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License Requirements by Control

License mapping guidance for the current FSI Agent Governance Framework control catalog.


License Summary

License Controls Requiring Primary Use
Power Platform Premium 1.1, 1.4, 1.8, 1.14, 1.20, 2.1, 2.2, 2.3, 2.5, 2.8, 2.9, 2.15, 2.24, 3.2, 3.5, 3.6, 3.7, 3.8 Managed Environments, ACP, PPAC governance
Microsoft 365 E5 1.5, 1.6, 1.7, 1.9, 1.10, 1.12, 1.13, 1.17, 1.19, 1.21, 1.22, 3.14 Purview full suite
Microsoft Purview Suite (formerly M365 E5 Compliance) 1.5, 1.6, 1.7, 1.9, 1.10, 1.12, 1.13, 1.17, 1.19, 1.22, 3.14 Purview add-on to E3
Microsoft 365 E3 1.3, 1.11, 1.15, 1.16, 2.10 Basic security features
Microsoft Entra ID P1 1.11, 1.18, 2.8, 2.26 Conditional Access, Agent ID governance
Microsoft Entra ID P2 1.11, 1.12, 1.23, 2.26, 4.2 PIM, Access Reviews, Agent ID Protection
Microsoft Entra Internet Access 1.29 Global Secure Access, Secure Web and AI Gateway
SharePoint Advanced Management 4.1, 4.2, 4.3, 4.4, 4.5, 4.6 SharePoint governance
Copilot Studio All Agent development
Microsoft 365 Copilot 2.24, 3.8 Copilot experiences and first-party agents
Microsoft Agent 365 (per-user) 1.8, 1.21, 1.24, 2.24, 2.25, 2.26, 3.8, 3.13, 3.14 Agent control plane, registry, analytics, identity, observability. See Note A below.
Windows 365 for Agents W365A scope (touchpoints: 1.7, 1.20, 1.29, 2.25) Agent Cloud PC execution. GA the week of June 1, 2026. See Note B below.
Microsoft 365 Copilot Business N/A SMB Copilot access

Agent 365 and GSA licensing references

Microsoft Agent 365 overview states that Microsoft Agent 365 is generally available on a per-user basis and recommends (not requires) Entra P1, Entra P2, or Entra Suite together with Purview DLP. Microsoft Learn also states that agent network controls use Microsoft Entra Internet Access, included in Microsoft Entra Suite or licensed standalone. Microsoft Agent 365 is available standalone (per-user) or as part of Microsoft 365 E7, which bundles Microsoft 365 E5 + Microsoft 365 Copilot + Microsoft Entra Suite + Microsoft Agent 365. Confirm the exact entitlements for your tenant against the current Microsoft licensing and service-description documentation. See Microsoft Agent 365 overview, Microsoft Entra Agent ID licensing, and Global Secure Access licensing overview.

Note A — Defender → Agent 365 transition (July 1, 2026): As of July 1, 2026, AI agent security capabilities for Microsoft Copilot Studio and Microsoft Foundry agents in Microsoft Defender (agent discovery, posture, threat detection, Advanced Hunting) require a Microsoft Agent 365 license — these are no longer covered by Defender for Cloud Apps or Defender for Cloud alone. This transition adds Controls 1.21 and 1.24 to the Agent-365-gated set. See Transition agent security to Agent 365.

Note B — Windows 365 for Agents (W365A) prerequisites: Generally available the week of June 1, 2026 (What's new in Windows 365 for Agents). Requires Windows 365 or Agent 365 tenant licensing plus an active W365A billing plan. Confirm current region availability against Microsoft Learn before deploying.


Microsoft 365 Copilot Business

SMB-Focused Copilot License (GA December 2025)

Microsoft 365 Copilot Business is designed for smaller organizations (up to 300 users) and became generally available December 1, 2025.

