Why do we need NDA, NCA, NSA agreements in the field of IT

Contents: 

• NDA (Non-Disclosure Agreement) in IT;
• NCA (Non-Competition Agreement) in IT;
• NSA (Non-Solicitation Agreement) in IT. 

NDA

NDA - Non-Disclosure Agreement. The IT sphere, like any other, is associated with information, often confidential and playing a key role in the work. Basically, NDAs are concluded with contractors, employees or business partners. For example, when you conclude a contract with a developer to perform a task, the source code or part of your software is transferred. In the absence of an NDA, the developer can use the information received for fraudulent purposes and distribute your source code, which will have fatal consequences.

The NDA can act as part of a contract, such as a work contract, or it can be a separate document. In case А45-47738 / 2018, an agency agreement for attracting clients was concluded between a limited liability company and an individual entrepreneur, containing the terms of the NDA. The individual entrepreneur violated these conditions, in connection with which the limited liability company went to court. The court partially satisfied the claim, having understated only the amount of the fine collected from the individual entrepreneur.

The non-disclosure agreement must contain the following clauses:

• List of confidential information - program source code, databases, customer information, and so on;
• Ways of illegal disclosure of information;
• Permitted methods of transferring confidential information;
• The term of the NDA agreement;
• Measures aimed at protecting information - using a certain method of storing and transferring information;
• Responsibility for the disclosure of information.

In the current judicial practice in Russia, the courts determine a number of essential conditions of the NDA, these are: 

• determination of the most confidential information;
• determination of the rights and obligations of the parties to protect the commercial secret regime;
• determination of the term for non-disclosure of confidential information.

NCA 

NCA - Non-Compete Agreement. This agreement is concluded between the employer and the employee, under which the employee undertakes not to enter into any employment or civil contracts with the employer's competitors within a certain period after the termination of employment or other relations with the employer. In case А70-13409 / 2014, considered by the Arbitration Court of the Russian Federation, the former director of the company organized his own, where he carried out similar activities of the original company, and was also engaged in poaching clients. Despite the absence of the concluded NCA or the presence of such clauses in the contract, the court motivated its decision to satisfy the claim of the founders of the company, whose clients were lured away, by the position of the plenum of the Supreme Arbitration Court of the Russian Federation and generally accepted standards of conduct.  

The NCA also points out that the employee undertakes not to engage in similar activities, and the employer has the right to pay the employee a remuneration for refraining from competition. This agreement protects the employer from the unfair behavior of competitors, who in turn decide to take advantage of the knowledge and secrets of the former employee. The NCA, by analogy with the NDA, can act as a separate act or be part of an employment contract. An important point of the NCA is the sanction for violation of the terms of the contract. The Anapa City Court in case 2-1296 / 2017 made a decision, where the court established the fact of violation of the labor contract in terms of the conditions of non-competition, but the contract did not establish sanctions for the violation, therefore the court could not satisfy the claim in terms of material compensation for damage.

NSA

NSA - Non-Solicitation Agreement. It is similar in nature to the NCA, but it consists of specialists in high positions in the company, top managers who are in contact with clients.

 The NSA must contain a number of mandatory clauses:

• Categories of employees and clients eligible for the NSA;
• The list of actions qualified as poaching - the conclusion of work contracts, labor contracts, offers to clients to change partners, and so on;
• Term;
• Responsibility for violation of the contract;
• Territory of the agreement.

Thus, all of the above agreements are most effective when applied in combination, but you should always take into account the specifics of your business and the jurisdiction in which it is located. Despite the seeming simplicity of these agreements, in practice there are many pitfalls. To avoid all risks and keep your business safe, you can use the services of the professional team of A4 Law Firm lawyers by contacting us at +74998410505.

NDA, NCA and NSA contracts are the most effective tools in working with counterparties to preserve trade secrets. Despite the general similarity of non-competition and non-disclosure agreements, there are many subtleties in their drafting.