Regulatory Disclosure - OneNDA Provision

OneNDA Owner’s Manual™ A Jolly Contrarian owner’s manual™ Go premium Overview — Summary — Premium — See also — Wikitext Crosscheck: NDA Showdown OneNDA Homemade NDA What is Confidential Information? Confidential information Exclusions from confidential information Who can I share it with? Affiliates Permitted receivers Disclosure to regulators What are my obligations? Confidentiality obligation Procure compliance Return of information How long do my obligations last? Term Other important information Boilerplate Remedies Don’t go there girlfriend topics Non-solicitation Exclusivity Indemnity 2(c) in a Nutshell™ The JC’s Nutshell™ summary of this term has moved uptown to the subscription-only ninja tier. For the cost of ½ a weekly 🍺 you can get it here. Sign up at Substack. You can even ask questions! Ask about it here. Original text The Receiver may share the Confidential Information if required by law or regulation but must promptly notify the Discloser of the requirement if allowed by law or regulation. Resources and Navigation Index: Click ᐅ to expand: OneNDA TOC OneNDA NDA

Comparisons

A common enough provision in an NDA — for the general, non-OneNDA experience see disclosure to regulators.

Basics

There are times in the life of a regulated institution when it must open its kimono to those with the power to police it. These might be prudential regulators, competition and antitrust authorities, parts of the market infrastructure, courts, and, well, the police.

It really should go without saying that one may disclose information one is, in any case, legally obliged to disclose; there are grey areas of course: what if the information is requested but not demanded, or where there is no available power of compulsion? What happens to the information once the regulator has it? Is it still confidential?

The JC starts with the pragmatic observation that, in advanced democracies, competent regulators generally mean well, are there for our collective good, and so giving them information shouldn’t usually do great violence to the commercial principles of confidentiality (namely, protecting the commercial value of the information disclosed).

“Pragmatic” because, whether or not this is true, there is not much we can do about it. If you are not in an advanced democracy, you will generally have bigger things to worry about than whether your regulator can keep its trap shut,

So the starting point is to define “regulators” widely, not stand on ceremony, be able to provide information to themon request, without fuss and without troubling the discloser, much less assisting it in its efforts to stymie what we must presume is a bona fide motivation for disclosure. Yes, the information absolutely should remain confidential as far as it is in the recipient’s hands, or those of its voluntary disclosees. And in all likelihood it will stay that way in the regulator’s hands too.

Now there are nefarious regulators, to be sure, and there are certainly careless or stupid ones, and if they lose, leak or wantonly broadcast proprietary information it would be a shame, but should not really be the recipient’s problem. Regulatory disclosure is an externality. No-one asks for information in the hope of giving it away.

Note that incidences of regulatory indiscretion are rare — JC has never heard of one — and resulting diminution in commercial value rarer still. Most “confidential information” really isn’t half as special as its discloser would have you believe.

The NDA process is, largely, a pantomime, that is to say.

Premium content Here the free bit runs out. Subscribers click 👉 here. New readers sign up 👉 here and, for ½ a weekly 🍺 go full ninja about all these juicy topics👇 JC’s “nutshell” summary of the clause Background reading and long-form essays Obligation to notify provider of regulator requests A cut-out-and-keep response if anyone asks you to commit to opposing regulatory disclosure Information disclosed to a regulator is still confidential information