Does your business need a non-circumvention agreement?
If you deal with outsiders, contractors, or other businesses on a regular basis for new business opportunities, you certainly do. Also, if you are planning to expand your business and deal with different parties, you should have a non-circumvention agreement in place to protect your business relationships.
What is the purpose of non-circumvention agreement?
This important document will protect you if the disclosing party shares valuable information regarding a business opportunity of any kind with a receiving party. They should not be able to take advantage of the information to circumvent your business and directly talk to your contacts, bypassing you and your business.
A non-circumvention agreement also protects your business against loss of valuable and proprietary information and data. If you have a business partner or a contractor, you do not want any information that they are privy to be shared with others in a similar field. This can lead to devastating losses for your business.
What does a non-circumvention agreement cover?
It can cover any kind of eventuality that can potentially lead to business losses for you. With this agreement, many aspects of your business can be protected such as:
- Business opportunities
- Business contacts
- Trade secrets
- Business plans
- Customer lists
A non-circumvention agreement provides each party will only use the information it obtains to evaluate further pursuing or entering into a business relationship or transaction. That means if there is no further interest, neither party can use any of the other’s information to benefit itself or go to the other party to do the deal.
Clauses can be added specifically to your business for additional protection. Non-disclosure and confidentiality agreement clauses are often included so your business secrets cannot be revealed without your consent.
What can happen if you don’t have a non-circumvention agreement in place?
Without this legal document, the party that has the information can use it to poach your clients and business opportunities, go to your suppliers, and cause severe harm to your business. A non-disclosure and confidentiality clause serves to protect your business interests, your brand, and prevent financial losses due to loss of proprietary information.
While you can find many non-circumvention agreements on the internet, if you have any concerns regarding any specific aspects of your company, it is best to clarify with a law firm for specific details so that you can acquire the kind of agreement that will protect you and your business.