Non-disclosure agreement
A non-disclosure agreement can be useful in several situations. For example, if your employees have access to important company information. Or if you wish to sell your business and share confidential information with a potential buyer.
What is a non-disclosure agreement (NDA)?
A non-disclosure agreement is often also referred to as an NDA. It is also sometimes called a confidentiality agreement. It is a binding contract. The other party agrees to keep certain information to themselves and not disclose it. In other words, the other party must keep that information a secret.
What does the NDA contain?
A non-disclosure agreement contains the arrangements between you and the other party. You may draw up the agreement yourself. You need to set out at least these points:
- who are the parties involved in the agreement
- the purpose of the agreement
- which information must remain confidential, and which is not
- to what purpose the parties involved may use the information
- for how long the information must be kept confidential
- what happens if one of the parties breaches the agreement. For example, a fine or dismissal
- in the case of a fine, the amount of the fine
- signatures of all parties involved
NDA for employees
For employees, a non-disclosure agreement is usually part of the employment contract, not a separate contract. If an employee does not uphold the NDA, it is grounds for dismissal. Even if an employee leaves your company, the NDA still stands.
NDA for an investor or business partner
Do you have a good idea or an invention? And are you looking for a partner or investor to help you implement it? If you share sensitive information, there is the risk that the investor or partner will steal your idea or accidentally disclose it. A non-disclosure agreement for your idea or invention provides you with evidence in the event of a legal dispute.
NDA for a possible buyer of your company
Are you considering selling your business? Have you identified a possible buyer? If so, you will need to share confidential information, such as profit figures and your expectations for the future of your business. Ensure that this information only reaches the possible buyer and no one else. Therefore, have them sign a non-disclosure agreement. Include in the agreement that the fact that you are selling your business must remain confidential.