Non Disclosure Agreement

A non-disclosure agreement (NDA), also known as a confidentiality agreement (CA), confidential disclosure agreement (CDA), proprietary information agreement (PIA) or secrecy agreement (SA), is a legal contract between at least two parties that outlines confidential material, knowledge, or information that the parties wish to share with one another for certain purposes, but wish to restrict access to or by third parties. It 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 confidential and proprietary information or trade secrets. As such, an NDA protects non-public business information. Like all contracts, they cannot be enforced if the contracted activities are felonies.

NDAs are commonly signed when two companies, individuals, or other entities (such as partnerships, societies, etc.) are considering doing business and need to understand the processes used in each other’s business 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 restrict the use of material by a single party.

It is also possible for an employee to sign an NDA or NDA like agreement with an employer. In fact, some employment agreements will include a clause restricting employees’ use and dissemination of company-owned confidential information.

Use of non-disclosure agreements are on the rise in India and is governed by the Indian Contract Act 1872.Use of an NDA is crucial in many circumstances, such as to tie in employees who are developing patentable technology if the employer intends to apply for a patent. Non-disclosure agreements have become very important in light of India’s burgeoning outsourcing industry.
Non compete and non disclosure agreement- Although it is part of service agreement but if it is not part of service agreement a non compete agreement should be signed, so that the employee may not be able to disclose or compete your information to other people.
Criminal breach of trust complaint-Under the Indian penal code a criminal breach of trust complaint can be lodged against an employee, i.e. under IPC 406, if he has stolen the information and disclosed it to your competitor.This is also the provisions which will help you to prevent your trade secrets.
Protection under the copyright act-if the information stolen is protected under the copyright act, such as software and databases are covered under section 63 of the copyright act, and civil proceedings are also maintainable.

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