5 Simple Steps to Writing a Non-Disclosure Agreement


If you’re dealing with confidential information or trade secrets, it’s always important to make sure that the people you’re sharing it with can be trusted to keep the information safe and secure. A confidentiality agreement (also known as a non-disclosure agreement, or NDA) keeps your business secrets secret by legally binding the recipient of the information to keep it confidential and to not disclose it without your permission.

You should have NDAs with anyone who has access to sensitive information about your business, such as a client employee, supplier, or consultant. Non-disclosure agreements are typically used in these situations, but not all non-disclosure agreements are created equal. A good non-disclosure agreement will include an explanation of what confidential information is being shared as well as the terms and conditions of who can use it and how they can use it.

A non-disclosure agreement can help you reduce your liability if confidential information is disclosed without your consent.

While they are relatively straightforward to draft, it can be hard to know where to start when you’re in the initial stages of writing one up. This guide will help you create a great non-disclosure agreement in five simple steps so that you can use it as needed in your own business transactions:

1) Know what you’re trying to protect

A confidentiality agreement is a document where the signee agrees not to disclose any of the information that you have shared with them. One of the first most important things is what is that information? Do the obligations on confidentiality extend to all information you may share with each other, or is it a specific type of data and information?

Confidentiality agreements can help protect trade secrets and ensure there are no issues with intellectual property. They are also sometimes used in sharing an ideas or inventions. A good way to think about this agreement is that it sets parameters for what both parties can share publicly and internally with those they work closely with.

2) Who is involved?

Is this a two way relationship? Some NDAs and confidentiality agreements are only there to protect one party, however plenty of times in business two businesses will be working together sharing each others’ data and they both need to be covered, so rather than signing two NDAs, a dual one is created where either party can be the discloser or the receiver.

Another thing to think about is the specifics of each business, is there a specific person or team that will need to know the information, or can it be shared throughout the company and with their employees and even subcontractors? If it can be shared, these other third parties may need to be subject to the same provisions as in this agreement, whether by an inference in their contracts or a new NDA just for them.

3) Give any specific parameters

How long does information need to be kept confidential, is there a short period of time where you will share that confidential information? How long afterward does that information need to be kept confidential? Generally the courts don’t look favourably upon an indefinite period of time, so you need to decide when your information will no longer be commercially sensitive.

Are there any specific ways or places you want your data stored? Some businesses require a particular level of security on the information passed, other than just it being kept away from the public eye. You may choose to include whether hard copies or soft copies are allowed, what passwords and keys are needed, or even any specifics on encryption within the company’s IT systems.

4) Extensions and termination

Does the agreement link with any other contracts? Is the term of the confidentiality linked to a contract for services or any other terms and conditions? If one is extended can the other also be extended? Are there any other ways the confidentiality agreement and the limits on confidentiality may be extended throughout the term?

If there is another contract or agreement that links to it, does the termination of that agreement also terminate the obligations of confidentiality? In the case of termination, what do you need to, does all of the previous information shared need to remain confidential still? Does the data need to be returned or destroyed? Is there a specific timescale or method of destruction you require this to be done within?

5) Breaches and consequences

It is also important to lay out exactly what are the consequences of any breach of the agreement, it is often the case that usual monetary damages are not sufficient to fully protect the business and restore them to their previous position – particularly when fines, reputation and third party contracts may be affected. It is more common that you will see that the discloser is able to apply for other remedies including injunctions and specific performance from the courts in order to properly rectify any breach.

Get in touch if you want to discuss this further or require an NDA in your business – email us at info@bebconsultancy.co.uk or call 01604 217365