Indo-US JV announces the first escrow service for Indian IT companies

Chennai: EscrowTech India, an Indo-US Joint Venture between Global Business Solutions, a Chennai-based IT company and EscrowTech International, Inc, one of the foremost escrow companies, have announced the launch professional software and technology escrow services to Indian IT companies.

Announcing the launch of India operations, Sudhir Ravindran, director, EscrowTech said that the services in India would include escrow for software, source code andhnology among others for the protection of intellectual property. Other services offered would be technical verification, IP audit trail, IP archive, IP collateral and investment protection, IT evaluation and testing and IT dispute resolution.

"There is a huge market for our services in India. Indian businesses, and the technical and legal professionals who serve those businesses are increasingly aware of the value and need for software and technology escrows as well as IP archives and IP audit trails. EscrowTech India is today well positioned to take advantage of this huge opportunity" added Arun Mahadevan, marketing director.
Software and technology escrows protect prudent licensees, customers and users of software, technology, products and intellectual properties and can be adapted to fit a wide variety of situations and needs. The company's software escrows typically involve an "owner" who is the licensor, vendor or developer, at least one "beneficiary" who would be either the licensee, customer or user and EscrowTech as the escrow agent.

A software escrow protects a software licensee by ensuring that the licensee will have access to the source code (and possibly other materials) in the event that the licensor goes out of business, discontinues support of the licensed software, breaches maintenance obligations, or some other release condition occurs. The parties use a software escrow when the license is for the object code (binary form) of the software, but the licensee does not receive the source code and therefore is unable to maintain, update or enhance it. The licensee is dependent on the licensor for maintenance, updates and enhancements to the software.

Simplistically, a software escrow would work in the following way:

  • The licensor delivers a copy of the source code to an escrow agent (like EscrowTech).
  • The escrow agent holds the source code.
  • The escrow agent releases the source code to the licensee only if a release condition occurs.
  • The escrow agent returns the source code to the licensor if the escrow terminates without the occurrence of a release condition.
Deposit materials can be stored in EscrowTech India's high security, fire proof storage facility. All storage lockers have been honoured with the coveted IS:5244: 1991 mark issued by BIS (Bureau of Indian Standards).

For their disaster management, back-up and retention and security, clients can additionally choose EscrowTech's 'two site' storage facilities in the US at an additional charge. Clients choosing this additional facility would have one copy of the deposit materials stored in a dedicated, secure and electronically monitored storage facility. A second copy or set of the deposit materials is stored in EscrowTech's.

The second vault is located deep within the Rocky Mountains and combines the natural security of solid granite with advanced man-made storage and security technology.