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A Non-Disclosure Agreement (NDA) is a legally binding contract used to protect confidential information shared between parties. It ensures that the recipient of sensitive information agrees not to disclose, misuse, or share it without prior consent. NDAs are commonly used in business settings, partnerships, or employment to safeguard intellectual property, trade secrets, and proprietary data.

Purpose of an NDA

  1. Confidentiality: To legally bind parties to maintain the secrecy of shared information.
  2. Protection of Intellectual Property: To safeguard sensitive data like trade secrets, inventions, or designs.
  3. Clarity on Permitted Use: To define how confidential information can be used and under what circumstances.
  4. Legal Recourse: To provide a basis for legal action in case of breach.

Types of NDAs

  1. Unilateral NDA: One party shares confidential information, and the other agrees to keep it secret.
  2. Mutual NDA: Both parties exchange sensitive information and agree to protect each other’s data.
  3. Multilateral NDA: Involves three or more parties where at least one discloses confidential information.

Key Clauses in an NDA

Definition of Confidential Information

Clearly specify what is considered confidential.

Obligations of the Receiving Party

Define the recipient's responsibilities to safeguard the information.

Exclusions

Outline what is not considered confidential (e.g., publicly available information).

Duration of Confidentiality

State how long the confidentiality obligations will last.

Permitted Disclosures

Mention any exceptions, such as disclosures required by law.

When is an NDA Required?

  • Sharing business plans, strategies, or financial data.
  • Discussing potential partnerships or mergers.
  • Hiring employees or freelancers exposed to sensitive data.
  • Developing intellectual property, such as software or inventions.
  • Collaborating with vendors or contractors.

Benefits of an NDA

  1. Protects Business Interests: Prevents leakage of critical information to competitors.
  2. Legal Safeguard: Acts as a legal tool to address breaches of confidentiality.
  3. Encourages Transparency: Establishes trust by clearly defining confidentiality terms.
  4. Promotes Collaboration: Enables parties to freely share information without fear of misuse.
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Frequently asked Questions

Yes, stamping is a necessary procedure for NDA. Without a stamp the document will not be accepted in court. The stamp duty on NDA may vary from state to state.

The NDA is a legally binding contract as it is governed by the Indian Contract Act, 1872. It is enforceable in India.

Yes, both the parties should sign the agreement.

It can help you get your Non-Disclosure Agreement reviewed and provide you with the right legal guidance. 

Why Choose Us

Experienced Professionals:

Our team consists of certified and experienced Registered Valuers who follow industry standards and legal requirements.

Timely and Accurate Reports

We deliver detailed and accurate valuation reports within the stipulated time frame, ensuring that our clients can make informed decisions.

Secure & Confidential

Documents and information are always kept private. Information shared with the lawyer are 100% confidential.

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