Last edited 02 Oct 2020

Non-disclosure agreement for building design and construction

Non-disclosure agreements (NDA sometimes known as confidentiality agreements) are documents that can be agreed before confidential information is disclosed about a project, product or idea. They are legal contracts which set out how information can be shared, and formalise a relationship where it may not be wise to assume that the other party will keep information confidential.

They may protect information recorded in a certain form, perhaps marked as ‘confidential’, or they may protect information shared under certain circumstances, such as in presentations or meetings, or during the course of employment or consultancy. They can be used to prevent commercially sensitive information from being shared, or to prevent parties from communicating certain information to the press or other third parties.

For more information, see Proprietary information.

They may, for example, be signed:

As a condition of entering into discussions about a potential relationship. For example, an inventor wanting to discuss their ideas with someone else.
When developing a new product or process with someone else.
To formalise a relationship, for example between an employer and employee or upon being appointed to a project to perform a specific task (such as a consultant, contractor, supplier and so on).

A non-disclosure agreement can limit the use of ideas and information for a specific purpose, although it is possible to amend them to allow for wider permission at a later date. Typically they will last for 3 to 5 years, following which the information can be used or disclosed publicly. However, they may last for the duration of a relationship (such as employment), or for a period after a relationship has ended, and some information can remain confidential indefinitely.

Non-disclosure agreements can cover information such as:

Intellectual property.
Commercial or trading information.
Technical drawings or designs.
Business plans.
Customer and potential customer lists.
Mathematical and chemical formulae.
Trade secrets which could include a formulae, programmes or processes.
Personal information about individuals involved in a project
Non-patentable know-how.

Non-disclosure agreements should set out:

The parties involved.
The information protected.
The duration of the protection.
Permitted uses of the information.
Circumstances under which the information may be shared (for example with employees).
If the parties are located in different countries, the agreement will need to state which country’s law it is governed by.
Whether it is one-way or mutual. A one-way agreement might be appropriate when only a single party is disclosing information whereas a mutual agreement would cover both parties.

It may not always be possible to secure a non-disclosure agreement, even where confidentiality is important to one of the parties, for example if the other party has nothing to gain by signing the agreement.

In some circumstances, parties can feel compelled to sign agreements which prevent reasonable use of information, for example if this is a condition of securing a large or prestigious contract. This was the case for the contracts relating to the London 2012 Olympics, where suppliers appointed to deliver the project where prevented from talking or writing about it, even after the games had finished. This was considered by many to be unnecessary, and driven by a desire to control press coverage and maximise sponsorship revenue, but it prevented UK companies from using their involvement in the games to enhance their profile and secure more work.