Non Disclosure Agreement

There are various events or circumstances under which an NDA shall be entered into and signed. Few of them are as follows:

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An NDA referred to as a “confidentiality agreement” is an agreement in which the parties agree to share confidential information/data specified in the “confidentiality clause” of the compliance. The party agrees not to disclose such information to the third party beyond the terms of the accord.

Specific names of Non-Disclosure Agreement:

A Non Disclosure agreement has several names like:

Confidential Agreement (CA)

Confidentiality Disclosure Agreement (CDA)

Secrecy Agreement (SA)

Proprietary Information Agreement (PIA)

When to sign a Non Disclosure Agreement?

There are various events or circumstances under which an NDA must be entered into and signed. Few of them are:

  1. while providing employment,
  2. when discussing commercially sensitive information with another party, etc .;
  3. when processing sensitive customer information,

 in a commercial transaction,

  1. While taking expert advice on a new product,
  2.  When starting a new project,
  3.  While studying an investment possibility with another party,
  4.  When signing a contract for a sensitive Project,
  5.  When discussing commercially sensitive information with another party, to keep it secure according to the terms of an Agreement that is modified to protect the proprietary data from any misuse.

Non Disclosure Agreements Legally Binding?

The Non-Disclosure Agreement is governed by the Indian Contract Act 1872 and, according to it, a Non-Disclosure Agreement (NDA) is a legally binding contract. To ensure validity and enforceability it is suggested to stamp the agreement.

Is it obligatory to print a non-disclosure agreement on stamp paper?

It is not mandatory to print an NDA on stamp paper. NDA shall print on company letterhead and sign by both parties on each page of the NDA.

If you choose to print the NDA on stamp paper, have it printed on non-judicial stamp paper or electronic stamp paper (available in some states). Have the NDA signed in the presence of witnesses? After that, you need to get the NDA notarized.

What is the difference between a witness and witnessing a Non Disclosure Agreement?

An agreement with witnesses has a statute of limitations of twelve years to bring a claim for breach of the Agreement. An act of check without witnesses is six years.

The statute of limitations means the legally specified period beyond which no legal action can take in court.

Is Registration of a Non-Disclosure Agreement necessary?

According to Indian Contract Law that governs the Non-Disclosure Agreement in India, registration of an NDA is not mandatory. But it is advisable to register an NDA as it becomes easy to prove the validity of the document as well as to prove your case.

What happens if you break the NDA?

Penalties for breaching an agreement are specified clearly; breaches or violations are dealt with accordingly. If an agreement the sanction is not specifying, it is clearly stating that the person guilty of breach or breach of contract will fall into litigation for such misappropriation.

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