Software License Agreement in Kenya: Template, Key Clauses and Local Law (2026)

A software license agreement is the contract that lets a user install or use software while the developer keeps ownership of it. In Kenya the agreement sits on general contract law and, most importantly, the Copyright Act, which protects computer programs as literary works. This guide sets out the clauses that matter and the local law behind them. It is written for software vendors, buyers and their legal teams. It is general guidance, not legal advice, and you should confirm the current position with a qualified Kenyan advocate. ## What a software license agreement is A licence is permission to use software without transferring ownership of it. The developer keeps the copyright and grants the user a defined right to use the software on agreed terms. This differs from a SaaS subscription, where the user accesses hosted software rather than receiving a copy, and from an assignment, where ownership actually changes hands. The central questions are: what can the user do with the software, for how long, on how many machines or users, and what is off limits. ## The law that applies in Kenya - Copyright Act. This is the key statute. It protects computer programs as literary works and is administered by the Kenya Copyright Board. Because the software is protected by copyright, the developer can control copying and use through the licence rather than selling the software outright.

• Law of Contract Act (Cap 23). This Act applies the English common law of contract in Kenya, with modifications, so offer, acceptance, consideration and intention are needed.
• Data Protection Act 2019. If the software processes personal data of people in Kenya, this Act applies, and a separate data processing agreement may be needed.
• Tax. Value Added Tax applies at 16% to software and digital services, including licences, and non-resident suppliers of digital services to Kenyan customers must register and account for VAT.
• Dispute resolution. Kenyan-facing deals usually choose Kenyan law and either the courts or arbitration under the Arbitration Act 1995. ## Key clauses to include ### Grant and scope of licence Define exactly what is granted: perpetual or term, exclusive or non-exclusive, the number of users or installations, and the permitted purpose. The narrower and clearer the grant, the fewer disputes later. ### Restrictions Set out what the user may not do: no copying beyond the licence, no sublicensing, no reverse engineering (subject to any legal exceptions), no removing proprietary notices. These restrictions are backed by the Copyright Act. ### Intellectual property ownership State plainly that the developer owns all intellectual property in the software and that the user receives only the licensed rights. Clarify ownership of any customisations. ### Delivery, acceptance and support Cover how the software is delivered, any acceptance testing, and whether maintenance, updates and support are included or sold separately. ### Fees and taxes State the licence fee, payment terms, and who bears VAT. For term licences, cover renewal. ### Warranties and IP indemnity Include a limited warranty that the software performs as described, and an indemnity protecting the user against third-party claims that the software infringes intellectual property. ### Limitation of liability Cap liability sensibly and exclude indirect loss, within the limits the law allows. ### Term, termination and effect State the term, termination rights, and what happens on termination: the user must stop using and, for installed software, remove copies. ## A simple structure to follow 1. Parties and definitions

2. Grant and scope of licence
3. Restrictions on use
4. Intellectual property ownership
5. Delivery, acceptance, maintenance and support
6. Fees, payment and VAT
7. Warranties and IP indemnity
8. Limitation of liability
9. Term, termination and effect of termination
10. Governing law and dispute resolution ## Common mistakes to avoid - A vague grant that does not say how many users, machines or sites the licence covers.

• No restrictions on copying, sublicensing or reverse engineering.
• Silence on ownership of customisations and configurations.
• No IP indemnity, leaving the user exposed to infringement claims.
• Forgetting VAT on the licence fee and who accounts for it. ## Keeping the agreement in one place A software licence keeps mattering after signing: term and renewal dates, user or seat limits, support entitlements and compliance with the restrictions all need tracking. These are easy to lose when the signed licence sits in a folder away from the people who manage renewals and usage. The idea behind a single AI contract workspace is to hold the agreement and its terms together: draft and review the licence, surface its key dates and obligations, and track them in one place rather than across email and spreadsheets. Adira is one such workspace. It is built around Indian corporate law first, and support for other jurisdictions, including Kenya, is on its roadmap, so treat the local-law points above as a starting position to confirm with a qualified Kenyan advocate.