diff --git a/config/.decisions.yml b/config/.decisions.yml
index 2327b2d17a1..273796f3912 100644
--- a/config/.decisions.yml
+++ b/config/.decisions.yml
@@ -23,7 +23,7 @@
 - - :whitelist
   - MIT
   - :who: Connor Shea
-    :why: Compatible with itself.
+    :why: http://choosealicense.com/licenses/mit/
     :versions: []
     :when: 2016-04-17 21:12:24.558441000 Z
 - - :whitelist
diff --git a/doc/development/README.md b/doc/development/README.md
index aa7d54c01d0..cf1bd493a9f 100644
--- a/doc/development/README.md
+++ b/doc/development/README.md
@@ -7,9 +7,11 @@
 - [Gotchas](gotchas.md) to avoid
 - [How to dump production data to staging](db_dump.md)
 - [Instrumentation](instrumentation.md)
+- [Licensing](licensing.md) for ensuring license compliance
 - [Migration Style Guide](migration_style_guide.md) for creating safe migrations
 - [Performance guidelines](performance.md)
 - [Rake tasks](rake_tasks.md) for development
+- [SCSS Style Guide](scss_styleguide.md)
 - [Shell commands](shell_commands.md) in the GitLab codebase
 - [Sidekiq debugging](sidekiq_debugging.md)
 - [SQL guidelines](sql.md) for SQL guidelines
diff --git a/doc/development/licensing.md b/doc/development/licensing.md
new file mode 100644
index 00000000000..87841f8c39b
--- /dev/null
+++ b/doc/development/licensing.md
@@ -0,0 +1,57 @@
+# GitLab Licensing and Compatibility
+
+GitLab CE is licensed under the terms of the MIT License. GitLab EE is licensed under "The GitLab Enterprise Edition (EE) license" wherein there are more restrictions. See their respective LICENSE files ([CE][CE], [EE][EE]) for more information.
+
+## Automated Testing
+
+In order to comply with the terms the libraries we use are licensed under, we have to make sure to check new gems for compatible licenses whenever they're added. To automate this process, we use the [license_finder][license_finder] gem by Pivotal. It runs every time a new commit is pushed and verifies that all gems in the bundle use a license that doesn't conflict with the licensing of either GitLab Community Edition or GitLab Enterprise Edition.
+
+There are some limitations with the automated testing, however. CSS and JavaScript libraries, as well as any Ruby libraries not included by way of Bundler, must be verified manually and independently. Take care whenever one such library is used, as automated tests won't catch problematic licenses from them.
+
+Some gems may not include their license information in their `gemspec` file. These won't be detected by License Finder, and will have to be verified manually. [License Finder's README][license_finder] includes information and guidance on manually adding a gem's license. Make sure to include a link to the library's license in the "why" section.
+
+## Acceptable Licenses
+
+The following are licenses which are acceptable to use:
+
+- [The MIT License][MIT] (the MIT Expat License specifically): The MIT License requires that the license itself is included with all copies of the source. It is a permissive (non-copyleft) license as defined by the Open Source Initiative.
+- [LGPL][LGPL] (version 2, version 3): GPL constraints regarding modification and redistribution under the same license are not required of projects using an LGPL library, only upon modification of the LGPL-licensed library itself.
+- [Apache 2.0 License][apache-2]: A permissive license that also provides an express grant of patent rights from contributors to users.
+- [Ruby 1.8 License][ruby-1.8]: Dual-licensed under either itself or the GPLv2, defer to the Ruby License itself. Acceptable because of point 3b: "You may distribute the software in object code or binary form, provided that you do at least ONE of the following: b) accompany the distribution with the machine-readable source of the software."
+- [Ruby 1.9 License][ruby-1.9]: Dual-licensed under either itself or the BSD 2-Clause License, defer to BSD 2-Clause.
+- [BSD 2-Clause License][BSD-2-Clause]: A permissive (non-copyleft) license as defined by the Open Source Initiative.
+- [BSD 3-Clause License][BSD-3-Clause] (also known as New BSD or Modified BSD): A permissive (non-copyleft) license as defined by the Open Source Initiative
+- [ISC License][ISC] (also known as the OpenBSD License): A permissive (non-copyleft) license as defined by the Open Source Initiative.
+
+## Unacceptable Licenses
+
+The following are licenses which are *not* acceptable to use:
+
+- [GNU GPL][GPL] (version 1, [version 2][GPLv2], [version 3][GPLv3], or any future versions): GPL-licensed libraries cannot be linked to from non-GPL projects.
+- [GNU AGPLv3][AGPLv3]: AGPL-licensed libraries cannot be linked to from non-GPL projects.
+
+## Notes
+
+If a gem uses a license which is not listed above, open an issue and ask. If a license is not included in the "acceptable" list, operate under the assumption that it is not acceptable.
+
+Keep in mind that each license has its own restrictions (typically defined in their body text). Please make sure to comply with those restrictions at all times whenever an external library is used.
+
+Gems which are included only in the "development" or "test" groups by Bundler are exempt from license requirements, as they're not distributed for use in production.
+
+**NOTE:** This document is **not** legal advice, nor is it comprehensive. It should not be taken as such.
+
+[CE]: https://gitlab.com/gitlab-org/gitlab-ce/blob/master/LICENSE
+[EE]: https://gitlab.com/gitlab-org/gitlab-ee/blob/master/LICENSE
+[license_finder]: https://github.com/pivotal/LicenseFinder
+[MIT]: http://choosealicense.com/licenses/mit/
+[LGPL]: http://choosealicense.com/licenses/lgpl-3.0/
+[apache-2]: http://choosealicense.com/licenses/apache-2.0/
+[ruby-1.8]: https://github.com/ruby/ruby/blob/ruby_1_8_6/COPYING
+[ruby-1.9]: https://www.ruby-lang.org/en/about/license.txt
+[BSD-2-Clause]: https://opensource.org/licenses/BSD-2-Clause
+[BSD-3-Clause]: https://opensource.org/licenses/BSD-3-Clause
+[ISC]: https://opensource.org/licenses/ISC
+[GPL]: http://choosealicense.com/licenses/gpl-3.0/
+[GPLv2]: http://www.gnu.org/licenses/gpl-2.0.txt
+[GPLv3]: http://www.gnu.org/licenses/gpl-3.0.txt
+[AGPLv3]: http://choosealicense.com/licenses/agpl-3.0/