The investor’s field guide · N
Non-disclosure agreement
A contract setting limits on how confidential information may be used and shared.
Explained by the editorial team
A non-disclosure agreement, often called an NDA or confidentiality agreement, governs information shared for a particular purpose. In a business sale, it may allow a potential buyer to review sensitive material while restricting disclosure to others or use outside the proposed transaction.
How it works
The agreement should identify protected information, permitted recipients and permitted uses. Advisers may need access, but their involvement should fit the agreement. Information already public or lawfully obtained elsewhere is often treated differently, depending on the wording.
What to examine
Check duration, return or destruction requirements and any restrictions beyond confidentiality. Some documents contain non-solicitation, non-circumvention or other commercial obligations. An NDA does not confirm that the information is accurate, grant permission to share it publicly or commit either party to a deal. Enforceability and remedies depend on the jurisdiction. Share only what you are authorised to disclose and seek advice if the restrictions could affect your existing work.
General information, not investment, legal or tax advice. Examples are illustrative. Read the disclaimer.