What is a non-disclosure agreement (NDA) in the Netherlands?
A non-disclosure agreement (“NDA”) in the Netherlands is an agreement whereby two or more parties agree to keep certain confidential information secret and thus not to share confidential information with others. A NDA sets out terms and subjects for confidential information. You often find non-disclosure stipulations in agency contracts. The type of information that is subject to secrecy is unlimited. Any exchanged information may be considered confidential. This includes business results, technical data, data of customers, trade secrets or data about intellectual property rights. An NDA is often also referred to as “a confidentiality agreement”.
Key elements of a non-disclosure agreement under Dutch law
Although an NDA is not legally anchored, there are a few key elements that need to be included in NDA’s. These are inter alia:
The description of the purpose for disclosure of certain confidential information. It is important that this purpose is clearly set out. This is because it determines for what purpose the receiving party may use disclosed information and which persons will have access to the information.
Disclosure of confidential information to employees and third parties. An NDA only protects the way in which confidential information is used or published between the parties that agreed upon the NDA. Thus, it is of importance that the parties define the exchange of confidential information with and the liability for information revealed to third parties. In principle, the receiving party will be liable for third parties to whom he will disclose the confidential information from the NDA. Therefore, NDA’s often include either that the receiving party is jointly and severally liable for any failure of a third party, or that the receiving party is obliged to talk about adequate confidentiality obligations with the third parties that will be involved.
The final date to the obligation to keep the disclosed confidential information secret. The term after which all duties cease is often set at two, three or five years. However, it is important to keep in mind that the agreed confidentially obligations might survive the end term of the contract. According to Dutch law, a party may still be liable for any confidential information revealed after the end of the contract. This might constitute an unlawful act.
The exceptions of keeping confidential information secret. Information that is already known to the receiving party before disclosure according to the NDA, is often excluded from the definition of confidential information. This can also entail information that is already publicly available.
A penalty provision. This provision determines that if the if the receiving party breaches any provision of the NDA, the receiving party will need to pay an immediately payable penalty to the disclosing party. A fine for breach of confidentiality can ensure that the parties adhere to their agreements and therefore the confidentiality. A penalty clause will make it relatively easy to receive compensation in case the confidentially obligations are breached.
Drawing up a non-disclosure agreement in the Netherlands
The Dutch lawyers of Fennek Advocaten are all experienced in the drafting and negotiating of non-disclosure agreements (“NDA”) in the Netherlands. If you need assistance of a law firm in the Netherlands for non-disclosure agreements (NDA), please contact our partner of Fennek Advocaten, mr. Lisa Jie Sam Foek (firstname.lastname@example.org)