Non-disclosure agreement (NDA)
What is a non-disclosure agreement (NDA)?
A non-disclosure agreement (NDA) is a contract in which the parties promise to keep the information they exchange secret and to use it only for the agreed purpose. It is signed before the first detailed conversation about a project, an audit or an integration. It sets out what counts as confidential, how long the duty lasts, what is excluded and what happens if it is broken.
Example
A manufacturer of industrial parts wants to connect its warehouse software to an online shop. To size the work we need to see how the stock database is built, which customers sit on which price tier, and a sample of real orders. Before that meeting both sides sign: we keep the data and the credentials we are given confidential, and the manufacturer keeps our technical proposal and our estimate confidential.
The text settles concrete points. Confidential means anything marked as such or plainly not public. Use is limited to assessing and delivering this project. The duty runs for five years after the contract ends. Subcontractors get access only with written consent and on the same terms. On completion, copies are returned or deleted. Excluded are facts that are already public, that the receiving side knew beforehand or obtained lawfully from a third party; disclosure required by law is handled separately. The penalty is a fixed amount per breach, because the loss caused by a leaked customer price list is hard to prove in figures.
Why it matters for a business
Bulgarian trade secret law, which follows the EU directive, protects information that is secret, has commercial value because it is secret, and that its holder has taken steps to keep secret. A signed agreement, together with control over who holds access, is one of those steps; without them the protection is hard to demonstrate. An NDA does not replace two separate documents: the data processing agreement required by Article 28 of the GDPR when a supplier processes personal data on your behalf, and the clause that says who owns the source code. Under Bulgarian copyright law the author of commissioned work keeps the rights unless the contract says otherwise; the client may use the work for the purpose it was ordered for, which is not the same as owning it. So the transfer belongs in the development contract, not in the confidentiality agreement. A promise not to hire each other’s staff is a separate clause as well.
What to ask
- Is the agreement mutual, or does only one side take on the duty?
- Is confidential information described by a broad phrase, or by a list that covers credentials, data and prices?
- How long does the duty last after the work ends, and which material stays confidential indefinitely?
- What happens to copies, backups and access on termination?
- Is there a penalty, is the amount proportionate, and which court decides a dispute?
- Are the supplier’s own subcontractors and cloud services covered by it?
We sign one before we get access to your systems, when we scope a piece of web software.