Clause guide
Confidentiality clause: meaning, risks, and what to negotiate
Restricts how confidential information can be used, shared, or stored.
What it means
Confidentiality clauses protect sensitive business information, but vague or overly broad language can create heavy obligations or operational issues.
Common risks
- • The definition of confidential information may be too broad.
- • Your team may face burdensome use, return, or deletion requirements.
- • There may be no clear exceptions for public, pre-existing, or independently developed information.
What to check before signing
- • How is confidential information defined?
- • Are standard exceptions included?
- • How long do the obligations last?
Negotiation ideas
- • Narrow the definition to non-public business information.
- • Add standard exclusions and compelled disclosure language.
- • Set a reasonable confidentiality period.
Example clause
“Each party shall keep the other party’s Confidential Information strictly confidential and use it only for purposes of performing this Agreement.”
Frequently asked questions
How long should confidentiality last?
Many agreements use 2 to 5 years, though trade secrets are sometimes protected for longer.
Related clauses
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