Aspect Details
Price $21/user/month
User Limit Up to 300 users per tenant
GA Date December 1, 2025
Prerequisites Microsoft 365 Business Basic, Standard, Premium, or Apps for Business

Key Differences from Enterprise Copilot:

Capability Copilot Business Microsoft 365 Copilot
User limit 300 maximum Unlimited
Base license M365 Business SKUs M365 E3/E5
Microsoft Copilot Studio Included (limited) Full Copilot Studio
Advanced compliance Basic Full Purview integration

FSI Applicability: Smaller broker-dealers, RIAs, or credit unions with under 300 users may find this SKU more cost-effective than enterprise licensing. However, organizations with significant regulatory compliance requirements (FINRA 4511 long-term retention, comprehensive audit) should evaluate whether Microsoft Purview Suite features are necessary before selecting the Business SKU.


E5 License Distinction: E5 vs Microsoft Purview Suite vs Microsoft Defender Suite

These Are Three Distinct Products

Microsoft 365 E5, Microsoft Purview Suite, and Microsoft Defender Suite are separate products with different feature sets. Documentation must be precise about which is required. Microsoft Purview Suite was formerly named "Microsoft 365 E5 Compliance" (renamed October 2025); Microsoft Defender Suite was formerly named "Microsoft 365 E5 Security" (renamed October 2025); older documentation and admin portals may still use the previous names.

License What It Includes Typical Use Case
Microsoft 365 E5 Full suite: E3 + Purview Suite + Microsoft Defender Suite + additional services Enterprise with comprehensive needs
Microsoft Purview Suite (formerly E5 Compliance) Microsoft Purview suite (DLP, IRM, eDiscovery, Insider Risk, etc.) Organizations with E3 needing compliance
Microsoft Defender Suite (formerly Microsoft 365 E5 Security) Microsoft Defender suite (Defender for Office 365 P2, Defender for Endpoint P2, etc.) Organizations with E3 needing security

Key Distinctions:

Capability E5 Purview Suite Defender Suite
Microsoft Purview DLP
Microsoft Purview DSPM for AI
Microsoft Purview Insider Risk
Microsoft Purview eDiscovery
Microsoft Defender for Office 365 P2
Microsoft Defender for Endpoint P2
Microsoft Defender for Cloud Apps
Microsoft Sentinel (50 MB/user/month)

Documentation Guidance: When referencing E5 requirements, specify whether Microsoft Purview Suite is sufficient (Purview features) or full E5/Microsoft Defender Suite is required (Defender features).

Copilot Control System License Language

Foundational vs Optimized

Microsoft Learn now describes Copilot Control System licensing in Foundational and Optimized tiers. Foundational controls map to Microsoft 365 admin center, SharePoint Advanced Management, and Microsoft Purview capabilities available with A3/E3/G3 licensing. Optimized controls map to Microsoft Purview and Microsoft Defender for Cloud Apps capabilities available with A5/E5/G5 licensing.

For FSI implementations, Zone 2 deployments often start with Foundational controls, while Zone 3 deployments typically need Optimized data security, insider risk, and reporting capabilities.


