Contract Glossary
Confidentiality Obligation
Definition
A contractual duty requiring a party to keep specific information secret and use it only for authorized purposes. Unlike a standalone NDA, a confidentiality obligation is typically a clause embedded within a larger contract, services agreements, employment contracts, or partnership deals. It defines what's confidential, what you can do with it, and how long the duty lasts.
In Practice
You hire a marketing agency, and the services agreement includes a confidentiality obligation covering your customer data, pricing strategies, and product roadmaps. The agency can use this information only to perform the contracted services, not to pitch your competitors, share at conferences, or use for their own blog content. If an employee at the agency leaks your customer list, the agency is liable under the confidentiality obligation, even though you never signed a separate NDA.
Example Clause
Receiving Party shall hold all Confidential Information in strict confidence, shall not disclose it to any third party without the prior written consent of Disclosing Party, and shall use it solely for the purpose of performing its obligations under this Agreement. This obligation shall survive termination of this Agreement for a period of five (5) years, except with respect to trade secrets, which shall be protected indefinitely.
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