Non Disclosure Agreement NDA
A non-disclosure agreement (NDA) is a legal contract that states certain information to be confidential and the extent to which its disclosure is restricted to third parties. It can be entered into with a person or an organization.
Confidential information includes trade secrets, business plans, business methods and strategies, drawings, charts, and so on. Software programs and code are also included in the category of confidential information. Consultants and agencies are usually asked to sign one to protect trade secrets as they mostly work with multiple organizations within the same industry.
Types of Non-Disclosure Agreements
- One-way or unilateral agreement - Here, only one party has the confidential information to be shared with another party. The party in possession is called the ‘disclosing party’ and the other one is named the ‘receiving party’.
- Two-way or bilateral agreement - Here, two parties are involved and both have the confidential information to be shared.
- Multilateral agreement - Here, 3 or more parties are involved. One of them discloses sensitive or confidential information and the others promise to protect such information from further disclosures.
Benefits of a Non-Disclosure Agreement
Protects Business Secrets
An NDA is one of the most common ways to protect trade secrets and other confidential information. Consultants and agencies are usually asked to sign one to protect trade secrets.
Enhances Client Relationships
Businesses that work on third-party projects require their employees to sign NDAs, to restrict the use and disclosure of confidential information, and assure clients that their data is safe.
What Should a Non-Disclosure Agreement Include?
A valid non-disclosure agreement should include the following key provisions-
This section will mention if the nondisclosure agreement is a unilateral, bilateral, or multilateral one. The details of the party/parties (names, addresses, etc) involved should be mentioned in this part.
Term of the Agreement
The nondisclosure agreement template must mention the date of execution of the agreement and the duration of the existence of the same. It should also mention if the rules and obligations related to disclosure of information will be applicable after the expiry of the nondisclosure agreement or not.
The non-disclosure agreement format must specify what information is to be kept in the ‘confidential’ category or to be protected.
Disclosure of Confidentiality
This section of the non-disclosure agreement specifies the intentions for which the confidential data/information will be used. It will also specify with whom such information can be shared.
The non-disclosure agreement must mention the remedial measures the parties will resort to, to resolve disputes, if any. It will include alternative forms of dispute resolution they may choose to employ, such as arbitration.
Process of Preparing a Non-Disclosure Agreement at Vakilsearch
- Step 1: Once you send in a request, our representative will get in touch with you to understand your requirements
- Step 2: If we require more details, we will contact you for the same
- Step 3: Once these are received, we will work on the request and send the non-disclosure agreement format for your review within 3 to 4 working days
Note: In case you would like any changes to the non-disclosure agreement format, our lawyers will work on them. Two rounds of iterations are included in the original price.