Pillar 1: Security Controls

Control Control Name Required License Notes
1.1 Restrict Agent Publishing Power Platform Premium Managed Environments required
1.2 Agent Registry Microsoft 365 E3+ Integrated Apps in M365 Admin
1.3 SharePoint Content Governance Microsoft 365 E3+ SharePoint included; SAM for advanced
1.4 Advanced Connector Policies Power Platform Premium Managed Environments + Environment Groups
1.5 DLP and Sensitivity Labels Microsoft 365 E5 or Microsoft Purview Suite Purview DLP + Information Protection. Note: DLP for Copilot prompts is available to all M365 Copilot/Copilot Chat users at no additional cost (any SKU); DLP to restrict Copilot from processing files/emails requires E5/Purview Suite
1.6 DSPM for AI Microsoft 365 E5 or Microsoft Purview Suite Microsoft Purview DSPM for AI
1.7 Audit Logging Microsoft 365 E5 (Premium) or E3 (Standard) E5 for 10-year retention
1.8 Runtime Protection Power Platform Premium + Microsoft Agent 365 (per-user) for AI Agent Inventory and Defender agent security from July 1, 2026 Managed Environments feature; Defender for Cloud Apps surfaces AI Agent Inventory during the grace period. Effective July 1, 2026, AI Agent Inventory and Defender agent security require Microsoft Agent 365 (see Note A above).
1.9 Data Retention Microsoft 365 E5 or Microsoft Purview Suite Data Lifecycle Management
1.10 Communication Compliance Microsoft 365 E5 or Microsoft Purview Suite Purview Communication Compliance
1.11 Conditional Access & MFA Microsoft Entra ID P1 (basic) or P2 (advanced) P2 for risk-based policies
1.12 Insider Risk Microsoft 365 E5 or E5 Insider Risk Purview Insider Risk Management
1.13 Sensitive Information Types Microsoft 365 E5 or Microsoft Purview Suite Custom SITs require E5
1.14 Data Minimization Power Platform Premium Environment-level controls
1.15 Encryption Microsoft 365 E3+ Default encryption included
1.16 IRM for Documents Microsoft 365 E3+ Azure Information Protection
1.17 Endpoint DLP Microsoft 365 E5 or Microsoft Purview Suite Endpoint DLP
1.18 RBAC Microsoft Entra ID P1+ Role management
1.19 eDiscovery for Agent Interactions Microsoft 365 E5 or Microsoft Purview Suite eDiscovery (Premium) for AI content search
1.20 Network Isolation and Private Connectivity Azure subscription + Power Platform Premium VNet integration, Private Endpoints
1.21 Adversarial Input Logging Microsoft 365 E5 or Microsoft Defender Suite (formerly E5 Security) Defender for Cloud Apps + Purview Audit
1.22 Information Barriers Microsoft 365 E5 or Microsoft Purview Suite Purview Information Barriers
1.23 Step-Up Authentication Microsoft Entra ID P2 Authentication context + Conditional Access
1.24 Defender AI-SPM Microsoft Defender for Cloud (CSPM) Defender CSPM plan required
1.25 MIME Type Restrictions Power Platform Premium Managed Environments; optional Purview DLP
1.26 Agent File Upload and File Analysis Restrictions Power Platform Premium Copilot Studio per-agent file upload controls; Purview DLP for Zone 2+
1.27 AI Agent Content Moderation Enforcement Power Platform Premium Native Copilot Studio content moderation
1.28 Policy-Based Agent Publishing Restrictions Power Platform Premium Tenant DLP policies; PPAC security scans
1.29 Global Secure Access Network Controls Microsoft Entra Internet Access Secure Web and AI Gateway for Copilot Studio agents; requires GSA onboarding and a Dataverse-backed Power Platform environment. See Secure Web and AI Gateway for agents and Note B (GSA prerequisites).

