Deposits and NCA

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Please could someone give me some good advice.

We have a business system that we "license" to operators for the use of our system. We dont want to go down the road we have of recent, so we would like to request an amount of the fee upfront as a part payment of the total fee, merely to dissuade people that are not seriously interested and other who wish to replicate our concept for free.

The "deposit" will be set off against the total price if the deal goes through and refunable if it does not.

My question is can we call it a deposit, if not what do we call it, and can we safely do it?

[sterne.law@gmail.com]

You can call it a deposit if you wish, however it is imperative that deposits are kept separately, normally in a separate bank account, as the money is not yours to use. This was specifically set out in the CPA.

It is unclear how you operate. Are you "giving" the people the system on a one month trial type situation? Thereafter they make a decision.
You could term it an advance payment and incorporate a penalty clause. Alternatively the equivalent of occupational rental.