An NDA (Non-Disclosure Agreement) is a confidential agreement between two or more parties regarding the nondisclosure of each other’s confidential information. The use of NDA is very common in businesses where the technology involved in making the product is patented and the disclosure of any strategic information to an outsider/ business partner may hamper the business prospects of that company.
How to define the confidential information?
Defining the confidential information is the most crucial step in an NDA because there is a very thin line dividing the ordinary information from the confidential information. The confidential information must be defined in a manner to cover its scope, extent, and nature.
What is the usefulness of Non-Disclosure Agreement (NDA)?
In order to keep information regarding sales reports, clients list, business concept and various business models confidential and prevent the secrets from getting divulged, it is crucial to ascertain a criterion to hold the party liable which steals the secrets. This is where NDA’s come into play with their compelling role in maintaining the confidentiality of documents and information.
After an NDA is signed, two parties can freely enter into negotiations regarding their respective business deals. The deliberation that takes place between the parties in order to arrive at a proposed agreement is termed as negotiation. Negotiations hold a major role in getting the licenses for a business for e.g.: technology license, patent license etc.
What excludes the applicability of Non-Disclosure Agreement NDA?
i. when the information provided is already available in the public domain.
ii. when the recipient already knows about the information.
iii. when a product/service or a business idea is independently developed by a recipient without the use of any confidential information provided by the disclosing party.
iv. When the government orders the release of confidential information if it is needed to fulfill some compliance or regulation.
How many kinds of Non-Disclosure Agreements are there?
i. One sided NDA is when only when one party is disclosing the confidential information and the opposite party is merely receiving information.
ii. Two sided NDA is when both the parties are disclosing their confidential information to each other. So an NDA is signed by both the parties promising not to disclose or use each other’s business secrets. It is also known as a bilateral NDA.
iii. Multilateral NDA is when there are more than two parties involved in sharing/receiving the information.
How can you have your own customized Non-Disclosure Agreement?
The answer is Docket Tech Solutions. We take great pride in building a document which satisfies all the requirements of our customers. All you have to do is click Non-Disclosure Agreement and you shall have the readied document in no time. Please read ahead to understand the critical points one should ideally cover in an NDA.
How long does a Non-Disclosure Agreement last?
Usually, NDA’s last for infinity but its duration shouldn’t be so long that it leads to an unduly burden on the recipient. The agreement shouldn’t create infinite boundaries which restrict the growth of recipient. Also once the negotiations are over, the confidential information received through all means must be destroyed and the proof of its destruction must be shown to the disclosing party.
What are the legal measures available?
NDA’s have a provision wherein the court can put restraining orders on the infringing party. Along with restraining order, the party breached by the infringement may also ask for monetary damages which are ascertained through the proportionate method.
Another way by which disputes can be resolved is through the process of arbitration. Before an NDA is signed the parties to an NDA which could be either two or more should mutually decide the arbitration seat. The governing law of the contract should also be mentioned which can exercise control on the business transactions at the time and after the negotiations are over.
What are some most important responsibilities of an ideal recipient of confidential information?
i. Not using the information disclosed by the opposite party to its own business advantage and operations.
ii. Not disclosing the information which may hamper the business prospects of the disclosing party.
iii. Ensuring the protection of secrecy to take all necessary steps to maintain the confidentiality.
Who possesses the ownership of confidential information once it is divulged with the recipient?
The ownership of all the confidential information for e.g. the novel idea of a business product shall remain solely with the discloser and the ownership doesn’t get transferred by a mere transfer of information.
A well-drafted NDA can prevent you from being misused at the hands of your potential business partner, clients or employees too. Go ahead and order one with Docket Tech Solutions – The Document Expert.