[vc_row type=”in_container” full_screen_row_position=”middle” scene_position=”center” text_color=”dark” text_align=”left” overlay_strength=”0.3″ shape_divider_position=”bottom”][vc_column column_padding=”no-extra-padding” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_shadow=”none” column_border_radius=”none” width=”1/1″ tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid”][vc_column_text]An NDA (non-disclosure agreement) is used by companies to limit what one or more parties can make public about a business transaction or union. There are in fact seven essential terms that each NDA should include.
Many companies that are inexperienced in working with NDAs often turn to boilerplate documentation. These more impersonal methods of creating your NDA can lead to vital information being missed, so it’s always prudent to draw up your NDA with the help of a solicitor. Here are the seven aspects every NDA needs to cover:
Your NDA must outline clearly which parties it covers and refers to. Ensure that each participant is named and has agreed to the NDA. This will ensure you have accurate documentation should a breach be in question.
2. Definitions and interpretation
It’s vital that each party be fully informed on exactly what the NDA is protecting and how. There should be agreement among all parties so that no misapprehensions occur. This section will also carefully describe each term used in the NDA and outline exactly what is to be deemed confidential.
3. Obligations of confidentiality
Arguably the most essential part of your NDA; you must outline the obligations of confidentiality so that each party is entirely clear on what they are to do, and not to do, in regards to your NDA. This section should also outline how a breach might be caused, and how it could be remedied.
4. Return of information clauses
A return of information clause is a necessary clause for ensuring the whereabouts of the confidential information is always known by the Discloser, a return of information clause ensures information is returned to the Discloser as and when requested.
5. Term and termination
This section should outline precisely how long each party is expected to adhere to the NDA, and exactly when, if ever, the confidential nature of the information is terminated. This is especially important for NDAs which protect a subject matter that is time sensitive or coincides with a public event. Typical time limits range between two and five years.
6. Entire agreement clauses
In including this in your NDA, you are ensuring that each party recognises that, by agreeing to and signing the contract, the whole agreement is classified. This provides that, should a breach occur, no party will be able to say that they only agreed to one or two clauses within the contract.
7. Governing jurisdiction
Finally, it’s important to detail which laws the contract will fall under. This is often overlooked by many organisations drawing up an NDA, which is why a knowledgeable legal team is an invaluable help when drawing up such contracts.