What is a NDA?
Posted on 26th October 2020 at 06:41
What is an NDA (Non-disclosure agreement)?
In business, there are various reasons where there might be a need to share confidential information with another party. However, it is important to make sure that the information stays confidential and safe, and the other party does not leak, use for other purposes or share this with a third party. One way to protect the information is through an NDA.
An NDA, also known as a non-disclosure agreement, is a written contract between two parties, which creates a confidential relationship forbidding the sharing of private information. There are several instances where an NDA can be useful. In business, this kind of agreement lets the parties share confidential information without fear that it will be leaked or misused by its competitors. Companies may also ask their employees to sign an NDA to ensure that they do not share any private or sensitive information to others.
NDA’s can be customized to any extent as per the interest of the parties, and the kind of information covered by an NDA is virtually infinite. The data that is protected through NDA may compromise a marketing strategy, details about a new product to be launched, sales plan, trade secrets, details of clients, a manufacturing process, or any other sensitive information.
An NDA is a lawfully binding agreement, and if one party breaches it, the other party may seek court actions against the party breaching the agreement to ensure sure there are no further leaks and request financial compensations.
Irrespective of its purpose or the information it secures, the NDA should comprise some precise details including definitions of the confidential information, miscellaneous provisions, exclusions from confidentiality, and the name of the parties and periods.
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