> I know that they can't use the product but is is against the TOS or other licensing rule?
Have you enabled shared computer activation for Microsoft 365 Apps for enterprise on RDS server?
If so, the users without licenses assigned indeed could not use the Microsoft 365 apps. When they open the Office apps, they have no licensed account to log in to activate Office.
In my opinion, this behavior above designed by Microsoft is to prevent breaking some licensing rules.
But please note, we are mainly responsible for general issues of Office desktop applications, any issue related to license requirements please contact Microsoft directly to have a affirmance.
Thanks for your understanding.
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