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Non-Disclosure Agreement (NDA)

Also known as: NDA

A non-disclosure agreement (NDA) is a contract in which parties agree to keep specified confidential information private and not disclose it to others.

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NDAs are common early in a sourcing relationship, when a buyer and potential supplier need to share sensitive details — specifications, pricing, volumes or plans — before committing to a full contract. The agreement defines what counts as confidential, how it may be used, how long the duty lasts, and the remedies if information is leaked.

An NDA can be one-way, protecting a single party's information, or mutual, where both sides disclose. Buyers use them to protect commercial and technical data during negotiations, tenders and due diligence. A clear, proportionate NDA builds enough trust to exchange information openly without exposing either party to unnecessary risk.

Frequently asked questions

What is a non-disclosure agreement?
A non-disclosure agreement (NDA) is a contract in which parties agree to keep specified confidential information private and not disclose it to third parties.
When is an NDA used in procurement?
Typically early in sourcing — during negotiations, tenders or due diligence — when a buyer and supplier need to share sensitive specifications, pricing or plans before a full contract exists.

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