TRW & Co · Commercial contracts
Non-Disclosure Agreements in the UK: When and How to Use Them
A non-disclosure agreement protects confidential information shared for a defined purpose, from deal talks to technology partnerships. This NDA UK guide explains when to use a one-way or mutual NDA, how to define confidential information so it can be enforced, what remedies a court can grant, and the growing legal limits on NDAs in employment and settlement agreements.
Key pointThe definition of confidential information and your records of what you disclosed matter more than the remedies clause: a court will only restrain use of information you can identify precisely, and broad residuals clauses in a counterparty's template can quietly hollow out the whole agreement.
At a glance
Contract plus equity
An NDA adds contractual rights to the equitable duty of confidence and helps show reasonable steps to keep trade secrets secret under the 2018 Regulations.
One-way or mutual
Use a one-way NDA when only one side discloses; mutual NDAs suit joint ventures and collaborations where both sides share information.
Injunctions are key
Interim injunctions can stop misuse quickly; delay in applying and vague descriptions of the information both weaken an application.
Victims' disclosures protected
Since 1 October 2025 in England and Wales, agreements cannot prevent victims of crime making specified disclosures, such as to police or lawyers.
More limits pending
The Employment Rights Act 2025 will void NDAs preventing workers disclosing harassment or discrimination; as of October 2026 this is not yet in force.
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The short answer: when you need an NDA
A non-disclosure agreement (NDA) is a contract in which one or both parties promise to keep specified information confidential and use it only for an agreed purpose. This NDA UK guide focuses on England and Wales, where NDAs are routinely used before sharing commercially sensitive information: in M&A and investment discussions, joint ventures, supplier and technology pitches, and product development.
You should use an NDA whenever you are about to disclose information that would harm your business if it were used or shared outside the purpose of the discussion, and the other side is not already bound by a confidentiality obligation. An NDA does not create secrecy where none exists. It works best alongside practical controls: disclosing only what is needed, marking documents, and restricting who sees them.
In the employment context, NDAs and confidentiality clauses are lawful but increasingly restricted. Since 1 October 2025, victims of crime in England and Wales cannot be prevented by agreement from making certain disclosures, and further limits on NDAs covering harassment and discrimination have been legislated but are not yet in force.
The legal framework: contract, confidence and trade secrets
Three overlapping sources of protection sit behind every NDA UK businesses sign under the law of England and Wales.
Contract
A typical NDA UK companies use is an ordinary contract. Its terms define what is protected, what the recipient may do with it, and what happens on breach. Like any contract, it needs certainty, an intention to create legal relations and consideration. A one-way NDA, where only the recipient gives promises, may lack consideration unless there is something given in return (such as access to the information) or the document is executed as a deed. Many advisers execute one-way NDAs as deeds for that reason.
Equitable duty of confidence
Even without a contract, English law protects confidential information through the equitable doctrine of breach of confidence. In Coco v AN Clark (Engineers) Ltd, the court identified three elements: the information must have the necessary quality of confidence; it must have been imparted in circumstances importing an obligation of confidence; and there must be unauthorised use to the detriment of the person who communicated it. An NDA removes much of the argument about the second element.
Trade secrets
The Trade Secrets (Enforcement, etc.) Regulations 2018 add a statutory framework for trade secrets: information that is secret, has commercial value because it is secret, and has been subject to reasonable steps to keep it secret. Signing NDAs is one of the clearest examples of reasonable steps. Our guide to protecting trade secrets explains these rules in more depth.
Mutual or one-way NDA?
A one-way (unilateral) NDA protects information flowing in one direction, such as from a company to a potential investor or buyer. A mutual (bilateral) NDA protects both parties, which suits joint ventures, collaborations and technology partnerships where both sides will share information.
| Feature | One-way NDA | Mutual NDA |
|---|---|---|
| Who discloses | One party only | Both parties |
| Typical use | Sale of a business, investor pitches, supplier tenders | Joint ventures, co-development, strategic partnerships |
| Consideration | May need execution as a deed | Mutual promises usually suffice |
| Negotiation dynamic | Discloser pushes for broad protection | Both sides tend to moderate terms because they apply both ways |
| Risk | Recipient may resist onerous terms | A party sharing little may accept obligations it does not need |
Most NDA UK negotiations turn on three points: the definition of confidential information, the duration and any residuals clause. If only one side will genuinely disclose, a one-way NDA is cleaner. Proposing a mutual NDA in that situation can be a negotiating tactic: the recipient may accept stricter terms if they bind both parties equally.
