IACCM Contract Management Forum

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2019-04-24 17:16:27

Requests to sign NDA as is

In this day and age when NDAs are required before the bidding process starts, is it common to come across companies who demand/request that an NDA be signed as is and that no changes to the NDA are allowed? Is it common in these cases to make a business decision to do so--to accept the risks? Trying to gauge how common this occurrence is and what others typically do.
 •  Airbus Defence and Space GmbH  •   2019-04-25 16:48:19
I guess typically companies sign as the risks are possibly manageable ! If that approach is relational or a trust building measure is a very different question ! And I am tempted to say clearly not as imposing terms is quite the opposite to building up a trust based realationship!
 •  SC Johnson  •   2019-04-30 13:59:11
In my experience, requests or demands to have suppliers sign NDAs as-is have become the standard. Especially in the case of an RFX pre-requisite, the buyer is in a superior position of leverage, and attempts to negotiate the terms of the NDA may be viewed as an indicator that the supplier will be difficult to negotiate with when the time comes to establish the commercial agreement.

Additionally, most legal departments view NDAs as a strong candidate for click-through or self-help contracting with a strong desire to standardize and remove themselves from what should be a non-complex, straight-forward document. If the NDA provided is not standard for your business, but is reasonable on its terms - review it with your team to ensure everyone knows how to *manage the information and move on to participate in the RFX.

*Standards for management of confidential information used to be fairly straight-forward, with terms indicating that the recipient must protect the discloser's information with the same level of care as it uses to protect its own (but in no event less than a commercially reasonable degree of care). With increasing concerns over cyber-security and data privacy breaches, it's more common to see NDAs carry designated or mandatory safeguards that prescribe processes, controls and other duties that your organization may or may not be capable of providing. Make sure your IT team (or other SME) can confirm you meet the requirements prior to signing.
 •  -  •   2019-05-22 07:28:25
This is not uncommon but there is always a but. For example, is the NDA 2-way or does it only protect one party's CI. Companies are often willing to make an exception to their "no change requirement" if there is compelling and easily articulated (and understood!) argument why a change to an NDA, or an additional NDA, is required.

Hope this helps!
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