We get it – no one likes legal documents, but they are the only way of protecting your business.
A non disclosure agreement or confidentiality agreement, allows parties to share what would be commercial sensitive or confidential information to the other party. It allows the sharing of important information from one party to the other without fear that the information would leak out. It is important if you are pitching a new idea or concept, entering into negotiations for a partnership or joint venture, or selling the business.
Why Do You Need A Confidentiality Agreement?
There are a lot of reasons why you need to sign a confidentiality agreement, they are the following:
- It gives both parties the confidence to share delicate information with the other party. There are some products and services that are proprietary. This means that some information is considered as very delicate and should be handled with caution not just with the use but with the spread as well. Signing a confidentiality agreement allows parties to share such information that could be vital in the development of the other person’s business or product.
- It allows the parties to create a trustworthy relationship. When a legal relationship is formed both parties are confident that one cannot break the terms of the contract and trust is built.
- It protects both parties from leaked information because it gives rise to the right of the other party to sue for breach of trust and confidence. In case of doubt and in case both parties have no idea how trustworthy the other is, there is a right to sue that makes the relationship a little more stable. When an obligation to keep information safe is present, both parties could take the other to court in case of a breach.
- It ensures both parties that the information will not leak into the competition.
- It enables the parties to protect each other from any kind of anomaly arising from the transactions.
Now that you know some of the reasons why you need to sign a confidentiality contract, you should always see to it that you apply it to your business. Nothing beats your hard work than by being sloppy on legal matters. Consult a lawyer on how you can always protect your rights with every contract that you are signing.