Creating Confidentiality & Non-Disclosure Agreements
In business, it’s sometimes necessary to create a confidentiality contract or non-disclosure agreement (NDA) to ensure your intellectual property, data and financial information is protected, and you have recourse for unauthorised breaches of such information.
Crombie Wilkinson can help to draft confidentiality agreements and non-disclosure agreements that protect the interests of both your company and external parties.
Contact Company and Commercial Lawyers today.
Difference between confidentiality agreements & non-disclosure agreements
Confidentiality agreements and NDAs are two different types of contracts serving similar but separate purposes.
1.Confidentiality agreements
Confidentiality agreements are designed to apply to multiple scenarios like business transactions, partnerships, employment contracts and collaborations. They prevent disclosures but can also control how information is used. They cover broader sets of obligations beyond preventing disclosure, including proper handling, storage and permitted uses of information.
2.Non-disclosure agreements (NDAs)
Non-disclosure agreements are more narrow in focus, as they are designed specifically to prevent the disclosure of proprietary data, trade discrepancies, and intellectual property during business-to-business dealings like mergers and acquisitions or outsourcing.
Their narrow scope means they tend to be more legally enforceable than confidentiality agreements, especially if they’re clearly defined and limited to specified actions.
Types of confidentiality and non-disclosure agreements
There are several contract types for confidentiality contracts. The most common are:
- Unilateral (one way): Only one of the two parties is disclosing confidential information in this contract, and the receiving party agrees not to disclose or misuse that information. Typically used for employment contracts, business negotiations, and when sharing proprietary information with investors or shareholders.
- Bilateral (mutual): When both parties share confidential information with one another. It ensures both parties agree to protect the other’s sensitive information. Typically used in joint ventures, partnerships, and collaborations.
What to include in your confidentiality contract
There are many variations for confidentiality agreements and non-disclosure agreements. They will be specific to your business and the transaction you’re undertaking, but here are the essentials:
- Clarification of confidential information: The contract must specify what information is considered confidential, ensuring both or all parties understand their obligations and what is protected.
- Purpose of disclosure: The contract must explain why the information is being shared in the first place, e.g. business deal valuation.
- Obligations of receiving party: The contract must explain the responsibilities of the party receiving the information, including how they must protect the information.
- Confidentiality exclusions: It must also define what does not count as confidential, like publicly available or previously known information, to avoid overreaching claims.
- Confidentiality duration: It must define the length of time for which the information received by the receiving party remains confidential for, and this can be in perpetuity or for a short-term period, depending on the circumstances.
- Breach remedies: It must include the consequences of breaching the contract, including legal action, damages, or injunctive relief to prevent additional disclosures.
- Signatures of both parties: Ensure both parties sign the agreement to make it legally binding.
Use a bespoke confidentiality agreement or non-disclosure agreement
Including the above steps or downloading a standard confidentiality agreement template isn’t always the best way to proceed. It can save initial legal fees, but no template or generic contract is tailored to your business and may not incorporate all the relevant factors required for proper safeguarding.
Our team of confidentiality and NDA solicitors - including Ian Barnard, Director and Head of the Company Law Team – handle all legal elements of these contracts. We base all contracts and agreements on your unique business, ensuring all critical components are covered appropriately.
How Crombie Wilkinson can help with your confidentiality and NDA agreements
Crombie Wilkinson have vast professional experience crafting bespoke confidentiality and NDA agreements that ensure all proprietary information and business details are protected, and that in the event of an unforeseen data breach, you are protected with recourse options.
To discuss what company commercial legal advice you need for your business, please contact us or a member of our team: Ian, Richard or Kirsty.
