Open Source Due Diligence

The use of open source code is widely used by software development companies to accelerate development and to reduce costs. The use of open source code creates challenges if the code breaches the licensing rules. There are many common open source licenses including:

  • GPL
  • LGPL
  • MPL
  • AGPL
  • GNU
  • Apache

When acquiring a technology company, as the buyer, you need to identify if there could be any underlying licensing issues with the technology. The most common issues arise from the use of open source code within the development cycle. The only way to mitigate against these potential risks is to understand exactly what code and licenses have been used to build the technology. During a M&A due diligence process, the seller will generally be hesitant to handover their source code to a potential buyer.

Escrow London is a trusted 3rd party that specializes in source code verification and audits. We can quickly analyze software and technology builds to support a M&A due diligence process.

The audit report provides a complete overview of what source code has been used, a list of open source licenses linked to this code and a review by an IP lawyer (specialist in open source technology) of the constraints and potential IP issues with utilized open source code.

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