Confidentiality agreements

The number of confidentiality agreements signed is a good guideline of the status of research and innovation in a territory, pharm at least that is how I understand it.

The reason that has led me to write this article is because, mind over the last month, find six clients have asked me to draw up a confidentiality agreement for them and maybe for the whole of 2012 I drafted seven of these types of agreements. Furthermore, I have the feeling that in 2013 I will be asked to draw up a lot more.

The clients that have asked me for these very specific agreements have two different profiles: (i) on the one hand, there is the profile of new entrepreneurs/business owners that are launching a project and want to protect it, being aware of its potential value and (ii) on the other hand, there are traditional companies operating for many years that are conducting research and innovation work and beginning to realise the value of legally protecting this work.

For example, a leading company that markets a food product asked me for a confidentiality agreement with its external manufacturer that produces it, because the company provides it with secret recipes, formulae, volumes, etc. This is hardly surprising, but what could come as a shock is that it had not done this until now, after operating for many years in the market.

Another client that manufactures a high-technology product and has been exporting it all over the world for many years asked me for a confidentiality agreement this week to be signed with all its suppliers, because it gives formulas to some of them, designs or plans to others, etc. The same thing happened again with a leading furniture manufacturer that creates very exclusive designs and outsources the production because it does not want its suppliers to steal them. This happened again with a subsidiary of a foreign company that had commissioned a Catalan company to adapt the products it distributes.

I have even come across an anecdote that I found quite amusing. One of these young entrepreneurs came to see me at the office and first of all he asked me to draw up a confidentiality document to cover what he wanted to tell me and, once I had signed it and given it to him, he would explain his project to me. I thought this was very good, because even though I explained to him that lawyers already have an ethical obligation of confidentiality, he was still not convinced.

All these clients, for one reason or another, have now realised the importance of confidentiality, at the beginning of 2013, and I think this is important because it means our economy is really changing and it is no longer just an illusion. Our companies are becoming more innovative and they realise they must provide added value because if they do not they will not be viable and therefore they are concerned now, more than ever, about protecting their know-how, technology, inventions, research results and all of these intangible assets that are so valuable.

Moreover, there is a new generation, which was created years ago and that I suspect is now, at the end of 2012 and the beginning of 2013, starting to emerge and it does not only have ideas but is also developing them and seeking funding from anywhere it can, apart from banks, and is very aware that the first thing it must do is to protect its ideas and projects so that nobody steals them, as has happened in other cases they have heard about.

This new generation is fully skilled and emerging throughout the whole of Catalonia and is now seeking advice and assistance. It knows very well what it wants and is highly skilled. Not too many people have probably realised this yet, but, thanks to my profession, I have the privilege of detecting these outbreaks before others, because I know how to draw up and draft confidentiality agreements. The first thing this new race of business owners ask for is this: to be able to explain their idea to third parties with legal guarantees.

The two client profiles that have asked me for confidentiality agreements over the last month I believe to be very important for our economy and the future depends on these two profiles, in other words traditional companies that are firmly committed to innovation and new companies created by new entrepreneurs and business owners that are very well-aware of the fact that the path ahead requires new technologies, inventions, research results and the intangible aspect that still occupies a minority position in our business fabric.

Therefore, I propose that you consider whether your company requires a confidentiality agreement and, if the answer is no, I recommend that you should make an effort so that, in the shortest time possible, you will need to ask for this kind of agreement, because this will be an unmistakable sign that something has changed in a positive way in your company.

Jordi Bellvehí