NDA Core Confidentiality Obligation Clause

An NDA Core Confidentiality Obligation Clause is a primary contractual confidentiality-establishing NDA provision that establishes NDA baseline duties not to disclose or misuse NDA confidential information by NDA receiving parties.

AKA: NDA Primary Confidentiality Clause, NDA Baseline Confidentiality Provision, NDA Fundamental Confidentiality Obligation.
Context:
- It can typically establish NDA Confidential Information Definition with NDA material scope boundaries.
- It can typically prohibit NDA Unauthorized Disclosure through NDA disclosure restriction.
- It can typically restrict NDA Unauthorized Use via NDA use limitation.
- It can typically mandate NDA Information Protection using NDA reasonable measures.
- It can typically require NDA Need-to-Know Basis for NDA internal sharing.
- It can typically impose NDA Non-Circumvention Duty preventing NDA indirect disclosure.
- It can typically specify NDA Confidentiality Duration through NDA term specification.
- It can typically create NDA Affirmative Protection Duty requiring NDA proactive safeguards.
- It can typically establish NDA Information Handling Protocol for NDA secure processing.
- It can typically mandate NDA Disclosure Tracking through NDA access logs.
- ...
- It can often include NDA Third-Party Disclosure Controls with NDA representative restrictions.
- It can often establish NDA Standard of Care Requirements for NDA information handling.
- It can often mandate NDA Equivalent Protection for NDA authorized recipients.
- It can often create NDA Downstream Liability for NDA representative breaches.
- It can often require NDA Written Consent for NDA permitted disclosure.
- It can often incorporate NDA Incident Response Obligations for NDA breach notification.
- It can often reference NDA Industry-Specific Standards for NDA protection level.
- It can often implement NDA Information Classification through NDA sensitivity tiers.
- It can often require NDA Encryption Requirement for NDA digital transmission.
- It can often establish NDA Audit Trail Requirement for NDA compliance verification.
- It can often mandate NDA Secure Destruction Protocol for NDA information disposal.
- It can often include NDA Cross-Border Transfer Restriction for NDA international compliance.
- ...
- It can range from being a Simple NDA Core Confidentiality Obligation Clause to being a Comprehensive NDA Core Confidentiality Obligation Clause, depending on its NDA obligation scope.
- It can range from being a Unilateral NDA Core Confidentiality Obligation Clause to being a Mutual NDA Core Confidentiality Obligation Clause, depending on its NDA party reciprocity.
- It can range from being a Narrow NDA Core Confidentiality Obligation Clause to being a Broad NDA Core Confidentiality Obligation Clause, depending on its NDA information coverage.
- It can range from being a Fixed-Term NDA Core Confidentiality Obligation Clause to being a Perpetual NDA Core Confidentiality Obligation Clause, depending on its NDA duration model.
- It can range from being a Absolute NDA Core Confidentiality Obligation Clause to being a Conditional NDA Core Confidentiality Obligation Clause, depending on its NDA carve-out structure.
- It can range from being a Passive NDA Core Confidentiality Obligation Clause to being an Active NDA Core Confidentiality Obligation Clause, depending on its NDA protection requirement intensity.
