diff --git a/apps/web/app/(app)/environments/[environmentId]/components/EnvironmentLayout.tsx b/apps/web/app/(app)/environments/[environmentId]/components/EnvironmentLayout.tsx
index 0813457b16..e2c56efbad 100644
--- a/apps/web/app/(app)/environments/[environmentId]/components/EnvironmentLayout.tsx
+++ b/apps/web/app/(app)/environments/[environmentId]/components/EnvironmentLayout.tsx
@@ -1,7 +1,7 @@
 import { MainNavigation } from "@/app/(app)/environments/[environmentId]/components/MainNavigation";
 import { TopControlBar } from "@/app/(app)/environments/[environmentId]/components/TopControlBar";
 import type { Session } from "next-auth";
-import { getEnterpriseLicense, getIsMultiOrgEnabled } from "@formbricks/ee/lib/service";
+import { getEnterpriseLicense } from "@formbricks/ee/lib/service";
 import { IS_FORMBRICKS_CLOUD } from "@formbricks/lib/constants";
 import { getEnvironment, getEnvironments } from "@formbricks/lib/environment/service";
 import { getMembershipByUserIdOrganizationId } from "@formbricks/lib/membership/service";
@@ -15,6 +15,7 @@ import { getProducts } from "@formbricks/lib/product/service";
 import { DevEnvironmentBanner } from "@formbricks/ui/DevEnvironmentBanner";
 import { ErrorComponent } from "@formbricks/ui/ErrorComponent";
 import { LimitsReachedBanner } from "@formbricks/ui/LimitsReachedBanner";
+import { PendingDowngradeBanner } from "@formbricks/ui/PendingDowngradeBanner";
 
 interface EnvironmentLayoutProps {
   environmentId: string;
@@ -43,10 +44,7 @@ export const EnvironmentLayout = async ({ environmentId, session, children }: En
   }
 
   const currentUserMembership = await getMembershipByUserIdOrganizationId(session?.user.id, organization.id);
-  // const isMultiOrgEnabled = await getIsMultiOrgEnabled();
-  // const isMultiOrgEnabled = true;
-  const { features, message: licenseErrorMessage } = await getEnterpriseLicense();
-  console.log({ features, licenseErrorMessage });
+  const { features, lastChecked, isPendingDowngrade, active } = await getEnterpriseLicense();
 
   const isMultiOrgEnabled = features?.isMultiOrgEnabled ?? false;
 
@@ -70,7 +68,11 @@ export const EnvironmentLayout = async ({ environmentId, session, children }: En
         />
       )}
 
-      {licenseErrorMessage && <div className="bg-red-500 p-4 text-white">{licenseErrorMessage}</div>}
+      <PendingDowngradeBanner
+        lastChecked={lastChecked}
+        isPendingDowngrade={isPendingDowngrade ?? false}
+        active={active}
+      />
 
       <div className="flex h-full">
         <MainNavigation
diff --git a/apps/web/app/(app)/environments/[environmentId]/settings/(organization)/enterprise/page.tsx b/apps/web/app/(app)/environments/[environmentId]/settings/(organization)/enterprise/page.tsx
index edf96214ac..fc60e83eff 100644
--- a/apps/web/app/(app)/environments/[environmentId]/settings/(organization)/enterprise/page.tsx
+++ b/apps/web/app/(app)/environments/[environmentId]/settings/(organization)/enterprise/page.tsx
@@ -2,7 +2,7 @@ import { OrganizationSettingsNavbar } from "@/app/(app)/environments/[environmen
 import { CheckIcon } from "lucide-react";
 import { getServerSession } from "next-auth";
 import { notFound } from "next/navigation";
-import { getIsEnterpriseEdition } from "@formbricks/ee/lib/service";
+import { getEnterpriseLicense } from "@formbricks/ee/lib/service";
 import { authOptions } from "@formbricks/lib/authOptions";
 import { IS_FORMBRICKS_CLOUD } from "@formbricks/lib/constants";
 import { getMembershipByUserIdOrganizationId } from "@formbricks/lib/membership/service";
@@ -37,7 +37,7 @@ const Page = async ({ params }) => {
     notFound();
   }
 
-  const isEnterpriseEdition = await getIsEnterpriseEdition();
+  const { active: isEnterpriseEdition } = await getEnterpriseLicense();
 
