You should decide what your NDA covers. It could protect only information which is recorded in some form and marked ‘confidential’. It can also protect information you share in meetings or presentations.
A good NDA restricts the use of the ideas and information to a specific permitted purpose. This could be the evaluation of your idea or the discussion of a joint venture. Specify that purpose in the NDA as precisely as you can. You can always widen the permitted purpose later. You won’t be able to narrow the restriction on the use of your ideas or information later.
You should be realistic. The person you are talking to might need to share your information with others. This could be their employees or professional advisors. They may also need to copy your information for this purpose. Make sure that these disclosures to employees and professional advisers are made in confidence.
Think about how long the confidentiality should last. It’s common to see it limited to 3 or 5 years. After that time they will be able to use and disclose your information. Once information is made public in anyway, an NDA can’t be enforced.
Some information could be kept confidential forever. Examples of these are:
- non-patentable know-how
- lists of customers
- personal information about the individuals involved in a project
Some companies or organisations could ask you to sign a document agreeing that they will not have a duty to keep your ideas or information confidential. If that is the case, you need to decide whether to risk disclosing your ideas to them.
3. Types of NDAs
NDAs can be one way, PDF 18.3KB or mutual, PDF 17.4KB. Use a one-way NDA if only you are disclosing information and a mutual NDA if both parties are.
If the NDA is one-way only, it may need to be executed as a deed to make it enforceable. This is easy to do, so don’t make what should be a one-way agreement into an artificial mutual agreement.
If you and the other party to the NDA are not both in the same country, the NDA will need to state which law governs the agreement. Remember England and Wales have a different legal system to Scotland. It will also need to state in which courts it can be enforced. It is important that the courts of one country are not given exclusive jurisdiction. You may want to enforce the NDA in a different country if an unauthorised disclosure is made there.
4. Before your meeting
Don’t disclose your ideas or information until the recipient has signed and returned the NDA to you. Without an NDA, you are taking the risk that others could use your ideas or information without your permission.
Always check any NDA which another party asks you to sign. Make sure it doesn’t unfairly restrict your future activities.
You could ask your potential partner or advisor if they have an NDA you could both use. Read it carefully as it might serve their interests rather better than it serves yours. If in doubt, take professional advice.
Make sure the right person signs the NDA. This could be:
- a director of the recipient company
- an officer of the recipient institution
- someone senior who has authority to give the undertakings in the NDA
5. During your meeting
You should record what you disclose at meetings or in presentations. Ask people present to sign a paper copy of a presentation, or a technical drawing to prove they have seen it.
Record what information you disclose in informal situations such as discussions or conversations. Note when and where that took place.
6. NDAs and public authorities
Public authorities, including universities, have to make information available to the public if they receive a specific type of request:
- the Freedom of Information Act 2000
- the Freedom of Information (Scotland) Act 2002
- the Environmental Information Regulations 2004 (the FOIA)
You should make sure your NDA excludes these kinds of requests if you are talking to a public authority or university.
7. Further help
The IPO have developed a free online tool called the IP Health Check.
https://www.ipo.gov.uk/ip-support
This will help you identify the necessary practical and legal steps to keep your ideas and information confidential.
ONE-WAY NDA SAMPLE
Non-Disclosure Agreement
Date: 201[ ] Parties: [NAME OF INDIVIDUAL RECEIVING INFORMATION] of [address of individual] OR [NAME OF COMPANY RECEIVING INFORMATION], a company registered in [England] under company number [number on Register of Companies] whose registered office is at [address of office on the Register of Companies] (the Recipient) and [NAME OF INDIVIDUAL DISCLOSING INFORMATION] of [address of individual] OR [NAME OF COMPANY DISCLOSING INFORMATION], a company registered in [England] under company number [number on Register of Companies] whose registered office is at [address of office on the Register of Companies] (the Discloser) 1. The Discloser intends to disclose information (the Confidential Information) to the Recipient for the purpose of [insert details e.g. discussing the possibility of the Recipient and the Discloser entering into a joint venture] (the Purpose). 2. The Recipient undertakes not to use the Confidential Information for any purpose except the Purpose, without first obtaining the written agreement of the Discloser. 3. The Recipient undertakes to keep the Confidential Information secure and not to disclose it to any third party [except to its employees [and professional advisers] who need to know the same for the Purpose, who know they owe a duty of confidence to the Discloser and who are bound by obligations equivalent to those in clause 2 above and this clause 3. 4. The undertakings in clauses 2 and 3 above apply to all of the information disclosed by the Discloser to the Recipient, regardless of the way or form in which it is disclosed or recorded but they do not apply to: a) any information which is or in future comes into the public domain (unless as a result of the breach of this Agreement); or b) any information which is already known to the Recipient and which was not subject to any obligation of confidence before it was disclosed to the Recipient by the Discloser. 5. Nothing in this Agreement will prevent the Recipient from making any disclosure of the Confidential Information required by law or by any competent authority. 6. The Recipient will, on request from the Discloser, return all copies and records of the Confidential Information to the Discloser and will not retain any copies or records of the Confidential Information. 7. Neither this Agreement nor the supply of any information grants the Recipient any licence, interest or right in respect of any intellectual property rights of the Discloser except the right to copy the Confidential Information solely for the Purpose. 8. The undertakings in clauses 2 and 3 will continue in force [indefinitely.] [for [insert number] years from the date of this Agreement.] 9. This Agreement is governed by, and is to be construed in accordance with, English law. The English Courts will have non-exclusive jurisdiction to deal with any dispute which has arisen or may arise out of, or in connection with, this Agreement. If the Recipient is an individual Signed and Delivered as a Deed by: [name of Recipient] in the presence of: _____________________________ Signature _____________________________ Signature of witness _____________________________ Name of witness _____________________________ _____________________________ _____________________________ Address of witness If the Recipient is a company Executed and Delivered as a Deed by [name of Recipient] acting by [name of director], a director, in the presence of: _____________________________ Signature of Director _____________________________ Signature of witness _____________________________ Name of witness _____________________________ _____________________________ _____________________________ Address of witness