- It can range from being a Generic NDA Core Confidentiality Obligation Clause to being an Industry-Specific NDA Core Confidentiality Obligation Clause, depending on its NDA sector customization.
- ...
- It can integrate with NDA Definition Clause to establish NDA information scope.
- It can work with NDA Permitted Disclosure Exception for NDA disclosure framework.
- It can support NDA Remedies Provision through NDA breach consequences.
- It can enable NDA Compliance Monitoring via NDA audit rights.
- It can coordinate with NDA Return Obligation for NDA termination procedures.
- It can interact with NDA Equitable Relief Cooperation Provision for NDA enforcement mechanisms.
- It can complement NDA Need-to-Know Restriction Clause for NDA access control.
- It can reinforce NDA Standard of Care Provision through NDA protection standards.
- It can support NDA Third-Party Disclosure Control Provision via NDA recipient obligations.
- ...
Example(s):
- Standard NDA Core Confidentiality Obligation Patterns, such as:
  - NDA Non-Disclosure and Non-Use Pattern: "Receiving Party shall not disclose Confidential Information to any third party and shall not use Confidential Information for any purpose other than the Permitted Purpose."
  - NDA Protection Standard Pattern: "Receiving Party shall protect Confidential Information using the same degree of care it uses to protect its own confidential information, but in no event less than reasonable care."
  - NDA Need-to-Know Pattern: "Receiving Party may disclose Confidential Information only to its employees, agents, and representatives who have a legitimate need to know and are bound by confidentiality obligations at least as restrictive as those herein."
  - NDA Incident Notification Pattern: "Receiving Party shall promptly notify Disclosing Party upon discovery of any unauthorized use or disclosure of Confidential Information."
  - NDA Legal Compliance Pattern: "If Receiving Party is compelled by law to disclose Confidential Information, it shall provide Disclosing Party with prior written notice and cooperate in seeking a protective order."
- Industry-Specific NDA Core Confidentiality Obligation Clauses, such as:
- Specialized NDA Core Confidentiality Obligation Implementations, such as:
- Temporal-Based NDA Core Confidentiality Obligation Clauses, such as:
- ...
Counter-Example(s):
- General Confidentiality Policy, which provides organizational guidelines rather than NDA contractual obligations.
- Privacy Notice, which addresses data subject rights rather than NDA contractual duties.
- Trade Secret Protection Measure, which relies on statutory protection rather than NDA contractual framework.
- Public Disclosure Statement, which announces rather than restricts information sharing.
- Terms of Service Confidentiality Section, which creates user obligations rather than NDA party obligations.
- Employee Confidentiality Agreement, which governs employment relationships rather than NDA business transactions.
- Informal Confidentiality Understanding, which lacks NDA legal enforceability.
- Marketing Non-Disclosure Request, which requests rather than requires NDA information protection.
See: Non-Disclosure Agreement (NDA) Document, NDA Obligation of Confidentiality Article, NDA Third-Party Disclosure Control Provision, NDA Standard of Care Provision, NDA Incident Response Obligation, NDA Downstream Liability Provision, NDA Need-to-Know Restriction Clause, NDA Equitable Relief Cooperation Provision, Contractual Obligation, Confidentiality Clause, Contract-Focused Playbook.