   const paidFeatures = [
     {
@@ -166,7 +166,7 @@ const Page = async ({ params }) => {
                   </li>
                 ))}
               </ul>
-              <p className="my-6 text-sm  text-slate-700">
+              <p className="my-6 text-sm text-slate-700">
                 No call needed, no strings attached: Request a free 30-day trial license to test all features
                 by filling out this form:
               </p>
@@ -176,7 +176,7 @@ const Page = async ({ params }) => {
                 target="_blank">
                 Request 30-day Trial License
               </Button>
-              <p className="mt-2 text-xs  text-slate-500">No credit card. No sales call. Just test it :)</p>
+              <p className="mt-2 text-xs text-slate-500">No credit card. No sales call. Just test it :)</p>
             </div>
           </div>
         </div>
diff --git a/packages/ee/lib/service.ts b/packages/ee/lib/service.ts
index 8043ea8248..73bd8feadd 100644
--- a/packages/ee/lib/service.ts
+++ b/packages/ee/lib/service.ts
@@ -24,7 +24,6 @@ const getPreviousResult = (): Promise<{
   active: boolean | null;
   lastChecked: Date;
   features: TEnterpriseLicenseFeatures | null;
-  message?: string;
 }> =>
   cache(
     async () => ({
@@ -44,17 +43,15 @@ const setPreviousResult = async (previousResult: {
   active: boolean | null;
   lastChecked: Date;
   features: TEnterpriseLicenseFeatures | null;
-  message?: string;
 }) => {
   revalidateTag(PREVIOUS_RESULTS_CACHE_TAG_KEY);
-  const { lastChecked, active, features, message } = previousResult;
+  const { lastChecked, active, features } = previousResult;
 
   await cache(
     async () => ({
       active,
       lastChecked,
       features,
-      message,
     }),
     [PREVIOUS_RESULTS_CACHE_TAG_KEY],
     {
@@ -92,70 +89,86 @@ const fetchLicenseForE2ETesting = async (): Promise<{
   }
 };
 
-export const getIsEnterpriseEdition = async (): Promise<boolean> => {
+export const getEnterpriseLicense = async (): Promise<{
+  active: boolean;
+  features: TEnterpriseLicenseFeatures | null;
+  lastChecked: Date;
+  isPendingDowngrade?: boolean;
+}> => {
   if (!ENTERPRISE_LICENSE_KEY || ENTERPRISE_LICENSE_KEY.length === 0) {
-    return false;
+    return {
+      active: false,
+      features: null,
+      lastChecked: new Date(),
+    };
   }
 
   if (E2E_TESTING) {
     const previousResult = await fetchLicenseForE2ETesting();
-    return previousResult && previousResult.active !== null ? previousResult.active : false;
+    // return previousResult && previousResult.active !== null ? previousResult.active : false;
+    return {
+      active: previousResult ? previousResult.active : false,
+      features: previousResult ? previousResult.features : null,
+      lastChecked: previousResult ? previousResult.lastChecked : new Date(),
+    };
   }
 
   // if the server responds with a boolean, we return it
   // if the server errors, we return null
   // null signifies an error
   const license = await fetchLicense();
-  console.log({ license });
+
   const isValid = license ? license.status === "active" : null;
   const threeDaysInMillis = 3 * 24 * 60 * 60 * 1000;
   const currentTime = new Date();
-  let message = "";
 
   const previousResult = await getPreviousResult();
-  console.log({ previousResult });
+
   if (previousResult.active === null) {
     if (isValid === null) {
-      await setPreviousResult({
+      const newResult = {
         active: false,
         features: { isMultiOrgEnabled: false },
         lastChecked: new Date(),
-      });
-      return false;
+      };
+
+      await setPreviousResult(newResult);
+      return newResult;
     }
   }
 
   if (isValid !== null && license) {
-    await setPreviousResult({ active: isValid, features: license.features, lastChecked: new Date() });
-    return isValid;
+    const newResult = {
+      active: isValid,
+      features: license.features,
+      lastChecked: new Date(),
+    };
+
+    await setPreviousResult(newResult);
+    return newResult;
   } else {
     // if result is undefined -> error
     // if the last check was less than 72 hours, return the previous value:
 
     const elapsedTime = currentTime.getTime() - previousResult.lastChecked.getTime();
-    if (elapsedTime <= threeDaysInMillis) {
-      message = `We were unable to verify your license because the license server is unreachable. You will be downgraded to the Community Edition on ${new Date(previousResult.lastChecked.getTime() + threeDaysInMillis).toISOString()}.`;
-    } else {
-      message =
-        "We have been unable to verify your license because the license server has been unreachable for more than 3 days in a row. You have been downgraded to Community Edition.";
-    }
-
-    const newActive = elapsedTime <= threeDaysInMillis ? previousResult.active : false;
-    if (previousResult.active !== newActive || previousResult.message !== message) {
-      const newResult = {
-        ...previousResult,
-        active: newActive,
-        message,
+    if (elapsedTime < threeDaysInMillis) {
+      return {
+        active: previousResult.active !== null ? previousResult.active : false,
+        features: previousResult.features,
+        lastChecked: previousResult.lastChecked,
+        isPendingDowngrade: true,
       };
-      await setPreviousResult(newResult);
     }
 
     // Log error only after 72 hours
-    if (elapsedTime > threeDaysInMillis) {
-      console.error("Error while checking license: The license check failed");
-    }
+    console.error("Error while checking license: The license check failed");
 
-    return newActive;
+    return {
+      active: false,
+      features: null,
+      lastChecked: previousResult.lastChecked,
+      isPendingDowngrade: true,
+    };
   }
 };
 
@@ -170,25 +183,6 @@ export const getLicenseFeatures = async (): Promise<TEnterpriseLicenseFeatures |
   }
 };
 
