Confidentiality agreement: a reliable way to prevent disclosure of IPRs owner's confidential information

IPRs owners, especially inventors, from the creation of idea up to its commercialization are often faced with disclosure of confidential information delivered to third parties during license agreement negotiations. In fact, the main purpose of confidentiality agreements is to protect different types of IPRs including know-how, trade secrets, etc. with a view to prepare the background for proper and effective supervision and management of their exploitation. The use of non-disclosure agreements in high-tech sector, specifically for computer and internet companies is a common in license agreement negotiations. On the other hand, researchers and inventors in knowledge-based companies may be faced with challenges like disclosure of confidential information in the process of acquiring IPRs protection. The important point is the ignorance of many idea owners and inventors as to how such agreements are concluded. When delivering confidential information, non-disclosure agreement covers merely this information and is concluded for its protection before license agreement is concluded or during license agreement negotiations. Signing and entering into such agreements, without knowledge of laws and their characteristics, may cause dangerous and heavy obligations for parties. In this paper, with an analytic-descriptive approach, we define non-disclosure agreement, its necessity, function, types and common terms and conditions. The results of this paper indicate the necessity of delivering accurate and efficient information to IPRs owners regarding entering into confidentiality agreements and the need to modify the current legal structure in order to protect their rights.