What is a Click Wrap Agreement License

As more and more products and services become available in digital form or on the Internet this has created a dilemma with traditional terms of use agreements. Click wrap agreements have become the popular method used to finalize terms and agreements of purchase, service or product usage.

Since so many transactions are completed online nowadays, the click wrap agreement was created as an electronic solution to resolve contractual controversies that may arise in a transaction. Due to the absence of physical paper contracts that contain signatures indicating the acceptance of terms, the click wrap is an alternative way to finalize the sale with a simple click of the mouse button.

You’ve probably been exposed to many click wrap agreements if you spend any amount of time online or use software on your computer. Before you can access most digital products, services or even to obtain a membership to use some websites you often are presented with a click wrap agreement.

You’ll also notice that anytime you want to download or install software or use most other kinds of electronic media this is a requirement before the product or use can be activated. This agreement specifies to the user what they can or cannot do as a part of the terms of sale or usage.

The way click wraps work is after you read the terms of use, service or sale, at the end of the terms you will be presented with the choice “I agree” or “I don’t agree”. This will primarily come in the form of a pop-up box or a check-box depending on the design of the agreement.

If you read the terms all the way through you’ve probably noticed that the majority of the agreement will be in favor of the vendor or online entity offering the terms. This is mostly done by companies to protect intellectual property and to safeguard themselves.

The click wrap is designed to protect the company against illegal or wrongful use by the user. When a person selects “I agree”, the consumer or user consents to abide by the company’s terms. The click wrap is essentially a way to protect the company and shift responsibility to the user.

When you are presented with this decision, you’ll quickly notice that your transaction cannot be completed unless you give your consent. This means you will not be allowed access to the product or service until you agree because you have not completed the transaction by agreeing to the contractual terms.

Click wrap agreements seem to be a good alternative to the absence of paper contracts in today’s digital environment. One problem that has arisen which is associated with click wrap agreements is that companies often put too much “legalese” in their terms of use or service and as a result users and consumers have become immune to them.

As a result people quickly select “I agree” so they can continue their transaction. Unfortunately it isn’t until after the fact people sometimes realize they don’t agree with the terms and are not happy with their transaction, but are bound to the terms because they agreed.

It is always a good idea to take the time to go through any terms you may be offered and not be so hasty to select “I agree”. Perhaps someday companies will realize the problems associated with lengthy and complicated contracts and make strides to simplify the wording into layman’s terms, but the law is complicated and businesses have to cover all angles. It is often a catch-22.

Until then, we have click wraps. The good news is that once you get the hang of reading the contractual terms, some legal terminology and understand the basic framework of how click wrap agreements are structured, they become a little easier to understand. It is in your best interest to make an effort to read the terms before ever clicking “I agree”.