What is a confidentiality Clause?

What is a confidentiality Clause?

December 25, 2019

A confidentially clause just like the word confidentially implies, is the section of a legal agreement that prohibits a party from disclosing important information such as trade secret that they might become privileged to in the course of the business to a third party without authorization.

A confidentiality clause can also be used interchangeable or in the stead of a non-disclosure Agreement (NDA).

The essence of this clause is to protect contracting parties from either revealing the information that they are privy to, sell or even give such information to a third party which might be detrimental to the party whose information is disclosed.

The effect of disclosing such confidential information to a third party is that it amounts to a breach of the agreement and a great recourse might be taken to address such breach. Such violation might cause the party great financial loss in which the disclosing party might be required to pay.

A party cannot be said to have breached a confidentiality agreement where,

  1. Such information later becomes known to the public by no fault of the party who was privy to such information.
  2. If it is required by law or the court to be disclosed.
  3. If the receiving party was already privy to the information before the agreement.
  4. If he gets such information from a third party having no obligation to the confidentiality information disclosed.
  5. If it was independently developed or acquired.

In conclusion, it is advisable to include a confidentiality clause when entering an agreement that might cause you to disclose your commercial secret to the other party. This is because it acts as a shield giving the other party prior notice of the duty of trust to hold such information he might come across either expressly or by omission in confidence.

 

The information in this blog post (“post”) is provided for general informational purposes only, no information contained in this post should be construed as legal advice, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through this post without seeking the appropriate legal or professional advice from the particular facts and circumstances at issue from a lawyer. This post is protected by intellectual property law and regulations. It may however be shared using appropriate sharing tools provided that our authorship is always acknowledged and this Disclaimer Notice attached.

More Articles

Search

Connect With Us

Got any questions?

If you are having any questions, please feel free to ask.

Send us an email

Frequently Asked

  • When are Annual Returns due for filing?

    A company’s first Annual Returns are due for filing after 18 months of its inception, subsequently it should be filed annually as the name implies. The filing dates could differ for each company depending on their financial year end but must be filed not later than 42 days after its Annual General Meeting.

    The Annual Returns for Business Names is due not later than the 30th of June each year except in the year the business was registered.
  • Do I need a Company Secretary?

    A limited liability company (LLC) must have a company secretary.
  • What is a testimonium clause in an agreement?

    This is the part of the agreement where the witness attests to have witnessed the execution of the agreement.
  • If I have NAFDAC Registration number, do I still need SON registration number?

    SON Product Registration scheme is mandatory for all SON’s regulated products as mandated by SON Act 56 of 1971, 20 of 1984, 18 of 1990 as amended.

    This is irrespective of the registration done by NAFDAC
  • What is classified as personal data?

    Name, photograph, personal health/bio information, account/financial information, phone number, Address, date of birth, place of birth, Email address, etc.
  • What is the basic criteria for registering a Design?

    The design must be new and original. This means that it must be a unique design not similar to an already existing design.
  • Is there a penalty for late renewal of registration of products with NAFDAC?

    Yes, there is a late renewal fee, which is dependent on the category of the product.
  • What’s the difference between a business name and an LLC?

    • A business name is a sole proprietorship, usually owned and managed by one individual only. Legally, the sole proprietor and his business are one. It simply means an individual trading with an alias. The sole proprietor is personally liable for all business related obligations.

    • A limited liability company on the other hand is a separate business entity from the individuals that hold its shares and act as directors. Legally, it’s a separate business entity and a person on its own who can transact business, own property separate from its owners and can sue or be sued. 
  • Does a trademark search automatically reserve my trademark name?

    No, a trademark search does not automatically reserve that which is sought to be trademarked. A search ascertains whether that which is sought to be trademarked is available or violates any existing trademark.
All FAQs
Call Us Now on +234 901 719 0079 Chat on WhatsApp