Confidentiality Clause
Also called: Non-Disclosure Obligation · NDA Clause · Confidentiality Obligation
A confidentiality clause restricts what a party may do with the other side’s non-public information. It defines what counts as confidential, what use is permitted, how long the obligation lasts, and which categories are carved out from protection.
In more detail
Definition scope is the first thing to check. Defining confidential information too broadly can make the clause impractical to comply with and harder to enforce; defining it too narrowly leaves genuinely sensitive material unprotected.
Standard carve-outs exist for good reason: information already public, information the recipient already held, information independently developed without reference to the disclosure, and information required to be disclosed by law or court order. A clause missing these is unusually aggressive.
Duration should match the information. Commercial terms may warrant two to five years; genuine trade secrets may justify longer or indefinite protection where the governing law allows it. Perpetual confidentiality over ordinary business information is often unenforceable and always impractical.
What our lawyers check
- Whether obligations are mutual or one-sided relative to who actually shares information
- Whether the standard carve-outs are present
- Survival period, and whether it is realistic for the type of information
- What must happen to the information when the relationship ends
Contracts where this clause matters
Related terms
This definition is general information about commercial contracting practice, not legal advice. How a clause operates depends on the specific wording of your agreement and the law that governs it. For advice on your contract, have it reviewed by a lawyer.
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