NDA Template UK: When You Need a Non-Disclosure Agreement and What It Must Say
You’ve got a great idea. You’re speaking to a potential supplier, freelancer, manufacturer, investor or business partner. But before you can really get the conversation going, you need to tell them information you wouldn’t necessarily want shared with anyone else.
That’s where a Non-Disclosure Agreement, usually shortened to an NDA, can come in. An NDA is designed to protect confidential information that you need to share with another person or business. It sets out what information is confidential, what the recipient can and cannot do with it and what happens if they disclose or misuse it.
But when do you actually need one? And what should a good UK NDA template contain? Let’s take a look.
What is an NDA?
A Non-Disclosure Agreement is a legally binding agreement requiring one or more parties to keep certain information confidential.
You might also hear them referred to as:
- confidentiality agreements; or
- confidential disclosure agreements;
They are commonly used before commercially sensitive information is shared, particularly where the parties do not already have a contract containing suitable confidentiality provisions.
For example, you may want an NDA in place before sharing information about:
a new product or service;
- a business idea;
- designs, drawings or prototypes;
- pricing or financial information;
- business plans;
- customer or supplier information;
- software or technology;
- trade secrets;
- manufacturing processes;
- marketing strategies; or
- intellectual property that has not yet been made public.
The key point is that the information needs to be genuinely confidential. You cannot usually make information confidential simply by putting it into an NDA if it is already publicly available.
When should you use an NDA?
There is no rule saying every business conversation needs an NDA. In fact, asking someone to sign one before you have even told them what you want to discuss can sometimes be unnecessary.
However, an NDA can be particularly useful where you need to reveal enough commercially sensitive information for the other party to evaluate an opportunity, carry out work for you or discuss a potential relationship.
Discussing a new business idea
You may be talking to a developer, manufacturer, designer, consultant or potential collaborator about an idea that you are not ready to make public.
An NDA can help ensure they only use the information for the purpose for which you have shared it.
Speaking to potential investors or buyers
If you are discussing an investment, acquisition or sale of a business, you may need to disclose financial information, forecasts, customer data or commercially sensitive plans.
A suitable NDA can help control how that information is used and disclosed.
Working with freelancers and contractors
Freelancers often need access to internal systems, client information, processes and other confidential material.
Your main freelancer or contractor agreement should ideally contain appropriate confidentiality provisions, but an NDA can sometimes be useful before the main contract is entered into or where particularly sensitive information is being discussed.
Developing a new product
If you are asking another business to help design, manufacture, test or develop a new product, confidentiality can be especially important. You may be sharing drawings, specifications, designs, prototypes or other valuable information long before the finished product reaches the market.
If that sounds familiar, having the right NDA in place before you disclose the information is important.
Need an NDA? Take a look at our range of professionally drafted UK NDA templates designed to give businesses a practical starting point for protecting confidential information.
What should a UK NDA template include?
A good NDA template UK businesses can rely on needs to do more than simply say, “you must keep this confidential”.
The exact wording will depend on why the NDA is being used, but there are several important areas it should cover.
1. Who is giving and receiving the information?
The agreement should clearly identify the parties involved.
It should also establish whether the NDA is:
One-way, where only one party will be sharing confidential information; or
Mutual, where both parties expect to disclose confidential information to one another.
This is an important distinction.
For example, if you are simply showing a manufacturer your confidential product design, a one-way NDA may be sufficient.
If two businesses are exploring a joint venture and both will be exchanging commercially sensitive information, a mutual NDA may be more appropriate.
2. What counts as confidential information?
This is one of the most important parts of an NDA.
The definition needs to be wide enough to protect the information you genuinely need to keep confidential, without being so vague that nobody can tell what is actually covered.
Depending on the circumstances, this might include information provided:
- verbally;
- in writing;
- electronically;
- through drawings or designs;
- during meetings or presentations; or
- by allowing someone access to systems, premises or prototypes.
A standard NDA template UK businesses download online may contain a broad confidentiality definition, but it is still important to check that it actually covers the type of information you intend to disclose.
3. What can the recipient use the information for?
An NDA should normally say why the information is being shared.
For example:
- considering a potential business relationship;
- obtaining a quotation;
- developing a product;
- evaluating an investment opportunity; or
- carrying out a particular project.
This is important because you do not simply want the recipient to promise not to publish your information. You also want to restrict them from using it for another purpose.
If you give somebody confidential specifications so they can provide you with a manufacturing quote, for example, you do not want them using those specifications to develop a competing product.
4. Who can they share it with?
Sometimes the recipient genuinely needs to disclose the information to other people.
That might include their:
- employees;
- directors;
- professional advisers;
- contractors; or
- other representatives involved in the project.
Your NDA should deal with when those disclosures are permitted and what safeguards need to be in place. You may also want the recipient to remain responsible for ensuring that anyone they share the information with keeps it confidential.
5. What information is excluded?
Not everything should be treated as confidential forever.
An NDA will usually contain exclusions for information that:
- is already publicly available;
- was already lawfully known to the recipient;
- is received lawfully from somebody else;
- is independently developed without using the confidential information; or
- has to be disclosed by law or a regulatory authority.
These provisions help make the agreement more balanced and commercially realistic.
