Trade Secret Protection Agreement

Trade Secret Protection Agreement: what it is

A trade secret protection agreement sets out how a specific trade secret, such as a formula, process, source code, recipe or customer data, will be shared with and guarded by the person receiving it. It is more structured than a general NDA because it records specific access controls and handling rules. Confidentiality continues after the term for as long as the information remains secret.

When you need this document

• A manufacturer is sharing a proprietary formula or process with a contract manufacturer or job worker.
• A company is giving a technology partner access to source code or algorithms that are not patented.
• A food or beverage business is sharing a recipe with a franchisee or co-packer.
• A senior employee, consultant or auditor needs access to pricing models, supplier terms or customer lists.

What it covers

• The effective date and the names of the owner and the recipient.
• A description of the trade secret being protected.
• The access controls and handling protocols agreed by the parties.
• A prohibition on disclosing, reproducing or using the trade secret beyond what the owner expressly authorises.
• A term in years, with confidentiality obligations that survive for as long as the information remains a trade secret.
• A remedies clause recording that breach may cause irreparable harm and allowing the owner to seek an injunction in addition to damages.

How to fill, sign and use it

1. 1Identify the trade secret by category and reference, such as a document code or batch process name, without writing the secret itself into the agreement.
2. 2Write practical access protocols: who may see it, where it is kept, password and device rules, copying limits, logging, and return or destruction at the end.
3. 3Fill in the form on this page and check the preview, especially the protocols and the term.
4. 4Have an advocate review the agreement before signing, because courts look closely at how clearly the secret is identified and how reasonably it is protected, and any non-compete wording can be void under Indian contract law.
5. 5Pay stamp duty as applicable in your state and have both parties sign, preferably before witnesses.
6. 6Apply the protocols in practice: keep access logs, mark documents as confidential, and collect written confirmation of return or deletion when access ends.

Documents to attach or keep with it

• Schedule of the confidential documents, files or samples handed over.
• Internal security policy or handling instructions the recipient must follow.
• List of the recipient's personnel authorised to access the trade secret.
• Acknowledgement forms signed by those individuals.

The law behind it

India has no separate trade secret statute. Trade secrets are protected through contracts under the Indian Contract Act, 1872 and through the law of confidence developed by courts, with injunctions available under the Specific Relief Act, 1963. Confidentiality promises are generally enforceable, but an agreement that stops someone from carrying on a lawful trade or profession after the relationship ends is usually void under section 27 of the Contract Act. Where personal data is involved, the Digital Personal Data Protection Act, 2023 may also apply.

Common mistakes to avoid

• Describing the secret so broadly, such as all business information, that a court cannot tell what was actually protected.
• Agreeing access protocols on paper but not following them, which weakens the claim that the information was kept secret.
• Adding a post-term non-compete restriction that is unenforceable and can cast doubt on the rest of the agreement.
• Waiting too long to act after discovering a leak, which can make urgent injunction relief harder to obtain.

Trade Secret Protection Agreement: frequently asked questions