Contract Type:

The Receiving Party agrees not to circumvent or attempt to circumvent the Disclosing Party to gain access to Confidential Information or to make use of any Confidential Information for its own benefit or the benefit of any third party. The Receiving Party agrees not to make any contact with or enter into any business transaction directly with any customer, client, supplier, licensee or business partner of the Disclosing Party that has been identified or introduced to the Receiving Party through disclosure of Confidential Information by the Disclosing Party, without the prior written consent of the Disclosing Party.


This clause specifies that:

1) The receiving party cannot circumvent or bypass the disclosing party to obtain confidential information for its own benefit or the benefit of any other party. This includes exploiting any access or material shared in confidence without consent.  

2) The receiving party cannot use confidential information received from the disclosing party for its own commercial gain or advantage regarding the disclosing party's existing customers, clients, suppliers, licensees or other business partners.

3) Specifically, the receiving party cannot make any direct contact with or enter into commercial transactions with any of the disclosing party's above existing business connections where they have been identified or introduced as a result of confidential information shared by the disclosing party unless prior written consent is obtained.

4) In short, the receiving party is prohibited from using confidential information to essentially "cut out the middleman" by dealing directly and for its own benefit with key commercial contacts of the disclosing party responsible for providing the information. This protects the disclosing party's interests and revenue sources.

Key purposes and rationale for including a non-circumvention clause are:

1) Protection: The clause protects the disclosing party from losing business, customers, suppliers or other commercial relationships by preventing the receiving party from exploiting confidential information to "go direct" or around them. Their key sources of revenue and positions of commercial advantage are shielded.  

2) Trust: By preventing unwanted circumvention, interference or poaching of contacts, the clause fosters an environment of confidence and trust in sharing sensitive commercial data. The disclosing party need not hold back for fear of exposing key interests.

3) Good faith: Imposing an obligation not to circumvent establishes an expectation of good faith conduct and business affinity between the parties in line with the overall purpose of information sharing under their agreement. Comity and continuity of relationship are encouraged over disruption or interference.

4) Deterence: Prohibiting circumvention deters predatory behavior and tactics by the receiving party that might threaten the commercial wellbeing or security of the disclosing party through irresponsible use of trusted information. Consequences can follow for breach, protecting the status quo.

5) Stability: Restricting direct dealings with established contacts fosters stable, predictable commercial relationships uninterrupted by power plays or manipulation. The interests of all parties are balanced through consent and continuity rather than constant disruptive re-alignment to benefit any single player. Partnership emerges where rules prevent excess for mutual gain.

In summary, a non-circumvention clause aims to govern the responsible and equitable use of sensitive commercial information between parties by preventing unwanted exploitation of trust for short-term advantage that undermines the viability of ongoing relationships and revenue sources. At their fairest and most prudent, these clauses recognize that shared prosperity relies on balancing interests and stability over time rather than concentrating benefits through constant disruption. However, they also reflect power and demand compliance where consent proves selective or withheld without cause. Effectiveness requires good faith through judgement and restraint to achieve reasonably protective governance, not superiority alone. Purpose looks to sustainability and shared standards in practice.

History of the clause (for the geeks)

Early commercial dealings relied on general duties of fair dealing and restraint from interfering with established trade. However, as competition intensified and knowledge grew commercially crucial yet mobile, tensions emerged between open exchange and protecting key interests from exploitation without mechanism to define acceptable practice. Expectations stayed uncertain; and irresponsibility retained free rein where relationships lacked specific oversight.

Into the 19th century, non-circumvention concepts arose as prudent standards of conduct that recognized enduring prosperity required balancing opportunity and continuity. While contracts remained limited, norms emerged against using shared knowledge or position to unfairly disrupt the trade of those responsible for enabling your advance. Judgement was demanded to curb excess and align interests for mutual gain over time, not concentration of benefit through constant re-alignment to advantage any single party unconditionally. Equity and reciprocity were viewed as economically sound, not contrary to enterprise.

By the early 20th century, non-circumvention clauses appeared in commercial contracts to provide specific parameters around the fair use of information and treatment of established connections. However, legitimacy and effect still relied on environment - oversight, shared standards of reasonable practice, and continuity of relationships mattered as much as imposed terms. Mere mechanism did not instill purpose; and irresponsibility waived provision where interests stayed improperly balanced or trust was systematically exploited. At their most prudent, these clauses recognized shared gain through stability, not asserting entitlement without consequence.

Mid-century, as global trade expanded but personal bonds waned, robust non-circumvention regimes emerged to safeguard commercial interests and foster lasting partnerships. But at their fairest and most effective, these clauses also recognized control was not absolute - restraint and consent were virtues where resources or relationships were at stake. While enabling parties to prevent unwanted interference, undue manipulation for profit alone was also discouraged. Judgement was required to balance security and flow for shared gain, not concentrate power or impose direction without care for effect. Continuity relied on comity as much as compliance here. Prosperity was found through open exchange, not hoarding beyond need.

Today, non-circumvention frameworks aim to facilitate responsible commerce through reasonable protection from predatory practice. But prudent clauses recognize that no mechanism itself instills understanding or governs irresponsibility - oversight and incentive matter in users. At their best, these clauses represent a shared quest for continuity through consent and restraint, not entitlement without consequence. While controlling exposure, they curb excess and demand consideration of interests beyond one's own. Effect relies on environment - shared norms, stability through balance of power, and reciprocity inform self-interest. Where these clauses prevail, relationships emerge through willingness to forbear as much as enjoy advantages gained; and prosperity follows where parties work to steward shared benefits rather than disrupt without cause. Judgement proves the more productive path where rules or compliance alone fail to instill purpose. In the end, mutual reliance and restraint sustain where fixation on control and division does not.

In summary, non-circumvention clauses reflect recognition that commerce depends on fair and prudent governance over the use of information, power and opportunity more fundamentally than mechanisms that concentrate benefit or assert claims of entitlement alone. At their most equitable and effective, these clauses represent understanding that prosperity relies on reciprocity, stability and a balancing of interests over time - not disruption without restraint. However, they also allocate risks and consequences where trust is systematically exploited.

Ultimately, purpose and practice emerge through agents and an environment shaped not just by imposition of terms but incentives, relationships and standards that foster continuity of affiliation beyond narrow self-interest. Wisdom informs advantage through shared duty to forbear when required, not wield power without accountability or care for effect on surroundings. Where relationships prevail, effectiveness reaches inward through oversight that aligns interests, not downward by decree alone. Judgement proves the more productive path where these clauses achieve reasonable practice through shared commitment to steward resources and capital for common good as much as private motive. Mutuality sustains where entitlement does not, and rules curb rather than command excess. Partnership emerges where compliance meets good faith.