Confidentiality Agreement

It is possible for confidentiality agreements to be applied to all commercial relations. Before telling your potential business partners, 3rd party potential investors or your employees about a new original idea, product, prototype, software, invention or concept or classified information that may consist a trade secret, such as your client list, a confidentiality agreement should be signed in order to protect such private information.

Many people do not see a problem with stealing others’ ideas, or imitating their products or business models. Among these many people can be your employees, your consultants, your suppliers, and even your clients. They might get access to such information during the time you’re doing business with them. Therefore, it is essential to hold them responsible for the security of information, and penalise the breach of this responsibility. This is the purpose of confidentiality agreements. Confidentiality agreements are usually included as a clause in employment contracts, or drafted as a covenant, rather than a separate contract.

Confidentiality agreements are generally drafted as model/standard texts. Parties of the contract are referred to as “the disclosing party” and “the receiving party”.Confidential information must be defined in the contract. Any item the discloser would like to keep confidential must be explained in detail.

Information that might be confidential All kinds of information, inventions, methods, patents, utility models, industrial designs, copyrights, brands, trade secrets and other innovations regardless of whether or not legally protected, that will be disclosed to, or will be obtained in accordance to the legal relationship between parties by executives, employees and agencies of the discloser, or others who are contracted to carry out a work can be defined as “confidential information”.
Protection of classified information Aforementioned classified information must be,

• protected in great secrecy,
• under no circumstances disclosed to any 3rd parties and/or publicised,
• used only in accordance to the purposes of the business by real or legal entities who are party to the contract as the receiver by natural or legal person.

Receivers also agree to be equally protective towards the discloser’s confidential information as their own, however, with the discloser’s prior written consent, they may give access to their employees or others working for them if the nature of the work conducted requires so. They must warn those who receive the information about the secrecy of the information.
Non-confidential information is information that can’t be considered as confidential for various reasons.

• Public information,
• Information that must be disclosed due to the legislation, court rulings, or administrative orders can be non-confidential information.

Penalties are an essential provision of confidentiality agreements. Receiver agrees to pay the Discloser a compensation if the confidential information is exposed against the contract. The sum can be determined based on the losses of the Discloser due to the breach.
A well-drafted confidentiality agreement provides an effective protection. The Receiver accepts how serious you are in regards to protecting your rights by signing this agreement. This agreement, in a way, builds the foundation of your business relationship with the. In case of a breach, this agreement also accelerates the process in a court of law.

Att. Bülent KAPTAN
Patent & Marka Attorney
http://bkaptan.com/
kaptan@bkaptan.com