Pillar 2: Management Controls

Control Control Name Required License Notes
2.1 Managed Environments Power Platform Premium Per-environment license
2.2 Environment Groups Power Platform Premium Requires Managed Environments
2.3 Change Management Power Platform Premium ALM features
2.4 Business Continuity Microsoft 365 E3+ Documentation-focused
2.5 Testing & Validation Power Platform Premium Test environments
2.6 Model Risk Management N/A (process) Process/documentation control
2.7 Vendor Risk Management N/A (process) Process/documentation control
2.8 Access Control & SoD Microsoft Entra ID P1+ Security roles
2.9 Performance Monitoring Power Platform Premium Analytics features
2.10 Patch Management Microsoft 365 E3+ Automatic with SaaS
2.11 Bias Testing N/A (process) Process/documentation control
2.12 Supervision & Oversight Microsoft 365 E5 (for monitoring) Communication Compliance optional
2.13 Documentation & Records Microsoft 365 E3+ SharePoint/OneDrive storage
2.14 Training & Awareness Microsoft 365 E3+ Viva Learning optional
2.15 Environment Routing Power Platform Premium Managed Environments auto-provisioning
2.16 RAG Source Integrity N/A (process) Process/documentation control
2.17 Multi-Agent Orchestration Limits Copilot Studio Orchestration requires Copilot Studio
2.18 Automated Conflict of Interest N/A (process) Process/documentation control
2.19 Customer AI Disclosure N/A (process) Transparency/labeling requirement
2.20 Adversarial Testing / Red Team N/A (process) Process; optional Azure AI safety tools
2.21 AI Marketing Claims N/A (process) Process/documentation control
2.22 Inactivity Timeout Enforcement Power Platform Premium BAP Admin API for timeout configuration
2.23 User Consent and AI Disclosure Enforcement Microsoft 365 E3+ M365 Admin Center AI Disclaimer toggle
2.24 Agent Feature Enablement and Restriction Governance Power Platform Premium + Microsoft 365 Copilot; Microsoft Agent 365 (per-user) for Agent 365 admin-center governance PPAC feature governance is the Power Platform surface; M365 admin center agent-governance features vary by subscription. See Agent management in M365 admin center.
2.25 Agent 365 Governance Console GA May 1, 2026 — Microsoft Agent 365 per-user licensing AI Admin/Global Admin/Global Reader roles.
2.26 Entra Agent ID Identity Governance Entra platform available to all Entra customers; Microsoft Agent 365 (per-user) + Microsoft Entra ID P1/P2 required for agent security features The Entra Agent ID platform is available to all Entra customers. Extending security and governance features to agents requires Microsoft 365 E7 or E5 + Agent 365. Standalone options (each still needing Agent 365): CA for agents (P1), ID Protection (P2), ID Governance (P1), network controls (Entra Internet Access). See Agent ID licensing.
2.27 Consumption-Entitlement Governance Power Platform Premium + Microsoft 365 Copilot or Microsoft Agent 365 (per-user) for metered consumption surfaces Entitlement evaluation, per-agent spend caps, and policy-scope group registration. Zones 2–3 require entitlement contract evaluation and coverage-gap analysis; Zone 3 additionally requires per-agent metered spend caps. See Copilot Studio licensing.

Pillar 3: Reporting Controls

Control Control Name Required License Notes
3.1 Agent Inventory Microsoft 365 E3+ M365 Admin Center
3.2 Usage Analytics Power Platform Premium CoE Toolkit recommended
3.3 Compliance Reporting Microsoft 365 E5 Purview reports
3.4 Incident Reporting Microsoft 365 E3+ Process/documentation
3.5 Cost Allocation Power Platform Premium License tracking
3.6 Orphaned Agent Detection Power Platform Premium Managed Environments feature
3.7 PPAC Security Posture Power Platform Premium Managed Environments security dashboard
3.8 Copilot Hub Power Platform Premium + Microsoft 365 Copilot PPAC Copilot Hub plus M365 admin center agent reporting; Agent overview metrics available with Microsoft Agent 365 per-user licensing at GA
3.9 Microsoft Sentinel Integration Microsoft Sentinel + Microsoft Defender Suite (formerly E5 Security) Microsoft Sentinel workspace required
3.10 Hallucination Feedback Loop Microsoft 365 E3+ Process-focused; Purview optional
3.11 Centralized Agent Inventory Enforcement Power Platform Premium PPAC Agent Inventory feature
3.12 Agent Governance Exception and Override Management Microsoft 365 E3+ Dataverse/SharePoint exception register
3.13 Agent 365 Admin Center Analytics Microsoft Agent 365 (per-user) Agent overview hero metrics and governance cards start collecting data when Agent 365 licenses are activated; feature visibility can vary by subscription. See Agent management in Microsoft 365 admin center
3.14 Agent 365 Observability SDK Microsoft Agent 365 (per-user) + Microsoft 365 E5 or Microsoft Purview Suite for extended audit retention Observability SDK telemetry enables M365 admin center monitoring and Defender/Purview integration; Purview audit-retention licensing should be validated for regulated retention requirements. See Agent 365 Observability and Purview audit retention policies

