A Non-Disclosure Agreement is a legal document that you can use to disclose confidential information to another party, while legally forbidding the recipient from disclosing that information to any person or entity. This document is only enforceable if it is signed by you and the other party, therefore it is crucial that it is signed before you share any confidential information.

A one-way NDA protects only one party compared to a two-way NDA. If you are seeking to protect the information of both parties, see our Non-Disclosure Agreement (Mutual).

Use this Non-Disclosure Agreement (One Way) if:

• You would like to put restrictions on the use of confidential information (Ensure it doesn't reach competitors or other third parties);
• You would like to maintain secrecy of information when working with a new employee;
• You would like to protect confidential information including intellectual property, financial projections, customer lists and trade secrets;
• You would like to protect the confidential information of one party.

What does the Non-Disclosure Agreement (One Way) cover?

• A description of the confidential information;
• Confidential rights and obligations of the parties;
• Protection of sensitive information;
• Return of confidential information at the end of the agreement;
• Obligations regarding proper use of the information; and
• Circumstances where disclosure is permitted.

What happens if a Non-Disclosure Agreement is breached?

When the time of disclosure is during the time period specified before the termination of this agreement. If both parties have expressed consent prior through signature, the NDA is a binding legal contract that outlines a confidential relationship between the vendor/suppliers and the other party. Therefore, when a breach or violation occurs, you are able to claim rights in dispute against the violating disclosing party. These rights are outlined in the provisions of this agreement - some specifications include; an injunction, damage for loss, court order. The most commonly found right is if an employee breaches an NDA with a business/business owner then the employee can be immediately terminated.

What type of information can be covered in a Non-Disclosure Agreement?

Subject matter in the entire agreement is broad and can be customised to your needs. Common information that can be covered is inclusive of but not exhaustive to; patents, copyrights, financial information, customer lists, trade secrets. You can use this Lawpath template as a base and then customise the document accordingly.

How long is a Non-Disclosure Agreement effective for?

It is not an essential element of a non-disclosure agreement to impose a specific time-frame. It is recommended that your document should not contain a time-frame and an obligation of confidentiality remain until the information is no longer classified as confidential and enters the public domain. In cases where the parties decide to agree on a time-limit, to ensure enforceability, the deadline must not go over what is reasonably necessary to protect the legitimate interests of your business.

Will my Non-Disclosure Agreement be enforceable overseas?

Like many contracts, this document is only enforceable in the country or state specified in the agreement. Similarly, this document is governed by the law/s in the respective country or state it is executed in. If you intend to take legal action to enforce this Agreement or seek remedies for its breach, you will need to do so in the State or Territory Court the document was executed in. 

Should I ask my employees and interns to sign a Non-Disclosure Agreement?

One of the most common forms of non-disclosure agreements exists between an employer and employee. Confidentiality agreements are beneficial in the context of employment because they allow for a free-flow of confidential information within the workplace to maximise business productivity, while at the same time prohibiting employees from using or disclosing confidential information. Employment agreements also often include a binding confidentiality clause.

Who else should sign a Non-Disclosure?

Clients

When engaging with clients or potential clients, a business or entity may have the clients sign a non-disclosure agreement when sensitive information is disclosed.

Vendors

A business that relies on third-party vendors who may have access their confidential information should get the vendor to sign a non-disclosure agreement during their business relationship to ensure their information is protected.

Contractors

Having an independent contractor sign a non-disclosure agreement where they may have access to confidential information during their employment, would prevent the contractor from acting on the information and protect the contracting entity.

Investors

Investors may be asked to sign a non-disclosure agreement when commercially sensitive information is shared between the parties to ensure the information does not go public, and the information is protected.

What happens if the terms of my Non-Disclosure Agreement are broken?

A non-disclosure agreement sets out the rights of a party in the event of a breach by the other party. These rights may include:

• Obtaining an injunction in the event of an anticipatory breach (to prevent information from being released).
• Monetary compensation (damages) where a breach has already occurred.

Other names for Non-Disclosure Agreement include:

• NDA;
• Confidentiality Agreement;
• Confidential Disclosure Agreement (CDA);
• Proprietary Information Agreement (PIA);
• Secrecy Agreement (SA);
• Confidentiality Contract; and
• Gag Order.

Other documents you may need:

• Non-Disclosure Agreement (Mutual)
• Full Time Employment Agreement (Long Form)
• Confidentiality Policy
• Heads of Agreement
• Intellectual Property Agreement

Further information

• Can I issue a Non-Disclosure Agreement (NDA) for Past Information?
• What Happens If There Is A Privacy Breach Of NDA Information?
• Top 5 Enforceability Issues For NDAs
• What Is the Difference Between Privacy and Confidentiality in Australia?
• 10 Things To Know About Non-Disclosure Agreements
• Should You Use A Mutual or One-Way NDA?