References

2025-07-04

Deep Research https://chatgpt.com/s/dr_6868483295b08191aa56c6743c6e4030
- Question: What are the key components and typical terms of an NDA core confidentiality obligation clause?
- Answer: An NDA core confidentiality obligation clause (also called the primary confidentiality clause or baseline confidentiality provision) is the central contract term in a Non-Disclosure Agreement (NDA) that establishes the receiving party's fundamental duty to keep the disclosing party's information secret and not misuse it.
  - Key Components:
    - Clear Definition of Confidential Information: Most NDAs first define what information is deemed "Confidential" and subject to protection. This definition sets the scope and boundaries of the clause – covering trade secrets, technical data, business plans, customer lists, etc.
    - Non-Disclosure Obligation: The core clause prohibits the receiving party from disclosing the confidential information to any outside party, except as permitted by the NDA. The clause carves out an exception allowing internal disclosures on a strict need-to-know basis.
    - Non-Use Obligation: NDAs restrict how the receiving party can use the information. The confidential info can only be used for the specific purpose for which it was disclosed and not for any other purpose or competitive advantage.
    - Standard of Care: The clause requires the receiving party to protect the confidential information using at least "reasonable" protection, or with the same degree of care it uses to protect its own similar confidential information.
    - Need-to-Know and Third-Party Controls: Good confidentiality clauses allow the receiving party to share information internally or with advisors on a need-to-know basis under strict conditions. The receiving party is generally responsible for any breaches by its representatives.
    - Confidentiality Duration: Many NDAs impose confidentiality for a fixed period (commonly 1 to 5 years after disclosure or after the NDA ends). Some NDAs state that trade secrets must be kept confidential indefinitely or for as long as the information remains a trade secret.
    - Permitted Disclosure Exceptions: Virtually all NDA confidentiality clauses include standard exceptions where the confidentiality obligations do not apply. Common carve-outs include information that: is or becomes publicly available through no fault of the recipient; was already known by the recipient before disclosure; is independently developed by the recipient; or is lawfully obtained from a third party.
    - Written Consent for Any Other Disclosure: NDAs typically state that any disclosure beyond what is expressly allowed requires the disclosing party's prior written consent. Many confidentiality clauses include phrasing like "shall not disclose to any third party without the prior written consent of the Disclosing Party, except as provided herein."
    - Return or Destruction of Materials: At the conclusion of the NDA or upon the disclosing party's request, the receiving party must return or destroy all confidential materials provided. This return/destruction obligation helps enforce the notion that the info was only "loaned" for a particular purpose.
  - Examples of Confidentiality Obligation Clauses:
    - Mutual NDA Example: "Each party agrees that it will not disclose to any third party any Confidential Information of the other party, except to its employees or consultants as necessary to perform its obligations under this Agreement, and that it will take all reasonable measures to maintain the confidentiality of all Confidential Information of the other party in its possession or control, which measures will in no event be less than those it uses to protect its own information of similar importance."
    - Unilateral NDA Example: "The Recipient agrees to keep all Confidential Information received from the Discloser strictly confidential and shall not disclose such information to any third party without the Discloser's prior written consent, except for disclosures allowed by this Agreement. The Recipient further agrees to use the Confidential Information solely for the purpose of [evaluating the business opportunity] and not for any other purpose."
  - Near-Related Counter-Examples:
    - Weak NDA clauses might only say "Information X is confidential" without clearly stating the recipient's obligations not to disclose or misuse it.
    - Overly broad or "absolute" clauses declaring that "All information exchanged shall remain confidential indefinitely, without exception" can be unworkable or even unenforceable.
    - Clauses omitting use restrictions allow a recipient to argue they didn't breach the NDA if they quietly utilized the information for their own benefit without disclosing it.
- Citations:

[1] G. Melli, "Confidential Information Protection-Focused Clause," GM-RKB - http://www.gabormelli.com/RKB/Confidential_Information_Protection-Focused_Clause
[2] Wikipedia, "Non-disclosure agreement" - https://en.wikipedia.org/wiki/Non-disclosure_agreement
[3] Sterlington PLLC, "Non-Disclosure Agreements: 10 Key Provisions You Need to Know" - https://www.sterlingtonlaw.com/key-provisions-of-non-disclosure-agreements/
[4] Sirion.ai, "Create Effective Confidentiality Clauses: A Comprehensive Guide" - https://www.sirion.ai/library/contract-clauses/confidentiality-clauses/
[5] Law&Bar Academy, "How to write a 'Confidentiality Clause'" - https://www.lawandbar.com/article-legal-clauses/
[6] Thomson Reuters (Practical Law), "NDAs and Confidentiality Agreements: What You Need to Know" - https://legal.thomsonreuters.com/en/insights/articles/confidentiality-agreements
[7] Contract Nerds (R. Gondwe), "Stick to the Core: 8 Essential Provisions of Non-Disclosure Agreements" - https://contractnerds.com/stick-to-the-core-8-essential-provisions-of-non-disclosure-agreements/
[8] Morgan Lewis, "Cracks in the Confidentiality Exception Boilerplate" - https://www.morganlewis.com/blogs/sourcingatmorganlewis/2021/08/cracks-in-the-confidentiality-exception-boilerplate
[9] Legislate.ai, "An overview and breakdown of the key clauses in an NDA" - https://www.legislate.ai/blog/key-clauses-in-an-nda
[10] Fynk.com, "Confidentiality Clause: Essential Elements and Best Practices" - https://fynk.com/en/clauses/confidentiality-clause/

NDA Core Confidentiality Obligation Clause

References

2025-07-04

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