# ERP licences in a carve-out: negotiate early instead of paying late

Why licences are the underestimated critical path in an IT carve-out and which questions should be settled before signing.

In a carve-out, it is often licensing law rather than technology that determines the timeline. Whether a divested business may continue to use its ERP is set out in the contract between seller and vendor, not in the purchase agreement.

## The questions before signing

- Does the licence agreement permit use by a company outside the group, even on a transitional basis?
- Is the vendor's consent required, and how long does it typically take?
- Which licences does the buyer need to acquire, and at what price?
- What happens to data and clients when the usage ends?

## Why this belongs in the TSA

If the TSA provides for system use that is not covered by the licence, both sides are exposed to risk. A clear provision protects buyer and seller and prevents back-claims.

## The practical route

Build the licence inventory early, involve the vendor early, assess alternatives in parallel. For smaller specialist applications, a rebuild is often faster than a licence negotiation.

> **Note:** This article is not legal advice. Licensing questions in individual cases belong with your legal department or law firm.