What should an NDA include in the UK?

A UK NDA should define confidential information clearly, list standard exclusions, state how long obligations last, set out permitted disclosures, require return or destruction of information, and confirm the governing law and remedies. The best NDAs are tight on what is protected, generous on what is excluded, and short enough that both sides read them.

The six clauses every NDA needs

1. Definition of confidential information

The definition decides what the agreement protects. A good one has three parts: a general description ("information that is non-public, including technical, commercial and financial information"), a non-exhaustive list of examples relevant to the deal (source code, customer lists, pricing, roadmaps, financial models), and a marking requirement for anything disclosed orally ("confirmed in writing within 14 days").

Avoid "any information disclosed by either party". Courts dislike definitions this broad because they give the recipient no way to know what is covered. UK case law in commercial confidentiality disputes rewards specificity, not fishing nets.

2. Standard exclusions

An NDA should carve out five things from the definition, because none of them are secret in a meaningful sense:

• Information that was already in the receiving party's possession before disclosure.
• Information that is or becomes publicly known other than through a breach of the NDA.
• Information independently developed by the receiving party, without reference to the disclosed information.
• Information obtained from a third party who is lawfully entitled to disclose it.
• Information required to be disclosed by law, court order or regulatory authority (subject to a notice obligation where legally permitted).

Without these carve-outs, the recipient is exposed to claims for information they never actually "received" from you.

3. Duration

A standard commercial NDA runs 2 to 5 years from the date of signature, with a longer tail for trade secrets. Indefinite obligations are tempting but are harder to enforce in practice and can be rejected outright by larger counterparties. If the deal is a one-off introduction, 2 years is usually enough. If it is ongoing or involves genuine trade secrets (manufacturing know-how, proprietary algorithms), 5 years with a longer separate tail on trade secrets is common.

4. Permitted disclosures

The recipient almost always needs to show the information to someone, a lawyer, an accountant, a bank, an investor, a specific employee. A good NDA permits disclosure to:

• The recipient's own employees, officers, directors and professional advisors (lawyers, accountants, investment bankers) on a need-to-know basis.
• Potential financing sources and their advisors, subject to similar confidentiality obligations.
• Anyone the law requires, with prior notice where legally permitted.

Each permitted recipient should be subject to confidentiality obligations at least as strict as the NDA itself, and the disclosing party remains responsible for breaches by those recipients.

5. Return or destruction

At the end of the discussions, or at the discloser's written request, the recipient should return or destroy the confidential information and certify the destruction in writing. Build in reasonable exceptions: electronic back-ups made in the ordinary course of IT operations, information retained to comply with regulatory record-keeping, and legal archives subject to continuing confidentiality.

6. Governing law and remedies

The NDA should state the governing law (England and Wales is standard for UK commercial deals) and the jurisdiction for disputes. On remedies, two points matter:

• Damages are the primary remedy, but the agreement should also preserve the right to seek injunctive relief, because the harm from a breach of confidence is often hard to quantify in money.
• Avoid attempts to pre-agree a penalty figure for breach. English law treats these as unenforceable penalty clauses unless they are a genuine pre-estimate of loss.

Clauses to be cautious about

Some NDAs push beyond confidentiality into territory that can restrict your business in ways you did not intend to agree.

• Non-solicitation of employees or customers. Legitimate for the duration of discussions and shortly after, but should be time-limited and tied to actual contact.
• Non-compete. NDAs are not the right place for non-competes; if the counterparty wants one, make it a separate, carefully-drafted agreement.
• Exclusivity. A clause that prevents you from talking to anyone else about a similar deal belongs in a term sheet or exclusivity agreement, not an NDA.
• Assignment of IP in received materials. You are receiving information for a specific purpose. You should not be assigning any IP in your own developments as a side effect of signing an NDA.

Mutual versus one-way

A mutual NDA protects both parties and is appropriate when both will share confidential information. It is usually quicker to agree because it is symmetric.

A one-way NDA protects only the disclosing party. It is appropriate when only one side will share confidential information, for example an investor doing due diligence on a company. If you are being asked to sign a one-way NDA when both sides will share information, propose making it mutual.

Common pitfalls

• Definition too broad, "all information" with no exclusions means the recipient has no safe operating space. Negotiate specificity.
• No time limit, indefinite obligations are hard to enforce and often rejected by sophisticated counterparties.
• No permitted disclosures, if the recipient cannot show the information to their lawyer or their board, the NDA is impractical.
• Non-solicit or non-compete creep, these are separate agreements, not NDA boilerplate.
• Wrong governing law, if your business is in England and Wales, agreeing to another jurisdiction creates unnecessary cost in a dispute.

Frequently asked questions

Should I get an NDA reviewed before signing?

Yes, if the NDA is one-sided, has no time limit, defines confidential information very broadly, or includes non-solicitation or non-compete wording. These can restrict your business long after the deal.

How long should an NDA last?

Two to five years from signature is standard for commercial NDAs. Longer for trade secrets. Indefinite obligations are often rejected by larger counterparties.

Mutual or one-way?

If both parties will share confidential information, make it mutual. If only one party will, a one-way NDA is appropriate.

How much does an NDA review cost?

MrBondLegal reviews an NDA from £90, with sign-off by an SRA-regulated solicitor, typically within 24 hours.