CONFIDENTIALITY AGREEMENT
Protection of business secrets is a central part of companies risk management. Business secrets are often the most important property the company has and business secrets often have a considerable effect on the value of the company.
The Employment Contracts Act, the Criminal Code and the Unfair Business Practices Act regulate how the business secrets are protected. According to the Employment Contracts Act an employee is not allowed to take advantage of or talk about employers professional and company secrets during the employment period. In the Criminal Code violation of the duty of confidentiality is regulated as punishable act. In the Unfair Business Practices Act no one can unlawfully obtain or try to obtain information relating to business secrets or use or talk about information that was received unlawfully.
Confidentiality agreement should be used as a part of an employee's employment agreement or as a separate contract when the employee deals with business secrets. Confidentiality agreement should also be used in different shareholders', co-operation, retail, franchising, licensing, software, manufacturing, subcontracting and export and import agreements.
The benefits of a confidentiality agreement are that it can be used to define what is confidential information and how much are the contractual penalties that result from a breach among other things.
Use of the confidentiality agreements also increases the value of a company. During business acquisitions the buyer assesses how the business secrets are being protected and have the appropriate confidentiality agreements been made among other things.
View also agreement on prohibition of competition