Drafting an NDA UK courts will enforce
Courts enforce NDAs that are clear about what is protected and why. The key provisions are as follows.
Definition of confidential information
The definition is the heart of the agreement. A definition that is too narrow (only information marked "confidential") leaves oral and unmarked disclosures unprotected. One that is too broad (all information of any kind) can be hard to enforce and may be resisted. A good definition covers information disclosed in any form for the stated purpose, including the fact that discussions are taking place, and lists illustrative categories such as financial information, customer data, technical know-how and business plans.
Standard exclusions
Recipients will expect carve-outs for information that is or becomes public (other than through breach), was already known to the recipient, is independently developed, or is received from a third party without restriction. These are reasonable, but the recipient should carry the burden of proving an exclusion applies.
Permitted purpose and permitted recipients
Limit use of the information to a defined purpose, such as evaluating a proposed transaction. Allow disclosure only to employees, advisers and financiers who need to know, and make the recipient responsible for their compliance.
Disclosure required by law
Allow disclosure where required by law, court order or a regulator, but require prompt notice (where lawful) so the discloser can seek protection.
Duration, return and destruction
Set a period for the obligations, which may differ for ordinary confidential information and genuine trade secrets. Require return or destruction of information on request, with sensible exceptions for automatic electronic back-ups and regulatory record-keeping.
Governing law within the UK
Scotland and Northern Ireland have their own legal systems. Scots law protects confidential information through broadly similar principles, but procedure and remedies differ, including interdict rather than injunction. Any NDA UK businesses use across the three jurisdictions should therefore state the governing law and the courts that will hear disputes expressly, rather than leaving it to be inferred.
Remedies and boilerplate
Include an acknowledgement that damages may not be an adequate remedy, supporting an application for an injunction. Add no-licence, no-obligation-to-proceed, governing law and jurisdiction clauses. Where the NDA protects a business sale, consider a non-solicitation clause for employees and customers, bearing in mind that restrictive covenants must be reasonable to be enforceable; see our guide to non-compete clauses.
An NDA is only as good as your evidence. Keep a record of what was disclosed, when and to whom, for example through a data room log. If you later need an injunction, you will have to identify the confidential information with precision, and courts will not restrain the use of vaguely described material.
How to use an NDA well: a step-by-step process
- Identify the information. Decide what you actually need to share and what can wait until later stages, when stronger protections are in place.
- Choose the form. Use a one-way or mutual NDA as appropriate, and check whether your counterparty's template is acceptable or needs amendment.
- Check signatories and execution. Make sure the right legal entity signs, and execute as a deed where consideration may be in doubt.
- Disclose in stages. Share the most sensitive material only when the deal is progressing, and use clean teams for competitively sensitive data.
- Mark and log. Label documents as confidential and keep records of disclosures, including oral briefings confirmed in writing.
- Close out. When discussions end, request return or destruction and a written confirmation of compliance.
Remedies for breach of an NDA
The most valuable remedy is usually an interim injunction, granted quickly to stop further use or disclosure before trial. The court will consider whether there is a serious issue to be tried, whether damages would be an adequate remedy, and where the balance of convenience lies. Speed matters: delay in applying can count against the applicant. Our injunctions team advises on urgent applications.
Other remedies include damages for loss caused by the breach, an account of profits made from misuse of the information, delivery up or destruction of materials, and, in some cases, damages assessed by reference to a reasonable licence fee. Under the 2018 Regulations, specific remedies are available for trade secret misuse. Liquidated damages clauses in NDAs are possible but must protect a legitimate interest and not be extravagant, or they may be struck down as penalties.