Pillar 4: SharePoint Controls

Control Control Name Required License Notes
4.1 IAG / Restricted Content Discovery SharePoint Advanced Management + at least one Microsoft 365 Copilot license SAM required for IAG; RCD requires at least one Copilot license assigned in tenant (March 2026 prerequisite)
4.2 Site Access Reviews Microsoft Entra ID P2 + SAM Access Reviews + SAM
4.3 Retention Management Microsoft 365 E5 or Microsoft Purview Suite Data Lifecycle Management
4.4 Guest Access Controls Microsoft 365 E3+ Basic; E5 for advanced
4.5 Security Monitoring SharePoint Advanced Management + E5 SAM + Purview Audit
4.6 Grounding Scope Governance SharePoint Advanced Management Restricted SharePoint Search
4.7 M365 Copilot Data Governance Microsoft 365 E5 or Microsoft Purview Suite Purview data governance for Copilot
4.8 Item-Level Permission Scanning (Agent Knowledge Sources) SharePoint Advanced Management + Microsoft 365 E5 (or Microsoft Purview Suite) Builds on RAC/RCD/RSS (Control 4.1); DSPM for AI complements knowledge-source assessment
4.9 Embedded File Content Governance Microsoft 365 E5 or Microsoft Purview Suite Sensitivity labels / default label policy for SharePoint Embedded containers used by Agent Builder knowledge files

License Bundles for FSI

Minimum (Zone 1 Only)

  • Microsoft 365 E3
  • Power Platform per-user (standard)
  • Microsoft 365 E5 or E3 + Microsoft Purview Suite
  • Power Platform Premium (per-environment)
  • Microsoft Entra ID P1

Regulated (Zone 3)

  • Microsoft 365 E5
  • Power Platform Premium (per-environment for all production)
  • Microsoft Entra ID P2
  • SharePoint Advanced Management
  • Copilot Studio (per-user or capacity-based)

Premium Connector Licensing by Product

Copilot Studio premium connector usage is metered

Premium connector licensing varies by product. For Copilot Studio, premium connector calls are consumption-based and billed against Copilot Studio messages, prepaid message packs, or PAYG rather than being unconditionally "included." Microsoft documents the same distinction in the Power Apps / Power Automate licensing FAQ.

Product Premium Connectors Dataverse Access Notes
Copilot Studio Consumption-based (metered against Copilot Studio messages / prepaid message packs / PAYG) Included via tenant default environment baseline (3 GB database + 3 GB file + 1 GB log = 7 GB) plus per-license accruals Standalone Power Platform Premium per-user license is not required for end users when calls are metered to the agent's billing capability. Verify tenant capacity in Power Platform Admin Center
Power Apps Requires Premium license Requires Premium license Per-user or per-app licensing
Power Automate Requires Premium license Requires Premium license Per-user or per-flow licensing

Common Misconception: Teams building Copilot Studio agents do not need separate premium connector licenses for end users when premium connector calls are billed to the agent's message capacity. If the same connectors are used outside the agent billing path, standard Power Apps / Power Automate premium licensing rules still apply.

Power Apps/Power Automate Context: Premium connector and Dataverse access require Power Apps Premium, Power Apps per app, Power Automate Premium, or Power Automate per flow licenses for all accessing users.


Cost Optimization Tips

  1. Start with E3 + Add-ons: Many FSI organizations start with E3 and add Microsoft Purview Suite and Microsoft Defender Suite (formerly E5 Security) as add-ons rather than full E5.

  2. Managed Environments per Environment: Only production and UAT typically need Managed Environments; dev/test can use standard.

  3. SharePoint Advanced Management: Only required if using IAG/RCD features for Zone 3 SharePoint governance.

  4. Entra ID P2 vs P1: P2 is only required for Privileged Identity Management and Access Reviews; P1 covers Conditional Access.

  5. Copilot Studio Licensing: Consider capacity-based licensing for high-volume agent scenarios vs. per-user for limited makers.


License Verification

To verify current license assignments:

Microsoft 365 Admin Center

  1. Sign in to https://admin.microsoft.com
  2. Navigate to Billing > Licenses
  3. Review available and assigned licenses

Power Platform Admin Center

  1. Sign in to https://admin.powerplatform.microsoft.com
  2. Navigate to Manage > Environments
  3. Select an environment to view license type

Entra Admin Center

  1. Sign in to https://entra.microsoft.com
  2. Navigate to Identity > Users > Select user > Licenses
  3. Review assigned licenses

Additional Resources


Microsoft Agent 365 and Agent Management Essentials

GA note: Microsoft Agent 365 reached general availability on May 1, 2026 as Microsoft Agent 365 per-user licensing. Recommended (not required) prerequisites: Entra P1/P2/Suite + Purview DLP. Microsoft Agent 365 is also bundled in Microsoft 365 E7 (E5 + Microsoft 365 Copilot + Entra Suite + Agent 365). Confirm the exact entitlements for your tenant against the current Microsoft licensing and service-description documentation.

