Using arcpy results in "The tool is not licensed" error message

Symptom

Python Exception <ExecuteError>: Failed to execute. Parameters are not valid.
ERROR 000824: The tool is not licensed.
Failed to execute ({modulename}).

The python code may or may NOT run fine in Jupyter Notebooks or other Esri Applications. This is a good indication of an Esri License level mismatch.
 

Cause

Some Arcpy modules, for example, management tools, required an Advanced license and a Basic license does not include these tools or extensions.   We recommend speaking to an Esri Representative to determine what licensing level is appropriate for your needs.

Example python code that requires an elevated license:
arcpy.management.Copy(sdefullPath, sdefullPath2)
 

Resolution

FME Desktop and ArcGIS Pro

In an FME Desktop environment, changing the ArcGIS Pro to an Advanced license (from Basic) will often rectify the problem.  It is not clear if the Standard license will work in all cases but it can be tested to confirm if it permits the use of the module, tool, or extension in question. This article discusses "Accessing licenses and extensions in Python" and may help determine the required license level. The article, ArcGIS Pro license levels indicates the features available for each license level but it is not clear what modules, tools, or extensions are included in the licensing levels.  Speak to an Esri representative for more information.
 

FME Server and ArcGIS Server (ArcGIS Enterprise)

In an FME Server environment, changing the ArcGIS Server License to Advance from Basic will likely rectify the problem.  There appear to be several licensing roles that can affect what modules, tools, or extensions are licensed for use.  Please speak to an Esri representative and review this article (ArcGIS Server licensing roles) to ensure the ArcGIS Server is correctly licensed for your needs. 
 

Comments

The issue mentioned above has not been reported to Safe Software Support very often.  However, with the recent Esri licensing updates that require ArcGIS Server/Enterprise to be used with FME Server, we have indicated that a Basic license is sufficient for FME's purposes and this is correct for most scenarios involving the Readers and Writers for Geodatabase SDE & File Geodatabase formats.  If your organization makes use of Arcpy in FME Server, you may need to ensure ArcGIS Server/Enterprise has an Advanced license. 

Thorough testing is recommended before making any changes to a Production environment where you may be removing the Esri Desktop products and installing Esri Server products to be onside with your Esri Licensing agreement.  Please review Master Agreements; Products and Services Terms of Use and Using FME Server with Esri ArcGIS Software for more information.