Confidential information, ideas about new products and client details are among the things which businesses do their utmost to prevent falling into the hands of third parties.
The problem with protecting information is that it can hamper the development of a business. A designer will need to give information about a new product to a manufacturer, a start-up seeking investment must provide comprehensive detail of its business model. The list is endless.
So, before you reveal your confidential information, what can you do to prevent the person you are giving it to from using it to their commercial advantage?
The answer lies in the non-disclosure agreement, or "NDA" for short. Now, I must stress that an NDA does not provide a cast iron guarantee that your information won't be misused in some way, but it gives you the best and most commercially acceptable protection. The NDA contains clear restrictions on what the recipient of confidential information can do with it.
Businesses are used to signing NDAs and many have a standard version which they use often. It gives the parties a legally enforceable contract which clearly sets out the rights, obligations and remedies which each party has.
The downside with the NDA, like any form of contract, is that to enforce the terms of what has been agreed, there will very possibly be expensive court action to resolve a dispute. Unfortunately, this is all we have, there is no other way to protect your position when disclosing anything in confidence. Well, other than not disclosing anything at all but then where would we be?
By Daniel Gardener
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