8

we have two organizations - one for profit and one non-profit, that are related. The Non-profit benefits from use of Slack, GSuite and other tools at a discount due to the non-profit nature of the organization.

The for profit organization is donating resource time, office space to the non-profit.

In this case, would the non-profit be allowed to 'license' the use of the SaaS to the for profit (in exchange for the office space, resources, technical help, etc)? I imagine that the main problem would be in the T&C of these tools (Slack/Gsuite for non profits, etc), but could not find anything myself.

Thanks! Brian

4
  • 15
    Not that even if you could sublicense the software to the for-profit, if it were given "in exchange for the office space, resources, technical help, etc.", then those services would no longer be donations to the non-profit. If you're asking about non-profit status in the USA, you should be very careful about fudging things between two related entities, one non- and one for profit. The IRS doesn't like it. Some orgs get away with this kind of hanky-panky, but that's either by carefully staying just inside the lines or they are lucky to be overlooked. – Todd Wilcox Aug 12 '20 at 5:55
  • Thanks @ToddWilcox! This is something to consider - also, as per Nate's answer, it also goes against the T&C of the services... – cobin123 Aug 12 '20 at 18:11
  • I feel compelled to point out that gsuite and slack together are like $10 a month. You probably pay the people for whom those licenses go between $3-6k a month. You save yourself a lot of headaches by just paying the licenses. They're pretty darned cheap compared to the people employed by the for-profit organization. – corsiKa Aug 13 '20 at 3:44
  • LOL of course not... – user91988 Aug 13 '20 at 14:17
25

You can't grant or license that which is not yours.

For example, the Slack terms of service say:

We grant to Customer a non-sublicensable, non-transferable, non-exclusive, limited license for Customer and its Authorized Users to use the object code version of these components, but solely as necessary to use the Services and in accordance with the Contract and the User Terms.

So Slack's agreement with Org A does not give A any right to let any other organization B use the software. It does not matter how A and B are related, nor whether B is nonprofit or for-profit, nor what A would be getting in exchange. If B wants to use it, they need to make their own agreement with Slack.

4
  • 2
    In a different situation, "Customer" could be defined to include affiliates. Then the relationship between an X and a Y would matter. – George White Aug 11 '20 at 19:37
  • 5
    @GeorgeWhite If the two organisations are close enough to count as affiliates, they're probably too close for the non-profit to qualify for a discount. – TripeHound Aug 12 '20 at 11:09
  • 2
    That is exactly why I said "in a different situation"; to address the blanket " It does not matter how A and B are related" – George White Aug 12 '20 at 15:13
  • Thank you Nate (and everyone as well!) This makes it pretty clear - it's what we expected as well. – cobin123 Aug 12 '20 at 18:10

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.