Abstract

In all business, information passes to different parties or people. It is essential for the information shared to be confidential; therefore a non-disclosure agreement (NDA) should be signed for assurance. A non- disclosure agreement is a document or contract signed by either two parties or more that assures them that other parties do not know the information given. Therefore, the party provided with the NDA signs the contract promising to keep the information offered a secret and the party submitting the NDA asks the other party no to disclose any given information. The primary purpose of a non-disclosure agreement is the protection of business secrecy to the outside parties, enemies or competitors. The main types of NDA are the unilateral agreement and the bilateral agreements. The one-sided involves one party, and the bilateral involves two parties in the agreement. The significant elements of NDA are the purpose of the contract, the disclosure of the information and exclusions from confidentially can be necessary.

Keyword: A non- disclosure agreement, unilateral agreement, bilateral agreements

Evaluation of Non-Disclosure Agreements, and how they Protect Businesses in the Short and Long Run

A Non-Disclosure Agreement is a legal document that protects the secrecy of information that is confidential in a business. The contract contains an agreement that entails knowledge bound to remain within the limitations of the confidentiality clause. Also, A Non-Disclosure Agreement protects business’s information from falling into unauthorized party or enemies. This paper will focus on the evaluation of non-disclosure agreements, and how they protect businesses in the short and long run

Elements and Types of Non-Disclosure Agreements

A Non-Disclosure Agreement is a simple document that is easily understood by the involved party. The terms and conditions are clear and illustrated, and they involve everything that the parties are agreeing to it need to know (De Cleyn, Meysman, & Braet, 2015). There are different elements of an NDA. The First one is the purpose of the contract and the medium in place whether it is tangible or intangible. The latter will help a business to avoid misinterpretation of information. Medium access can be only through authorization. Therefore, the data will reach the recipient in a secure safe manner without tampering or disclosing it to others. It also states the parties to whom the agreement is to address, and their consent in protecting the secrecy of the information.

The disclosure of the information entails whether the data for disclosing is unilateral or mutual. If shared, both parties will have to share confidential information. If it is in one-sided, only the disclosing party communicates secretive data to the receiving party. In either way, the recipient is not to reveal the information to others who are not part of the NDA.

Exclusions from confidentially can be necessary. In some instances, it might reach a point where to keep the information confident is no longer an option. The parties might agree to disclose the data to a third party. Such instances can be; when the data is already out to the public though it was not a wrongful disclosure from the recipient. Forth, the terms of involving the agreement, this defines the period at which the deal is supposed to last. Most of these Non-Disclosure agreements in businesses run just for a few years due to the rapid changes in technology. When the transaction reaches its end, the disclosing party is not supposed to continue disclosing information under copyright or the property laws.

These elements of Non-Disclosure Agreement can help protect the business in many ways. For example, the agreement specifies the purpose and ensuring that the parties abide by the limits of the pact. The latter will help to protect the secrets of the business and avoiding them from being in possession by another party such as competitors (Zanarone, Lo, & Madsen, 2016). Also, exclusion from confidentiality can help to protect the image and status of the business. Involving a third party when things are out of the line of the agreement can assist in determining potential breaches.

There are three types of Non-Disclosure Agreements; two-way, a one-sided agreement, and multilateral agreement (Contigiani, Hsu, & Barankay, 2018). The bilateral agreement or two- way agreement; this contract involves two parties sharing confidential information. The deal is meant to seal a deal of secrecy that will benefit both the parties. Every side protects the agreement of the other hand from any other outside party.he Unilateral Non-Disclosure Agreement or a one-sided deal, which is a contract signed by only one party. Therefore, one party can disclose confidential information to the other while the other retains theirs. The multilateral agreement is where many parties come into agreement and swear secrecy between them. These agreements occur mainly in great cooperation and online companies where many people agree to the terms of the offered services.

Assessment of Competing Views

An NDA means that information relating to services, customers, inventions, products, software, markets, research, developments, financials, and other items, should be confidential. The primary purpose of the Non-Disclosure Agreement is to prioritize information. A business benefits a lot by prioritizing information as it assists in achieving goals and desires (Zanarone, Lo, & Madsen, 2016). Obtaining information is an essential factor that a firm uses to strategies its steps. The purpose of the agreement will define the use of the information. Knowing the purpose will protect the firm in the fact that the data will be solely for contemplating the productive nature of the agreement relationship between the parties. Therefore, if the information links during the period of the agreement then the NDA terms break down.

Analysis of Purposes of Non-Disclose Agreement in long and short run businesses

The primary objective of a non-disclosure agreement is the protection of a company in the short and long run. In the long- run, companies can change cost and time phase and are bendable in their production decisions. Whereas, short-run businesses, are only able to manipulate prices through adjustments made to the production level. A non- disclosure agreement can protect both long runs like big projects; large time contracts between companies and central others.

Similarly, NDA protects short-run businesses, such as small projects, internships, and small business deals and short term businesses in various ways. There is a presentation of business ideas, contracts with potential investor and associates (Contigiani, Hsu, & Barankay, 2018). Also, a non-disclosure agreement is appropriate in conditions where one party receives certain services with sensitive information. The NDA helps in considering the prior fact in the business like offering services to the buyers where it is necessary to provide some information. For example banking details, address, occupation, and many others. An NDA needs in instances where an employer allows the employees to access confidential information.

An NDA helps in avoiding uncertainties and losses that might be as a result of breaches of information by enemies and competitors (De Cleyn, Meysman & Braet, 2015). An NDA is that it protects the copyright nature or the originality of the idea. Some investors or distributors might have ill intentions, and thus there is a need to have a Non-disclosure Agreement that will protect the ownership of the invention or the product.

Conclusion

In conclusion, Non-Disclosure Agreements plays a significant role in protecting the secrecy of a business. The NDA main purpose is to prioritize information. A company benefits a lot by prioritizing information which helps in achieving goals. The primary objective of a non-disclosure agreement is the protection of a business in the short and long run. An NDA outlines all the factors that need to be in place so that the relationship between the parties will be productive. Disclosure of confidential information needs to be a secret between the disclosing party and the recipient. In this way, a business can make potential and moves to grow without interference. The terms of the agreement are a shield to the secrecy of information, and that will protect crucial details of business from reaching an outside party and enemies. The non- disclosure agreement has three types, the bilateral agreement, the unilateral agreement, and multilateral agreement. The bilateral contracts involve two parties, the one-sided involves one party, and the multilateral involves many parties. The NDA is made up of different elements that make it easily understandable: The purpose of the contract, the disclosure of the information, and exclusions from confidentially can be necessary.

References

Contigiani, A., Hsu, D. H., & Barankay, I. (2018). Trade secrets and innovation: Evidence from the “inevitable disclosure” doctrine. Strategic Management Journal, 39(11), 2921-2942

De Cleyn, S. H., Meysman, J., & Braet, J. (2015). A Critical Assessment of the Non-Disclosure Agreement in the Framework of the Technology Transfer Process: A Longitudinal Study. The Journal of Private Equity, 39-51.

Zanarone, G., Lo, D., & Madsen, T. L. (2016). The double‐edged effect of knowledge acquisition: How contracts safeguard pre‐existing resources. Strategic Management Journal, 37(10), 2104-2120.