What is an NDA?

An Non-Disclosure Agreement is a legally enforceable agreement between two parties to keep particular information private. The information might be disclosed throughout the course of employment, a commercial transaction, or an interview. NDAs can be “mutual” (both parties need to secure secret information) or “one-way” (only one side is disclosing confidential information). The receiving party is commonly referred to as the “receiving party.”

In any case, if someone who has agreed to keep confidential material private violates the NDA, the other party may seek injunctive action to prevent the publication of information and recover damages, which may include lost profits.

What information does an NDA protect?

An NDA can be used to safeguard any company knowledge that offers you a competitive advantage but is not widely recognized.

Examples of potentially protected information include:

➤ Shared inventions, invention plans, or goods with a colleague, partner, potential partner, independent contractor (such as a freelance writer employed to produce a grant application or proposal), investor, or buyer
➤ Business plans, financial data, marketing materials, and other sensitive information are offered to a collaborator, potential partner, independent contractor, investor, or buyer
➤ Employees were given ideas for future marketing materials, webpages, blogs, and so on
➤ Employees utilized or partially built copyrighted software programs, or other technology was disclosed with a possible buyer or licensee
➤ Employees or collaborators, including independent contractors employed by the company, may have access to confidential and sensitive information
➤ Information, plans, ideas, and so on developed inside a working group, such as while developing a computer or other technology application
➤ Formulas, recipes, and other chemical combinations
Do small businesses need NDAs in Singapore?

What are the parts of an NDA?

Make certain that any NDA you draft includes the following provisions:

1. Protected and excluded confidential information:

You must safeguard any sensitive information that is important to your company; you must be as explicit as possible without, of course, divulging the secrets in an NDA. Excluded items are based on legal principles; material that cannot be regarded secret includes that which the receiving party has developed or already knows.

2. Receiving party obligations:

In general, the receiving party cannot expose the secret information in question and must limit its use. There may be specific occasions where using sensitive information is permissible; an NDA should identify such, as well as the acceptable method of disclosure.

3. Breach consequences:

An NDA should include a provision stating that you can seek injunctive action and damages in the event of a breach.

4. Length of agreement:

Although many firms would prefer their secrets to remain hidden forever, an NDA should contain a time restriction, usually five years from the date of signature, but this is optional.

5. Method of dispute resolution:

An NDA should clarify which state’s law will apply, whether arbitration will be employed, and whether the winning party will be entitled to legal costs in the event of a violation or disagreement about the agreement.

There’s a strong possibility that what makes your company distinctive is also what makes it successful. Confidentiality may be the key to the success of your firm, whether you have an inventive business strategy, a secret recipe, or a remarkable innovation.

Get your Non-disclosure Agreement drafted to your need as a small business

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