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Non-Disclosure Agreement
I need a non-disclosure agreement to protect sensitive business information during discussions with a potential partner, ensuring confidentiality for a period of 3 years, with clear definitions of confidential information and exclusions, and including provisions for legal remedies in case of breach.
What is a Non-Disclosure Agreement?
A Non-Disclosure Agreement protects sensitive business information by creating a legal duty to keep specific details confidential. Companies across South Africa use these contracts when sharing trade secrets, client lists, or strategic plans with employees, contractors, or business partners.
Under South African common law and the Protection of Personal Information Act (POPIA), NDAs help organizations maintain control over their confidential data. They spell out what information must stay private, how long the secrecy lasts, and what happens if someone breaks the agreement. Courts can enforce these agreements through damages claims or interdicts when breaches occur.
When should you use a Non-Disclosure Agreement?
Use a Non-Disclosure Agreement before sharing sensitive business information with anyone outside your immediate team. This includes discussions with potential investors, negotiations with suppliers, hiring new employees, or exploring partnerships. The agreement creates clear legal boundaries around confidential data before it changes hands.
South African businesses need NDAs most when sharing trade secrets, customer databases, financial projections, or technical innovations. Many companies make signing an NDA the first step in merger talks, joint ventures, or bringing on specialized contractors. This protection becomes especially important when dealing with information that falls under POPIA or could give competitors an advantage.
What are the different types of Non-Disclosure Agreement?
- Nondisclosure Agreement: Standard comprehensive version for general business use, covering both parties equally
- Employee Confidentiality Agreement: Specifically designed for employer-employee relationships, often part of employment contracts
- Simple Confidentiality Agreement: Streamlined version for straightforward situations with basic confidentiality needs
- NDA And Confidentiality Agreement: Enhanced version with detailed confidentiality provisions for complex business dealings
- Non Disclosure Agreement Form: Fill-in-the-blank format for quick customization while maintaining legal validity
Who should typically use a Non-Disclosure Agreement?
- Business Owners: Need Non-Disclosure Agreements to protect company secrets, intellectual property, and strategic plans when dealing with external parties
- Employees: Sign NDAs as part of their employment contracts, binding them to protect company information during and after employment
- Independent Contractors: Must agree to confidentiality terms before accessing sensitive project details or client information
- Legal Practitioners: Draft and review NDAs to ensure compliance with South African law and enforceability in local courts
- Investors and Partners: Required to sign NDAs before receiving access to financial data, business plans, or proprietary technology
How do you write a Non-Disclosure Agreement?
- Identify Parties: Gather full legal names, registration numbers, and contact details of all parties who will be bound by the NDA
- Define Information: List specific types of confidential information to be protected, from trade secrets to customer data
- Set Time Frames: Determine how long the confidentiality obligations will last and when information sharing begins
- Outline Permissions: Specify who can access the information and under what circumstances
- Add Protection Measures: Detail how confidential information must be stored, shared, and eventually destroyed
- Consider POPIA: Include specific provisions for personal information protection under South African law
What should be included in a Non-Disclosure Agreement?
- Party Details: Full legal names, addresses, and registration numbers of all parties involved
- Definition Clause: Clear description of what constitutes confidential information under South African law
- Scope of Obligations: Specific duties to maintain confidentiality and permitted uses of information
- Duration Terms: Clear timeframe for confidentiality obligations and survival provisions
- POPIA Compliance: Specific provisions for handling personal information under data protection laws
- Breach Consequences: Remedies and enforcement mechanisms available under South African law
- Signature Block: Space for dated signatures, witness details, and company representatives
What's the difference between a Non-Disclosure Agreement and a Non-Compete Agreement?
A Non-Disclosure Agreement differs significantly from a Non-Compete Agreement in both scope and purpose, though they're often used together in South African business contracts. While both protect business interests, they serve distinct functions and have different enforcement mechanisms under local law.
- Focus of Protection: NDAs specifically protect confidential information and trade secrets, while non-compete agreements prevent competitive business activities
- Duration and Scope: NDAs can last indefinitely for trade secrets, but non-compete agreements must have reasonable time and geographic limits to be enforceable in South African courts
- Legal Requirements: NDAs need clear definition of confidential information, while non-compete agreements must prove legitimate business interests and reasonable restrictions
- Enforcement Approach: NDAs typically seek damages for information breaches, while non-compete enforcement often requires urgent interdicts to stop competitive activity
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