Confidentiality and Nondisclosure Agreements Explained

Confidentiality agreements and nondisclosure agreements (NDAs) are both legal contracts among two or more parties that specify the criteria for maintaining the confidentiality of certain information. In both confidentiality agreements and NDAs, parties agree to keep private nonpublic information received during a business relationship, including in the early stages of exploring a potential business relationship.

Confidentiality and nondisclosure agreements typically:

  • Describe the context for the parties’ agreement, referencing any related transactional documents
  • Define the specific information to remain confidential
  • Outline the parameters for the parties’ use of confidential information

The need for a confidentiality or nondisclosure agreement can arise in a wide variety of contexts, including:

  • Mergers and acquisitions
  • Joint ventures
  • Sales and service agreements
  • Employment contracts
  • Intellectual property licensing

While confidentiality agreements and NDAs are both used for similar purposes and to protect similar information, they’re often used in different settings and applied to different types of contracts.

[Download this sample mutual nondisclosure and confidentiality agreement that can be adapted for your individual needs.]

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