6. How long does the confidentiality obligation last?
Another common question is:
“How long does an NDA last?”
There is no single answer. The appropriate period depends on the information being protected.
Some commercially sensitive information may lose its value quite quickly. Other information, particularly trade secrets or proprietary processes, may remain valuable for many years.
Your NDA therefore needs to distinguish between the length of the business discussions themselves and how long confidentiality obligations continue afterwards.
An agreement that ends does not necessarily mean the confidentiality obligation should end at exactly the same time.
7. What happens to confidential documents afterwards?
A useful NDA should also consider what happens when discussions or the relationship come to an end.
For example, should the recipient:
- return confidential documents;
- destroy copies;
- delete information stored electronically; or
- confirm that the information has been destroyed?
There may need to be sensible exceptions where documents must be retained for legal, regulatory, insurance or backup purposes.
8. Does an NDA protect your intellectual property?
An NDA can help protect confidential information relating to your intellectual property, but it does not automatically give you intellectual property rights. This is an important distinction.
If you are paying somebody to create designs, branding, software, written content or another piece of intellectual property for you, you may also need provisions dealing specifically with ownership and assignment of those rights.
Confidentiality and intellectual property often overlap, but they are not the same thing.
Is a generic NDA from the internet enough?
Sometimes. But it depends on what you are trying to protect. A free or generic NDA may look perfectly okay to an untrained eye but could still be missing provisions that matter to your particular situation.
For example, you may need to think about:
- whether the NDA is one-way or mutual;
- exactly what information is being protected;
- whether designs or prototypes are covered;
- disclosure to employees and advisers;
- permitted use of the information;
- intellectual property;
- how long confidentiality continues;
- returning or destroying information; and
- which country’s law applies.
That does not mean every NDA needs to be ten pages long and full of legal jargon. Quite the opposite.
A good NDA should be clear, proportionate and appropriate for the information being protected.
If you’re looking for an NDA template UK businesses can adapt to their circumstances, you can view our range of Non-Disclosure Agreement templates here.
What about an employee NDA template UK?
Businesses sometimes search specifically for an employee NDA template when they are concerned about staff having access to confidential information.
However, in many cases, confidentiality obligations are better dealt with as part of the employee’s employment contract rather than through a completely separate NDA.
Employees will naturally have access to confidential business information as part of their role, so the employment contract should clearly explain what they must keep confidential both during and, where appropriate, after their employment.
There may still be situations where a separate confidentiality agreement is useful, particularly where an employee is going to be given access to unusually sensitive information.
The important point is to make sure the documents work together rather than simply adding another agreement because it contains the words “Non-Disclosure Agreement”.
Can an NDA stop somebody competing with you?
Not usually. An NDA is primarily concerned with the disclosure and misuse of confidential information. It is not the same thing as a non-compete agreement.
You may be able to prevent someone from using your confidential information to compete with you, but simply signing an NDA does not mean they can never create a similar business, work with a competitor or operate in the same industry. Any wider restrictions need to be carefully drafted and considered separately.
Should you sign someone else’s NDA?
It is also worth remembering that you may be the person being asked to sign an NDA. Before signing, check what you are actually agreeing to.
In particular, look at:
- how widely confidential information is defined;
- how long the obligations continue;
- what information you can share with employees or advisers;
- whether you are accepting liability for other people’s actions;
- any restrictions that go beyond confidentiality;
- intellectual property provisions; and
- the law and jurisdiction applying to the agreement.
Just because a document is described as a “standard NDA” does not mean you should sign it without reading it
Protect confidential information before you share it
The best time to think about confidentiality is before commercially sensitive information leaves your hands. Once confidential information has been shared without appropriate protections, it can be much harder to control what happens to it. That’s wht a properly drafted NDA gives both parties clarity from the outset about what is confidential, why it is being disclosed and how it can be used. And it does not need to be unnecessarily complicated.
Frequently Asked Questions
Is an NDA legally binding in the UK?
Yes, an NDA can be legally binding in the UK provided it is properly drafted and the usual requirements for a valid contract are met. The wording should clearly explain what information is confidential and what the recipient can and cannot do with it.
Can I use a standard NDA template UK businesses use?
Yes, provided the template is suitable for your situation. You should check whether you need a one-way or mutual NDA and whether the wording properly covers the information you are sharing.
How long should an NDA last in the UK?
There is no set period. The appropriate length will depend on the type of information being protected and how long it is likely to remain commercially sensitive.
Do I need an employee NDA?
Not always. Confidentiality obligations are often included within an employment contract. A separate NDA may be useful where an employee will have access to particularly sensitive information.
Should I sign an NDA before sharing confidential information?
Ideally, yes. It is usually much easier to agree how confidential information can be used before it is disclosed rather than trying to impose restrictions afterwards.
Need a UK NDA template?
We have a range of legally drafted NDA templates available through our online store, giving you a straightforward and cost-effective way to put appropriate confidentiality provisions in place.
Browse our UK Non-Disclosure Agreement templates here.
And if your arrangement is more unusual, or you are dealing with particularly valuable intellectual property, designs, technology or commercially sensitive information, we can also help with bespoke drafting or amendments to make sure the agreement reflects what you actually need to protect.