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Non-Disclosure Agreement (NDA) Template with a Lawyer's Commentary

NON-DISCLOSURE AGREEMENT (NDA)

concluded on the day, month and year stated below pursuant to Section 1746(2) et seq. of Act No. 89/2012 Coll., the Civil Code, as amended (hereinafter the “Civil Code”)

I. Contracting Parties

Disclosing Party: [Company Name], ID No.: [ID No.], with its registered office at [Address], registered in the Commercial Register maintained by [Court], Section [Section], Insert [Insert] represented by: [Name and position of the executive] (hereinafter the “Disclosing Party”)

and

Receiving Party: [Company Name], ID No.: [ID No.], with its registered office at [Address], registered in the Commercial Register maintained by [Court], Section [Section], Insert [Insert] represented by: [Name and position of the executive] (hereinafter the “Receiving Party”)

ARROWS Commentary: The identification of the contracting parties must be completely accurate and error-free. Always use current data from the Commercial Register. If the agreement is concluded by a natural person, state their name, surname, date of birth, and permanent residence address.

II. Purpose of the Agreement

1. The purpose of this agreement is to protect the Disclosing Party's confidential information that will or may be provided to the Receiving Party in connection with [Define the purpose precisely here, e.g., negotiations on potential business cooperation in the area of..., conducting an audit, preparing for a company merger...]. (hereinafter the “Purpose”).

ARROWS Commentary: The most precise definition of the Purpose is crucial. The court will use it to assess whether the Receiving Party used the information in accordance with the agreement. Vague phrases like “for the purpose of cooperation” are insufficient and risky. Need help with the exact wording? Email us at consultation@arws.cz.

III. Definition of Confidential Information

1. For the purposes of this agreement, confidential information shall mean all information of a commercial, manufacturing, technical, economic, operational, or other nature that has actual or at least potential value, is not commonly available in the relevant business circles, and is intended to be kept secret at the will of the Disclosing Party.

2. This includes, but is not limited to: trade secrets, know-how, financial data, business plans, marketing strategies, customer and supplier lists, source codes, technical drawings, data from internal systems, and any other information that the Disclosing Party designates as “confidential”.

ARROWS Commentary: This is the most important part of the agreement. We recommend being as specific as possible. The better you define the information, the stronger your protection will be. We would be happy to review with you which information is key to your business and how best to describe it in the agreement. Contact us at consultation@arws.cz.

IV. Obligations of the Receiving Party

1. The Receiving Party undertakes to: a) Maintain the confidentiality of all confidential information. b) Use the confidential information exclusively for the fulfillment of the Purpose. c) Not to disclose or make available the confidential information to any third party without the prior written consent of the Disclosing Party. d) Take reasonable measures to protect the confidential information from loss, misuse, or unauthorized disclosure.

V. Duration

1. The confidentiality obligation under this agreement shall last for a period of [specify number of years, e.g., 5 years] from the date of conclusion of this agreement, unless the parties agree otherwise. The confidentiality obligation shall survive the termination of cooperation negotiations between the parties.

ARROWS Commentary: The duration must be reasonable given the nature of the information. For trade secrets, it can even be agreed for an unlimited period. Incorrectly setting the duration can lead to the invalidity of the provision. We can help you determine the optimal duration based on an analysis of your needs. Contact us at consultation@arws.cz.

VI. Contractual Penalty

1. In the event that the Receiving Party breaches any obligation set out in Article IV of this agreement, it shall be obliged to pay the Disclosing Party a contractual penalty in the amount of [e.g., CZK 250,000] for each individual case of breach.

2. The claim for a contractual penalty shall not affect the Disclosing Party's right to full compensation for damages.

ARROWS Commentary: The contractual penalty is a key deterrent and sanctioning tool. Its amount must be significant but not ruinous. We will help you set its amount to be enforceable and effective. For a consultation, email us at consultation@arws.cz.

VII. Final Provisions

1. This agreement is governed by the laws of the Czech Republic. All disputes arising from this agreement shall be resolved before the [e.g., Municipal Court in Prague].

2. This agreement is made in two counterparts, one for each party.

3. Amendments to this agreement may only be made in the form of written, numbered addenda signed by both parties.

In [City] on [Date]

Disclosing Party: [Company Name] [Name and position of the executive]

In [City] on [Date]

Receiving Party: [Company Name] [Name and position of the executive]

Why is a Non-Disclosure Agreement (NDA) crucial for your business?

A Non-Disclosure Agreement (NDA) is a contract that obligates one or both parties to protect and not disclose entrusted information. It's not just a formal document. It is a necessity for anyone who wants to deal securely with business partners, investors, employees, or external suppliers. Underestimating this step can lead to the disclosure of business plans, loss of competitive advantage, or damage to your reputation.

A properly drafted NDA protects your most valuable assets – data, strategies, and ideas. At ARROWS, we draft and review these agreements on a daily basis, and we know how crucial it is to tailor them to the specific situation. Do you need legal assistance with preparing a custom NDA? Contact us at consultation@arws.cz.

When is the right time to use an NDA?

Many entrepreneurs hesitate about when to require a non-disclosure agreement. The general rule is simple: whenever you are about to share information that you consider confidential and whose leakage could harm you.

Typical situations include:

• Negotiating with a potential investor or buyer of your company.

• Starting a collaboration with a new business partner.

• Recruiting key employees who will have access to sensitive data.

• Outsourcing work to external contractors (freelancers, agencies) involved in your projects.

• Presenting a new product or technological solution.

Our Prague-based lawyers at ARROWS will help you not only with the preparation of the agreement itself but also with setting up internal processes for information protection. For an immediate solution to your situation, email us at consultation@arws.cz.

Risk Table: Generic NDA Template vs. Custom Solution from ARROWS

Protecting know-how abroad? No problem with us

Do you operate internationally? Then you need protection that crosses borders. Thanks to our ARROWS International network, built over ten years, we handle cases with an international element on a daily basis. We will ensure that your non-disclosure agreements are enforceable abroad and comply with local legal practices. Comprehensive protection of intellectual property is the foundation of a healthy business. You can find more about this service on our website in the Trademarks, Intellectual Property (IP) section.

Whether you are negotiating with a partner from Germany, the USA, or Asia, our EU-based lawyers are ready to help you – write to consultation@arws.cz.

In conclusion: A template is a start, a custom solution is the goal

The provided template is an excellent starting point. It shows the structure and key points that must not be missing. However, it can never replace a document prepared by a lawyer who knows the context of your business and its specific risks. The investment in a quality, custom-made NDA is a fraction of what you could lose from a leak of sensitive data.

Our Czech legal team is ready to help you with the review, modification, or complete preparation of a non-disclosure agreement. Based on our experience in managing a portfolio of over 150 joint-stock companies and 250 limited liability companies, we know how to prepare documents to be truly functional. Do not hesitate to contact our firm – consultation@arws.cz.