A non-disclosure agreement protects information you are about to share. It cannot protect information you have already given away.
When one is worth having
- Discussing a business idea with a potential partner or investor
- Giving a contractor access to customer data or pricing
- Sharing product designs or formulations with a supplier
- Due diligence in a sale or joint venture
- Employees with access to trade secrets
One-way or mutual
A one-way NDA protects one party disclosing to another. A mutual NDA protects both, and is standard where two businesses are exploring something together.
Insisting on a one-way NDA when both sides will share information reads as inexperience.
What it should cover
| Clause | Why it matters |
|---|---|
| Definition of confidential information | Too narrow protects nothing; too broad is unenforceable |
| Permitted use | What they may do with it |
| Exclusions | Public knowledge, or information they already had |
| Duration | How long the obligation lasts |
| Return or destruction | What happens when talks end |
| Governing law | South African law, and which courts |
What an NDA cannot do
It cannot stop someone independently developing the same idea. It cannot protect information already in the public domain. It cannot prevent disclosure required by law.
It also cannot un-share what you disclosed before signing. Sign first, then talk.
Most NDAs are never litigated. Their value is that they make the obligation explicit, create a record, and cause the other party to take confidentiality seriously.
Enforcement means proving breach and proving loss, which is difficult and expensive. Treat an NDA as a deterrent and a record, not a guarantee.
Restraint of trade is different
An NDA protects information. A restraint of trade limits where and for whom someone may work afterwards. South African courts enforce restraints only where they protect a legitimate interest and are reasonable in scope, duration and area.
Do not assume a broad restraint will hold.
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General information, not legal advice. Lightbizhub is not a law firm. For complex, disputed or high-value matters, have any document reviewed by an admitted attorney before you rely on it.