Non - disclosure agreements, also referred to as confidentiality agreements are a very important part of any online business, especially as the business grows and other people have to be involved. In the online business world - where ideas could literally make millions - its important that you protect your online businesses by ensuring that people brought on board or who for some reason must be given a peek at what you are doing , or intend to do, do not take your ideas or information about you elsewhere, or use it to your detriment.

The purpose of this type of agreement especially for online businesses is to ensure that information disclosed to other people, businesses, partners or parties remains protected, with legal consequences if the agreement is breached. To basically encapsulate the ideas behind this agreement , its intent is to ensure that information given in confidence is not shared with any other party.

This agreement ensures that your online business is protected from any harm that may be caused by the use or misuse of information given to an outside party. A Non-disclosure agreement will mean that were there is a breach of the agreement you will be able to seek monetary damages from the other party. I guess at this point the question is “with whom should I sign an NDA ?”

This agreement can and should be used on projects where there are third parties, for example

  • Web designers - because of sensitive information that may have to be given to your web designers it will be wise to protect yourself by using a non-disclosure agreement
  • Graphic designers - with this group just as with web designers , it is important that you protect the information that must be passed on to this group
  • SEM and SEO operators - Sometimes you may choose to bring in an outside party to do some search engine marketing and optimization,especially with this group a lot of information must be passed to them . It is of extreme importance that you protect yourself. As a matter of fact, most of these companies already have templates of this agreement and signing such an agreement is ussually a prerequisite for going ahead with the deal

I’m sure that there are other parties that are usually involved in various aspects of online businesses but I hope that the three above at least give a basic idea of parties with which such an agreement should be signed.

Some important areas that are usually a part of a standard confidentiality agreement include

  • The definition of ‘confidential information
  • Care of confidential information
  • A clear description and definition of liability for disclosure of any confidential information
  • Use of confidential information by recipient
  • An essential definition of the business relationship between all the parties involved
  • Obligations to third parties
  • Implied license about confidential information
  • he process and procedure for the returning of all confidentail information ( where necessary and possible )at the end of the contract
  • Governing law
  • Terms of agreement

An example of a non-disclosure agreement is given here and there’s another here . PLEASE READ ALL THE WARNINGS AT THE BEGINNING OF THIS SERIES HERE, THIS SERIES ACTS AS A GUIDELINE AND A STARTING POINT FOR YOUR RESEARCH, IT IS IMPORTANT THAT YOU USE AN ATTORNEY ATLEAST TO REVIEW YOUR DOCUMENT.

Hope you enjoyed reading this post, third in this series dealing with the legal side to running online businesses .