How can you ensure confidentiality and avoid non-disclosure breaches in contract templates?

2 Include exceptions and exclusions

The second step is to include any exceptions or exclusions that may apply to the confidentiality obligation. For example, you may want to allow the disclosure of confidential information to certain third parties, such as subcontractors, consultants, or regulators, as long as they agree to keep it confidential as well. You may also want to exclude any information that the recipient already knew, obtained from another source, or independently developed without using your confidential information. These exceptions and exclusions can help you avoid disputes and litigation in case of accidental or unavoidable disclosure.

3 Specify the remedies for breach

The third step is to specify what happens if the confidentiality obligation is breached. You should state the consequences and remedies that you can seek in case of unauthorized use or disclosure of your confidential information. For example, you may want to include an injunction, damages, termination of the contract, or return or destruction of the confidential information. You should also state whether the confidentiality clause is severable from the rest of the contract, meaning that it can still be enforced even if other parts of the contract are invalid or unenforceable.

4 Use plain and clear language

The fourth step is to use plain and clear language in your confidentiality clause. You should avoid jargon, ambiguity, and inconsistency that may confuse or mislead the recipient of your confidential information. You should also use consistent terms and definitions throughout the contract and refer to any relevant attachments or exhibits. You should also make sure that your confidentiality clause is compatible with the laws and regulations of the jurisdiction where you operate or where the contract is governed.

5 Review and update your templates regularly

The fifth step is to review and update your confidentiality clause and your contract templates regularly. You should check for any changes in the legal, regulatory, or industry standards that may affect your confidentiality obligations and expectations. You should also solicit feedback from your clients, vendors, partners, and employees on how they perceive and comply with your confidentiality clause. You should also monitor and audit your confidential information and how it is used or disclosed by the recipients. By reviewing and updating your templates regularly, you can ensure that they reflect your current needs and goals and that they are effective in avoiding non-disclosure breaches.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?