.</p>

<p><sup>2</sup> Governments also issue licences - to drive, to operate a business etc. - these are not the same as commercial licences and are not contracts.</p>
