What is a Non Disclosure Agreement (NDA)?

A Non-Disclosure Agreement (NDA), often referred to  as Confidentiality Agreement in the UK, is a contract to protect confidential information.

Non Disclosure Agreement (NDA) Template

How to create a Non Disclosure Agreement (NDA)

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What Does NDA Mean?

NDA stands for Non-Disclosure Agreement. By signing an NDA, a party agrees not to disclose, use, or exploit confidential information except in approved circumstances or with the other party’s consent. It also specifies the duration for the confidentiality obligations to apply.

When to Sign an NDA

NDAs are very popular in the corporate world to safely protect client information and keep company data and future goals private from the external environment. NDAs help an individual or businesses safeguard their data.

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What’s in a Standard NDA?

A well-drafted NDA will include:

Information about the parties

The specific names of the parties involved.

Purpose of the NDA contract

The purpose of an NDA is the heart of the agreement. You will be giving or receiving confidential information in connection with a specific transaction like a deal, sale or investment, so it is essential that you make it clear that you are sharing the sensitive information for only that specific purpose and not for more general use. 

The time period for confidentiality

NDAs can be set in ‘perpetuity’ which would means that they run effectively forever. It’s much more common thought to set an expiration date of either the period of the transaction (plus some time afterwards for example 6 months), or for a fixed term for example 2 years. After this time, the confidential information is destroyed, returned (less common in a digital world) or erased.

Definition of confidential information

This is naturally very important. You must spend time getting this right – it may even be necessary to itemise specific data if it is very complex or if information needs to be shared but not in full.

What is a mutual NDA?

There are 3 main types of NDA you might be asked to sign The most common is a mutual NDA in which both you and the counterparty are disclosing confidential information and you both agree to protect that information to the best of your abilities. You may also sign disclosure or recipient NDAs. As the names suggest, these agreements are when information is disclosed only by one of the parties, and you are either the discloser (giving the information) or the recipient (the party receiving the confidential information).

What happens if you break a Non-Disclosure Agreement?

Breaching the terms of an NDA is a serious breach of your confidentiality obligations under the agreement. NDAs are important legal agreements that parties sign to protect valuable IP and trade secrets. Breach is taken very seriously and you must take all suitable steps to safeguard the information you receive and ensure your team does the same.

A Non-Disclosure Agreement helps any organization maintain confidentiality and privacy. A data breach could damage future goals and business plans.

Zegal’s NDA template will help protect your sensitive data. We also have lawyers on hand who can help you get the correct legal information when you need it.

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