NON-DISCLOSURE AGREEMENT

A legal agreement where the Parties entering into a contract where they promise do not disclose any sensitive and confidential information to any other unauthorized person or a 3rd person is called a non-disclosure agreement. It is a legally binding agreement between 2 or more parties, who for the completion of a specific purpose are required to maintain the confidentiality of the information as it may be sensitive in nature and disclosing such information may be detrimental 2 either of the parties. The non-disclosure agreement is governed by the Indian contract act, 1872. For the validity offend I am and for its in-force meant a stamp is mandatory on the agreement. an employee will be held liable for a criminal breach of trust if he or she is misusing confidential information.

Unilateral NDA, bilateral NDA, and multilateral NDA are 3 types of a non-disclosure agreement. Unilateral NDA involves 2 parties, where only one party shares the confidential matte. The party who discloses the sensitive and confidential matter is called the disclosing party and another party who receives the confidential matter is called the receiving party. Bilateral NDA involves 2 parties where both parties share confidential information, so both will be disclosing as well as receiving the sensitive and confidential matter. So, the parties are disclosing as well as receiving parties. Multilateral NDA involves 3 or more parties there only one party discloses the confidential information and the other parties agree to not disclose the confidential information which they have received. Here one of the parties who is disclosing the confidential information will be disclosing the party and the others who are receiving the confidential information will be receiving parties.

There are many types of non-disclosure agreements, for example, attorney-client NDA, real estate NDA, doctor-patient India, bank customer NDA, and employee NDA. Non-disclosure agreement Also go by other names such as confidential information agreement (CID), Secrecy agreement (SA), And confidential agreement (CA).

Start-ups, individuals, entities, companies, large corporations who want to start new business or partnership relations, enterprises etcetera usually enter into a non-disclosure agreement. The NDA protects confidential information such as trade secrets and whoever breaches the agreement has to face legal penalties.

There are some major elements that are essential in a non-disclosure agreement, as one should always keep in mind while drafting a non-disclosure agreement that it needs to be clear, neat, and short with proper labeling. The essentials are names of the parties to the agreement, the date of entering into the agreement, and the date of the execution of the agreement needs to be written clearly to avoid confusion. the purpose of entering into a non-disclosure agreement needs to be mentioned in the agreement so that one cannot misinterpret it. A non-disclosure agreement should have the duties and obligations of the parties. The non-disclosure agreement should also have the definition of the confidential matter and what is considered as confidential matter or information as not every single disclosure can be confidential. A non-disclosure agreement should have some exceptions where the receiving party is disclosing the confidential information will not be held liable For the bridge of the agreement, for example, if the information is required by the court. The non-disclosure agreement should also mention the time period involved or the term of NDA which is generally 2 to 5 and Which can also be extended as decided by the parties. The non-disclosure agreement should also have the consequences of a breach and relief. The methods for dispute resolution and what jurisdiction it lies within should also need to be mentioned in the NDA.

When a company sharing confidential information like trade secret they should enter into a non-disclosure agreement, also when the freelancers are hired in a company for a specific job and after the completion, they leave, as we are not attached to one company it is important that one enters in a non-disclosure agreement if any confidential information is shared with freelancers, For example, if the freelancer is working as a market expert or is developing as software for the company, for this kind of work confidential information is usually required so one must enter into a non-disclosure agreement. When a company is hiring employees, they should enter into an NDA with them, employee agreement usually contains the clause for non-disclosure of any confidential matter from off company. During merging or selling or acquiring another company, the confidential information of the companies distributed, so it is important to avoid any risk and enter into a non-disclosure agreement. Even during the licensing negotiation and while working with potential investors it is important to create a non-disclosure agreement.

Though the registration of a non-disclosure agreement is not mandatory as per the act, one should stamp and registered an NDA in case any dispute arises, it will be easier to prove the case and the validity and enforceability of the document. Registration act 1908 deals with the registration of a non-disclosure agreement, and one can go to the registration office to register the same. The fees of registration and stamp differ in every state.

Just like registration notarization is also not compulsory, however, it is advisable to the parties if they wish to further validate and enforce the agreement, they can notarize it in a new tree public. Again, the fees differ in every state period.

A witness can provide for further validation of the agreement; however, a witness is not required.

As per the limitation act 1963, there are 3 years for any contractual breach. And this applies to court proceedings only and not if the party has an arbitration clause or any other proceedings like tribunal or election tribunal or Labor Court etc.

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.