Each party shall keep confidential all Confidential Information of the other party, and shall only disclose such Confidential Information to: (a) its employees, officers, representatives, advisers, agents or subcontractors who need to know such information for the purposes of exercising the party's rights or carrying out its obligations under or in connection with this Agreement; and (b) as may be required by law, a court of competent jurisdiction or any governmental or regulatory authority. Each party shall ensure that its employees, officers, representatives, advisers, agents or subcontractors to whom it discloses the other party's Confidential Information comply with this Clause [x]. No other disclosure of Confidential Information is permitted.
Here is a plain English explanation of the Permitted Disclosees - Disclosure Requirements clause:
- This clause sets rules around disclosing confidential information from the contract.
- Each party must keep the other's confidential information secret.
- They may share it internally with employees, agents, etc. who need it to perform duties under the contract.
- They may also disclose it when legally required by law, court orders or government authorities.
- If confidential information is shared internally, they must ensure those people also follow the confidentiality rules.
- No other disclosure of confidential information is allowed under the contract.
- The purpose is to limit disclosure to specific permitted situations for contract performance or legal necessity.
- It protects confidentiality while allowing necessary information sharing between the parties and their representatives.
- The restrictions aim to prevent improper disclosure and misuse of sensitive information.
The concept of limiting disclosure of confidential information has existed for centuries, but explicit contractual controls developed more recently.
In the 19th century, common law established implied duties of confidentiality between certain parties like doctors and patients. However, written non-disclosure agreements remained rare outside specialized fields like inventions.
The rise of large corporations in the early 20th century led to more formal confidentiality practices. As companies grew and collaborated across regions, they needed to share more proprietary information with a wider network of insiders. This drove efforts to codify permitted disclosure through contracts. By the 1950s, non-disclosure clauses were common in business agreements.
The information technology revolution of the late 20th century dramatically increased confidential data sharing while also enabling new threats like hacking. In response, companies strengthened contractual controls over internal usage and external disclosure of sensitive information. Legal terms evolved to cover digital assets and online activities.
Today, delineating permitted disclosees is seen as a crucial element in protecting intellectual property and maintaining competitive advantage. The proliferation of data and connected systems has led to ever more detailed confidentiality clauses to manage complex information flows across global supply chains and partnerships.
Looking ahead, contracting parties will likely need to continue adjusting permitted disclosee definitions and requirements to account for emerging technologies, data uses, and risks.
As information grows more interconnected and valuable, robust contractual controls over its disclosure become increasingly mission-critical.