PowerPedia:Non-disclosure agreement

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A non-disclosure agreement (NDA), also called a confidential disclosure agreement (CDA), confidentiality agreement or secrecy agreement, is a legal contract between at least two parties which outlines confidentiality materials the parties wish to share with one another for certain purposes, but wish to restrict from generalized use.


A non-disclosure agreement is a contract through which the parties agree not to disclose information covered by the agreement. An NDA creates a confidential relationship between the parties to protect any type of trade secret. As such, an NDA can protect non-public business information. NDAs are commonly signed when two companies or individuals are considering doing business together and need to understand the processes used in one another's businesses solely for the purpose of evaluating the potential business relationship. NDAs can be "mutual", meaning both parties are restricted in their use of the materials provided, or they can only restrict a single party. It is also possible for an employee to sign an NDA or NDA-like agreement with a company at the time of hiring, in fact some employment agreements will include a clause restricting "confidential information" in general.


Some common issues handled within an NDA include:

outlining the parties to the agreement

the definition of what is confidential, i.e. the information to be held confidential. Modern NDAs will typically include a laundry-list of types of items which are covered, including unpublished patent applications, know-how, schema, financial information, verbal representations, business strategies, etc

the exclusions from what must be kept confidential. Typically, the restrictions on use of the confidential data will be invalid if

the recipient had prior knowledge of the materials

the recipient gained subsequent knowledge of the materials from another source

the materials are generally available to the public

the materials were obtained illegally or

the materials are subject to a subpoena. In any case, a subpoena would more likely than not override a contract of any sort

provisions restricting the transfer of data in violation of national security

the term (in years) of the confidentiality, i.e. the time period of confidentiality

the term (in years) the agreement is binding

permission to obtain ex-parte injunctive relief

the obligations of the recipient regarding the confidential information and

types of permissible disclosure - such as those required by law or court order.

Standard Form 312

Standard Form 312 (SF 312) is a non-disclosure agreement required under Executive Order 13292 to be signed by employees of the Federal Government or one of its contractors when they are granted a security clearance for access to classified information. The form is issued by the Information Security Oversight Office of the National Archives and Records Administration and its title is "Classified Information Nondisclosure Agreement." SF 312 prohibits confirming or repeating classified information to unauthorized individuals, even if that information is already leaked. The SF 312 replaces the earlier forms SF 189 or the SF 189-A. Enforcement of SF-312 is limited to civil actions to enjoin disclosure or seek monetary damages and administrative sanctions, "including reprimand, suspension, demotion or removal, in addition to the likely loss of the security clearance."

External articles and references


Non Disclosure Agreement

Confiendtiality and non-disclosure agreement form

SF-312 (PDF file) (ed., the SF-312 briefing booklet is avaiable also.)

confidential disclosure agreement (PDF)


"Search Inventors > Non Disclosure Agreements> Non Disclosure Agreements Non Disclosure Agreement", About, Inc., 2006.

Nolo, "patents, copyright & art ยป Nondisclosure Agreements". 2006 .

Information Security Oversight Office main page

Confidentiality and Confidential Disclosure Agreements (CDA) booklet edited by the United Kingdom Patent Office (300 Kb pdf file)

Confidentiality Agreements in IPR Helpdesk, a web site sponsored by the European Commission

Confidentiality Agreements - Piasetzki & Nenniger LLP, (2005)

Understanding Confidentiality Agreements by David V. Radack, Journal JOM,46 (5) (1994), p. 68.

Wikipedia contributors. Non-disclosure agreement. Wikipedia, The Free Encyclopedia. July 19, 2006.