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Non Disclosure Agreements

EM Law are experts in drafting, negotiating and advising clients on different types of non disclosure agreement. Our lead contracts lawyer is Neil Williamson who has extensive experience in advising clients on a wide range of commercial law matters.

Purpose of non disclosure agreements

Non disclosure agreements, also known as confidentiality agreements, aim to ensure the following:

  • Preservation of confidentiality.

Confidential information disclosed under the agreement remains confidential and kept secret.

  • Use for defined purpose only.

The recipient of confidential information agrees that it will not use the information for any purpose that is not set out in the confidentiality agreement.

The discloser should be aware that a non disclosure agreement cannot provide an absolute guarantee that the disclosed information will be protected. A non disclosure agreement has limitations, particularly where the recipient has little intention of complying with its obligations under the agreement. If a recipient uses or discloses confidential information in breach of the non disclosure agreement, it may be too late, or at the very least, prohibitively expensive, for the discloser to seek a meaningful remedy:

An injunction (to stop any unauthorised disclosure or use of the information) is the first choice of remedy if the discloser discovers the recipient’s intentions before it breaches the non disclosure agreement. After the breach, an injunction may be of little or no use. Once the information has entered the public domain, there is no legal remedy that will make it secret again.

Remedies for breach and practical steps

A non disclosure agreement offers certain protections but be aware of their limitations.

  • Damages for breach of contract (or a claim for an account of profits where the recipient has made use of the information) may not be an adequate remedy, especially where the confidential information has potential future value rather than value today.
  • Proving that there has been a breach of confidentiality agreement can often be difficult.
  • Even where the recipient is honest and acting in good faith, it will inevitably be influenced by the disclosed confidential information, whatever the terms of the non disclosure agreement.

Given these limitations, a discloser should, in addition to entering into the agreement, put practical measures in place to protect the information. For example, disclosing only what is absolutely necessary, providing hard copies of information only, or limiting the number of individuals who may receive the information.

Public interest considerations

In certain circumstances, public interest considerations may override confidentiality obligations. For example, where the disclosed information reveals details of crime or torts committed by the provider of the information.

For any questions you may have concerning a non disclosure agreement contact Neil Williamson.

EM Law Neil Williamson

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