Limits on NDAs in employment and settlement agreements
Confidentiality clauses in employment contracts and settlement agreements remain lawful and common. But several rules limit what any NDA UK employers use can achieve.
- Whistleblowing: under section 43J of the Employment Rights Act 1996, any provision in an agreement is void in so far as it purports to preclude a worker from making a protected disclosure.
- Victims of crime: section 17 of the Victims and Prisoners Act 2024, in force in England and Wales from 1 October 2025, makes a provision void in so far as it prevents a victim (or a person who reasonably believes they are a victim) from making specified disclosures, such as to the police, a qualified lawyer, a regulated professional, a victim support service or close family, for defined purposes.
- Harassment and discrimination: the Employment Rights Act 2025 contains provisions that will make NDAs void in so far as they prevent workers from making allegations or disclosures about harassment or discrimination, subject to exceptions to be set out in regulations. As of October 2026, these provisions are not yet in force.
- Regulatory guidance: the Solicitors Regulation Authority has issued a warning notice on the use of NDAs, and solicitors must not draft NDAs that improperly prevent reporting to regulators or law enforcement.
Employers should review template employment contracts and settlement agreements now, so that confidentiality clauses carve out permitted disclosures expressly. A clause that overreaches is void to that extent and can damage trust and reputation. Our employment law team can review your templates.
An illustrative scenario
This scenario is illustrative only; the parties are generic and the facts invented.
A UK software start-up signs a mutual NDA with a larger technology company to explore an integration partnership. The start-up shares its product roadmap and technical architecture. Talks end, and months later the larger company launches a feature that appears to use the start-up's approach.
The start-up's claim will depend on what it can prove. Was the architecture within the NDA's definition? Did any exclusion apply, such as independent development? Can the start-up show what it disclosed and when? A clear data room log, documents marked confidential and contemporaneous notes of meetings would put the start-up in a much stronger position than a recollection of what was said at a whiteboard session. The NDA UK lawyers would rely on is the one supported by that evidence.
Risks and common mistakes
Signing the other side's template without review
Templates from larger counterparties often contain broad residuals clauses, which allow the recipient to use information retained in the unaided memory of its staff. Such a clause can undermine the whole agreement for technical know-how. Other issues include short durations, no restriction on use (only on disclosure), and one-sided remedies. Always read the definition, exclusions, residuals clause, duration and governing law before signing.
Defining confidential information too narrowly
If protection depends on documents being marked "confidential", oral disclosures, site visits and unmarked emails may fall outside the agreement. If you must accept a marking requirement, include a mechanism for confirming oral disclosures in writing within a short period. Better still, define confidential information by reference to the purpose and the nature of the information rather than its labelling.
Relying on an NDA instead of other protections
An NDA protects information, not ideas in the abstract, and it cannot stop independent development. If your value lies in technology, consider patent filings, copyright records and registered designs before disclosure. For brands, register trade marks early. Our intellectual property team can help you decide what to protect before you share it.
Overreaching confidentiality in employment
Clauses purporting to prevent employees from reporting wrongdoing, speaking to the police or seeking legal advice are void to that extent and may attract regulatory and reputational consequences. With further legislation on harassment and discrimination NDAs pending, employers should update templates now and avoid wording that a tribunal, regulator or journalist could characterise as silencing victims.
Cross-border NDAs and Bangladesh
An NDA UK businesses sign with an overseas counterparty should choose the governing law and forum with enforcement in mind. An English court injunction is fast and powerful in England, but enforcing it against a party with no presence in the UK can be difficult. For counterparties in Bangladesh, the Gulf or South Asia, consider arbitration in London, which may be easier to enforce internationally, and check local law on interim relief.
UK businesses outsourcing software development or manufacturing to Bangladesh frequently rely on NDAs to protect designs and code. In that context, combine the NDA with clear IP assignment terms in the main contract, limit access to what each supplier needs, and understand how a judgment would be enforced; see our guide to enforcing a UK judgment in Bangladesh.