-export const getEnterpriseLicense = async (): Promise<{
-  active: boolean;
-  features?: TEnterpriseLicenseFeatures;
-  message?: string;
-}> => {
-  const previousResult = await getPreviousResult();
-  if (previousResult) {
-    return previousResult;
-  } else {
-    const license = await fetchLicense();
-
-    return {
-      active: license ? license.status === "active" : false,
-      features: license ? license.features : undefined,
-      message: "",
-    };
-  }
-};
-
 export const fetchLicense = async (): Promise<TEnterpriseLicenseDetails | null> =>
   await cache(
     async () => {
@@ -210,7 +204,7 @@ export const fetchLicense = async (): Promise<TEnterpriseLicenseDetails | null>
         const proxyUrl = env.HTTPS_PROXY || env.HTTP_PROXY;
         const agent = proxyUrl ? new HttpsProxyAgent(proxyUrl) : undefined;
 
-        const res = await fetch("https://ee.formbricxks.com/api/licenses/check", {
+        const res = await fetch("https://ee.formbricks.com/api/licenses/check", {
           body: JSON.stringify({
             licenseKey: ENTERPRISE_LICENSE_KEY,
             usage: { responseCount: responseCount },
@@ -255,7 +249,7 @@ export const getRoleManagementPermission = async (organization: TOrganization):
       organization.billing.plan === PRODUCT_FEATURE_KEYS.SCALE ||
       organization.billing.plan === PRODUCT_FEATURE_KEYS.ENTERPRISE
     );
-  else if (!IS_FORMBRICKS_CLOUD) return await getIsEnterpriseEdition();
+  else if (!IS_FORMBRICKS_CLOUD) return (await getEnterpriseLicense()).active;
   return false;
 };
 
@@ -265,13 +259,13 @@ export const getAdvancedTargetingPermission = async (organization: TOrganization
       organization.billing.plan === PRODUCT_FEATURE_KEYS.SCALE ||
       organization.billing.plan === PRODUCT_FEATURE_KEYS.ENTERPRISE
     );
-  else if (!IS_FORMBRICKS_CLOUD) return await getIsEnterpriseEdition();
+  else if (!IS_FORMBRICKS_CLOUD) return (await getEnterpriseLicense()).active;
   else return false;
 };
 
 export const getBiggerUploadFileSizePermission = async (organization: TOrganization): Promise<boolean> => {
   if (IS_FORMBRICKS_CLOUD) return organization.billing.plan !== PRODUCT_FEATURE_KEYS.FREE;
-  else if (!IS_FORMBRICKS_CLOUD) return await getIsEnterpriseEdition();
+  else if (!IS_FORMBRICKS_CLOUD) return (await getEnterpriseLicense()).active;
   return false;
 };
 
@@ -285,7 +279,7 @@ export const getMultiLanguagePermission = async (organization: TOrganization): P
       organization.billing.plan === PRODUCT_FEATURE_KEYS.SCALE ||
       organization.billing.plan === PRODUCT_FEATURE_KEYS.ENTERPRISE
     );
-  else if (!IS_FORMBRICKS_CLOUD) return await getIsEnterpriseEdition();
+  else if (!IS_FORMBRICKS_CLOUD) return (await getEnterpriseLicense()).active;
   return false;
 };
 
diff --git a/packages/ui/PendingDowngradeBanner/index.tsx b/packages/ui/PendingDowngradeBanner/index.tsx
new file mode 100644
index 0000000000..8df73f6413
--- /dev/null
+++ b/packages/ui/PendingDowngradeBanner/index.tsx
@@ -0,0 +1,45 @@
+interface PendingDowngradeBannerProps {
+  lastChecked: Date;
+  active: boolean;
+  isPendingDowngrade: boolean;
+}
+
+export const PendingDowngradeBanner = ({
+  lastChecked,
+  active,
+  isPendingDowngrade,
+}: PendingDowngradeBannerProps) => {
+  const threeDaysInMillis = 3 * 24 * 60 * 60 * 1000;
+
+  const isLastCheckedWithin72Hours = lastChecked
+    ? new Date().getTime() - lastChecked.getTime() < threeDaysInMillis
+    : false;
+
+  const scheduledDowngradeDate = new Date(lastChecked.getTime() + threeDaysInMillis);
+
+  if (active) {
+    if (isPendingDowngrade && isLastCheckedWithin72Hours) {
+      return (
+        <>
+          <div className="z-40 flex h-5 items-center justify-center bg-orange-800 text-center text-xs text-white">
+            We were unable to verify your license because the license server is unreachable. You will be
+            downgraded to the Community Edition on {scheduledDowngradeDate.toLocaleDateString()}
+          </div>
+        </>
+      );
+    }
+  }
+
+  if (isPendingDowngrade && !isLastCheckedWithin72Hours) {
+    return (
+      <>
+        <div className="z-40 flex h-5 items-center justify-center bg-orange-800 text-center text-xs text-white">
+          We were unable to verify your license because the license server is unreachable. You are downgraded
+          to the Community Edition.
+        </div>
+      </>
+    );
+  }
+
+  return null;
+};