Defender agent security requires Microsoft Agent 365 from July 1, 2026

Defender for Cloud AI security posture management and Defender for Cloud Apps surface agent inventory during the grace period. Effective July 1, 2026, AI agent security capabilities for Microsoft Copilot Studio and Microsoft Foundry agents in Microsoft Defender — agent discovery, posture, threat detection, and Advanced Hunting — require a Microsoft Agent 365 license and are no longer covered by Defender for Cloud Apps or Defender for Cloud (transition guidance). Plan procurement before the cutover.

Official prerequisites

Requirement Official guidance Source
Tenant licensing Microsoft Agent 365 per-user licensing; assign licenses from Microsoft 365 admin center. Microsoft Agent 365 is also bundled in Microsoft 365 E7. Confirm the exact entitlements for your tenant against the current Microsoft licensing and service-description documentation. Microsoft Agent 365 overview
Day-to-day admin roles AI Admin, Global Admin, or Global Reader (view-only) can manage agents in Microsoft 365 admin center Agent prerequisites
Power Platform admin roles Power Platform Administrator or Dynamics 365 Administrator may still be needed for Copilot Studio environment administration Agent prerequisites
Sensitive role hardening Use Entra Privileged Identity Management for AI Admin and other high-privilege roles Agent prerequisites

Microsoft Agent 365 Licensing at GA

Licensing point Microsoft-published guidance
GA model (May 1, 2026) Microsoft Agent 365 — GA May 1, 2026 — Microsoft Agent 365 per-user license, standalone or bundled in Microsoft 365 E7. Recommended (not required) prerequisites: Entra P1/P2/Suite + Purview DLP. Confirm the exact entitlements for your tenant against the current Microsoft licensing and service-description documentation.
Included entitlement Agents acting on behalf of a licensed user are covered under that user's Microsoft Agent 365 per-user license.
Framework implication Per-user licensing replaces the earlier per-agent-instance Frontier preview model; plan procurement and entitlement tracking accordingly.

Control-specific interpretation

Control Licensing interpretation
1.8 - Runtime Protection Defender for Cloud Apps surfaces AI Agent Inventory during the grace period. Effective July 1, 2026, AI Agent Inventory and Defender agent security require Microsoft Agent 365; Defender for Cloud Apps / Defender for Cloud alone no longer provide them (transition guidance).
1.21 - Adversarial Input Logging Copilot Studio / Foundry agent threat detection and Advanced Hunting (Agentsinfo) in Microsoft Defender require Microsoft Agent 365 from July 1, 2026. Azure-side Defender for Cloud Threat Protection for AI Workloads (Prompt Shields plane) is licensed separately and unchanged.
1.24 - Defender AI Security Posture Management Agent-level discovery, posture, and threat detection for Copilot Studio / Foundry agents require Microsoft Agent 365 from July 1, 2026. Defender CSPM continues to discover Foundry accounts/projects, but agent-level capabilities move under Agent 365 (transition guidance).
3.7 - PPAC Security Posture Assessment Defender for Cloud Apps AI Agent Inventory cross-reference remains useful for portal walkthrough validation; from July 1, 2026 the agent-inventory dependency requires Microsoft Agent 365.
2.25 - Agent 365 Governance Console Requires Microsoft Agent 365 per-user licensing at GA (May 1, 2026).
3.8 - Copilot Hub and Governance Dashboard Power Platform Premium covers PPAC Copilot Hub; Agent overview metrics and governance cards are tied to Microsoft Agent 365 per-user licensing at GA (May 1, 2026).
2.23 - User Consent and AI Disclosure Enforcement Follow Agent Management Essentials prerequisites for AI Admin role assignment and PIM when delegating admin-center agent governance

Microsoft Agent 365 Resources


Last Updated: June-2026 | Framework Version: v1.6.2