What to do next: an NDA checklist
Work through these points before you sign any NDA UK counterparties put in front of you, and before you send your own.
- Decide whether a one-way or mutual NDA fits the information flow.
- Define confidential information by purpose and category, not only by marking.
- Limit use to a defined purpose and disclosure to people who need to know.
- Check exclusions, residuals clauses, duration and return or destruction obligations.
- Execute as a deed if consideration is in doubt, and confirm the right entities sign.
- Keep a record of what you disclose and when.
- For employment NDAs, carve out whistleblowing and permitted disclosures expressly.
Our commercial contracts team drafts, reviews and negotiates NDAs for transactions, partnerships and technology projects. Contact our London office at info@trw.co.
Frequently asked questions
01Are NDAs legally binding in the UK?
Yes. An NDA is a contract and is enforceable in the same way as any other contract if it is sufficiently certain and supported by consideration or executed as a deed. Courts will enforce clear obligations to keep defined information confidential and use it only for a stated purpose. They will not enforce provisions that are void by statute, such as clauses preventing protected disclosures by whistleblowers, or that operate as unreasonable restraints of trade.
02How long should an NDA last?
There is no fixed legal period. Many commercial NDAs run for a fixed period of a few years from disclosure or from the end of discussions, reflecting how long the information stays sensitive. Genuine trade secrets, such as formulae or source code, may justify protection for as long as they remain secret. The right duration depends on the information; an unnecessarily long term can make the counterparty reluctant to sign, while too short a term can leave valuable information exposed.
03What happens if someone breaches an NDA?
The discloser can seek an injunction to stop further use or disclosure, damages for loss caused, or an account of the profits made from misusing the information. Courts can also order delivery up or destruction of materials. Acting quickly is important, particularly if an interim injunction is needed, and the discloser must be able to identify precisely what confidential information was disclosed and how it has been misused.
04Can an employer use an NDA to stop an employee reporting wrongdoing?
No. Any provision preventing a worker from making a protected disclosure under whistleblowing law is void. Since 1 October 2025, agreements in England and Wales also cannot prevent victims of crime from making specified disclosures, for example to the police, lawyers or support services. The Employment Rights Act 2025 will go further for harassment and discrimination once commenced. Employers should make permitted disclosures explicit in their templates.
05Do I need a lawyer to draft an NDA?
Not always. For routine, low-risk discussions, a well-drafted template may be adequate. Legal advice is worthwhile when the information is highly valuable, when you are asked to sign a counterparty's template with unusual terms such as residuals clauses, when the NDA covers an acquisition or investment, when the other party is overseas, or when confidentiality terms are being used in employment or settlement contexts where statutory limits apply.
06Is a mutual NDA better than a one-way NDA?
Neither is better in the abstract. A mutual NDA suits relationships where both sides will share sensitive information, and its symmetry can make negotiations easier. A one-way NDA is cleaner when only one party discloses, and avoids imposing obligations that serve no purpose. A one-way NDA may need to be executed as a deed if there is doubt about consideration, because only one side gives promises.
Sources and official materials
- Trade Secrets (Enforcement, etc.) Regulations 2018 — Statutory definition of trade secrets and remedies for misuse
- Employment Rights Act 1996, section 43J — Contractual duties of confidentiality cannot prevent protected disclosures
- Victims and Prisoners Act 2024, section 17 — Disclosures by victims that cannot be precluded by agreement
- Victims and Prisoners Act 2024 (Commencement No. 6) Regulations 2025 — Brings section 17 into force on 1 October 2025
- Employment Rights Act 2025 — Includes provisions on NDAs covering harassment and discrimination
- SRA warning notice: use of non-disclosure agreements — Regulatory expectations for solicitors drafting NDAs
General information only, current as at 21 October 2026. It is not legal advice and does not create a solicitor–client relationship. It reflects the law of England and Wales unless stated otherwise; Scotland and Northern Ireland have separate legal systems, and the law changes frequently. Check current official sources and take advice on the facts of your matter.