To Disclose Or Not To Disclose

Non-Disclosure Agreement

A non disclosure agreement is a legal document that legalises the protection of confidential information. In other words, if someone signs a non disclosure agreement but breaches confidentiality, they will be liable. Liability could mean a heavy fine, a business’s reputation, sometimes even jail time. It all depends on how much it’s been disclosed and what’s been disclosed. Also, the implications resulting from that disclosure or breach of confidentiality.

Breach Of Confidentiality

A breach of confidentiality is a betrayal of trust. There are always consequences from a betrayal of trust, no matter how you look at it. If you trust someone with sensitive information, it will likely affect you in a negative way. It could impact your business to the extent that you could loose revenue or even end up going bankrupt or in liquidation. Examples of betrayal of trust could be intellectual property, a business model that’s meant to be a company secret, even food recipes.

Examples Of Confidentiality Breaches

For instance, every head baker of a famous cafe in Portugal called Pasteis de Belem, signs a NDA to keep the traditional cake recipe a secret. The recipe is kept locked in a safe. Disclosure of the recipe secret could mean jail time in Portugal. This isn’t a case of national security but it is a serious offence because it could be the colapse of a business established in 1837 – a business that survived WWI, WWII and the 1974 revolution.

From Employment Termination To Imprisonment

Other examples of breaches are either deliberate breaches or negligence by members of staff. Sharing financial data or client details could lead to termination of employment and civil litigation. If the information discloses secrets of the business model, it would cost the perpetrator their job, a heavy fine and also a civil litigation case. A serious example of confidentiality being breached would be if the information disclosed affects national security. This too could mean imprisonment.

You must always read carefully any non-disclosure agreement prior to being signed. s you’ve signed. Always remember what’s include din the NDA to avoid carelessness or negligence that could cost you more than a termination of contract. Whether you’re a supplier or service provider, you need to ensure that you are compliant, even if you’re the one who’s drafted the NDA. If you’d like to have an NDA reviewed or drafted, please get in touch for a no commitment initial consultation. SG

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