Progressive digitisation and digitisation are forcing enterprises to cooperate with external IT service providers. For it to be safe, it is worth obliging contractors to keep confidential the data provided about your organisation.
In this article you will learn:
In this article you will learn:
- What is NDA?
- What to look for when signing the NDA?
- Why is it worth signing an NDA agreement?
What is NDA?
NDA is an abbreviation derived from the English expression Non-DisclosureAgreement, which in Polish law is referred to as a confidentiality agreement. The purpose of such an agreement is to secure various types of well-defined information that are critical to running your business. In other words, by signing the NDA, the parties undertake to keep the details of the talks confidential and even (if properly written) to prohibit the creation of a competing project.
Usually, such an agreement is signed by parties who are not yet bound by any agreement that could regulate issues related to the exchange of information. On the other hand, the provisions on confidentiality may also be found in other documents, being simply an additional point in the contract.
There can be many reasons for signing the NDA, especially as they depend on the purpose of the talks. In the case of cooperation with an IT company, the reasons for signing a confidentiality agreement may be:
Usually, such an agreement is signed by parties who are not yet bound by any agreement that could regulate issues related to the exchange of information. On the other hand, the provisions on confidentiality may also be found in other documents, being simply an additional point in the contract.
There can be many reasons for signing the NDA, especially as they depend on the purpose of the talks. In the case of cooperation with an IT company, the reasons for signing a confidentiality agreement may be:
- disclosure of information about the flow of processes in the company for their automation or robotization,
- sharing an idea for a business on the Internet, for the implementation of which you have to commission the construction of a website or application,
- requirements resulting from the provisions of the GDPR, when your customer base is transferred,
- disclosure of codes or algorithms of information systems used by your company, e.g. to investigate possible integrations,
- revealing internal know-how, e.g. on the methods of acquiring and servicing customers to set up a dedicated CRM system.
Are you looking for an IT service contractor? Read the article on how to write an effective offer inquiry, i.e. a brief.
What to look for when signing the NDA
When signing a confidentiality agreement, there is a certain dependency to keep in mind. The more precise the NDA is, the better it protects your interests. In practice, this means that it will be easier to prove to the court that there have been infringements. Therefore, it is worth paying attention to a few issues.
The first is the exact identification of the parties to the contract. Perhaps, in addition to the name of your contractor’s company, it is worth trying to include the names of specific people who participate in the project. Especially if they cooperate with a potential service provider on B2B contracts, i.e. they are its subcontractors.
Second, clarify what your company thinks is inside information. For example, they can be results of specific market research, databases of your clients, technical data, developed business model, know-how, etc. Avoid broad and unclear phrases such as information important for the operation of the company.
Third, is the duration of the contract. When it enters into force and until when it is effective. The lack of a specific expiry date is tantamount to the possibility of termination.
Fourth, the obligations of the parties. They can be different. From the rules of transferring confidential information, through the rules of conduct and its protection, to the procedures for dealing with its leakage.
The issue of contractual penalty should not be ignored, although it must be mentioned here that your interests will be protected anyway by legal provisions resulting from the relevant acts. GDPR information clause and any final provisions, e.g. the number of copies of the contract or the court office that will consider a possible dispute; should also be included.
It is also worth mentioning that the legal department of iDMK has prepared a template of the NDA agreement, which the company’s clients are eager to use. The big advantage of the document is the fact that if there is a need to make the provisions in it more precise, it can be done without any problems. After all, it is most important that both parties feel confident when they are seated at the table.
The first is the exact identification of the parties to the contract. Perhaps, in addition to the name of your contractor’s company, it is worth trying to include the names of specific people who participate in the project. Especially if they cooperate with a potential service provider on B2B contracts, i.e. they are its subcontractors.
Second, clarify what your company thinks is inside information. For example, they can be results of specific market research, databases of your clients, technical data, developed business model, know-how, etc. Avoid broad and unclear phrases such as information important for the operation of the company.
Third, is the duration of the contract. When it enters into force and until when it is effective. The lack of a specific expiry date is tantamount to the possibility of termination.
Fourth, the obligations of the parties. They can be different. From the rules of transferring confidential information, through the rules of conduct and its protection, to the procedures for dealing with its leakage.
The issue of contractual penalty should not be ignored, although it must be mentioned here that your interests will be protected anyway by legal provisions resulting from the relevant acts. GDPR information clause and any final provisions, e.g. the number of copies of the contract or the court office that will consider a possible dispute; should also be included.
It is also worth mentioning that the legal department of iDMK has prepared a template of the NDA agreement, which the company’s clients are eager to use. The big advantage of the document is the fact that if there is a need to make the provisions in it more precise, it can be done without any problems. After all, it is most important that both parties feel confident when they are seated at the table.
Why is it worth signing an NDA?
Regardless of the type, contracts are signed for bad times, i.e. just in case. Their tasks are to protect interests, as well as to facilitate the enforcement of their rights. How well you protect your company or business idea depends on the provisions in the contract.
Therefore, in your NDA, it is important to indicate the purpose for which you will share confidential information. This is especially crucial when you are creating an innovative solution. One that can make a unicorn out of your business, i.e. a startup worth at least a billion dollars. What do we wish you!
Therefore, in your NDA, it is important to indicate the purpose for which you will share confidential information. This is especially crucial when you are creating an innovative solution. One that can make a unicorn out of your business, i.e. a startup worth at least a billion dollars. What do we wish you!