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Standard Confidentiality Agreement Canada

October 8, 2021 | By More

Selling a business: A potential buyer of your business wants to know details such as operating costs, customer databases, new products under development, and manufacturing processes before accepting the purchase. A data protection agreement would help preserve the integrity of your company`s trade secrets and ensure compliance with data protection legislation. Contractor and Consultant: A contractor or consultant working for you may need to know sensitive information such as alarm codes for your home or if you are traveling for business. In this case, you can use a confidentiality agreement to ensure your personal safety. Many inventors and companies invest a lot of time and resources in developing new products or building a customer base. It is not surprising and certainly justified that great diligence should be exercised to ensure that such proprietary information does not fall into the wrong hands. However, to take the next step with a promising idea or activity, a company usually needs to share its precious secrets with strategic partners or potential investors. The signing of an effective confidentiality agreement (“NDA”) can therefore be a critical step in the development of a new business relationship or opportunity, giving the parties enough comfort to take this first step. Each NDA should specify the obligations of the parties at the end of the NDA. As a general rule, there is an obligation to make information confidential, sometimes only after receiving a written request, or to confirm that all copies of it have been destroyed, sometimes in accordance with certain protocols (e.g.B.

to really remove information from hard drives). However, there is generally a genuine debate as to whether these obligations should be subject to carve-outs that allow the receiving party to retain copies to the extent prescribed by law (e.B.g. for income tax purposes or in accordance with accounting standards) or in accordance with internal accounting requirements. You can also address the practical difficulties of deleting data from electronic databases that can be archived in a routine way for disaster recovery purposes. These carve-outs should carefully describe the circumstances in which information stored in stock can be accessed/used after completion. If a receiving party is unable to justify an appropriate purpose for the retention of information, separation may not be appropriate. Parties should also consider how long the information should remain confidential. Any party that discloses would prefer that their information remain confidential forever. As a rule, the provisions relating to the confidentiality of commercial transactions are approximately two years. All personal information must remain confidential for an indefinite period of time. Again, the proper conduct of confidentiality obligations depends on the nature of the information.

The parties should include an appropriate sunset, failing which a court may impose one on them. It should also be taken to define who can obtain confidential information with a view to promoting the authorised or stated purpose. It is often necessary to pass on information to professional employees or consultants (or even funding sources, related companies or sponsors, etc.), but this should be taken into account on a case-by-case basis. . . .

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