NDAs & Confidentiality Agreements for Nepali Startups (A Practical Guide)

An NDA in Nepal is a contract, and that is the whole point. Nepal has no standalone trade-secret statute, so whatever your confidential information is worth, the written agreement is doing most of the work on its own.

Key takeaways

• We could find no standalone trade-secret law in Nepal, so confidentiality rests on contract.
• The Competition Promotion and Market Protection Act 2063 binds the Board and its officer, not your competitor.
• Labour Act 2017, Sec. 131(4)(g) and (h) make leaking a production formula dismissible misconduct — for your own staff only.
• TRIPS Article 39 is an obligation on the state, not a claim form a Kathmandu business can file.
• Sign before disclosure. Nothing makes information secret again once it is out.
• An NDA protects secrecy, never ownership. A brand, an invention or a product shape needs registration.
• IP Sewa does not draft NDAs. Use a practising advocate for the contract, and us for the registrable part.

What is an NDA, in one line?

A promise, in writing, that the person receiving your information will keep it to themselves and use it only for the reason you shared it.

Everything else in the document exists to make that promise provable: who is bound, what exactly is covered, for how long, and what happens if it is broken.

Why does Nepal lean on the NDA so heavily?

Because the alternatives are thin. A brand, an invention and a product shape each have a register at the Department of Industry; a customer list, a price model or a recipe has nothing of the kind.

So the contract is not a formality bolted onto a stronger right. For most of what a startup actually guards, it is the right.

That is a reason to draft it carefully rather than to download it. A vague agreement in a system with no fallback statute leaves you with very little.

Is there a trade-secret law in Nepal?

We could not find one. The Patent, Design and Trade Mark Act 1965 covers patents, designs and trade marks, and creates no right in undisclosed information.

Several international summaries reach the same conclusion. Treat this as our reading as of our last check, and confirm the current position with a Nepali advocate before acting on it.

The absence matters in a specific way. Without a statute there is no statutory definition of a trade secret, so your own definition clause is doing that job too.

What does the Competition Act actually protect?

Not your formula. We read the Competition Promotion and Market Protection Act 2063, and its confidentiality provisions bind the Board and its market-protection officer to keep information they receive secret, and shield a complainant's identity.

Those are duties on a regulator handling your file. They create no obligation at all on a rival who learns your method from a departing employee.

Does the Labour Act help?

Yes, and it is the one genuine statutory hook most articles miss. Sec. 131(4) of the Labour Act 2017 lists misconduct for which an employee may be dismissed.

Clause (g) covers divulging the secrecy of a production technology related formula, or confidential information of the enterprise, with intent to cause loss.

Clause (h) covers working for a competing employer, running a competing business, or handing the enterprise's secret information to a rival.

Why is that hook narrower than it sounds?

Because it is a disciplinary power over your own staff. It says what you may do about an employee, not that you own the information.

It reaches no supplier, no co-packer, no consultant and no former partner, because none of them is your employee. Those relationships need a contract or nothing.

Clause (g) also turns on intent to cause loss, which is harder to establish than plain carelessness with a shared drive.

What does TRIPS require of Nepal?

Nepal joined the World Trade Organization in 2004, and Article 39 of TRIPS requires members to make protection of undisclosed information possible.

That is an obligation about the shape of a country's law, not a remedy a business can invoke directly. WIPO publishes general material on how trade secrets work internationally.

Our explainer on what the TRIPS Agreement means for Nepal sets out which obligations have actually landed in domestic law.

So what law governs the NDA itself?

General contract law. Nepali contract rules now sit in the Muluki Civil Code 2074 (2017), and an NDA is enforced as an ordinary agreement rather than as an intellectual property right.

That means the usual questions decide it: were the parties competent, was there real agreement, are the terms lawful and clear enough to apply. The Nepal Law Commission publishes the statutes.

It also means an unreasonable restriction can be argued about. An advocate should check anything that looks like a lifetime ban on a person working in their own field.

One-way or mutual: which do you need?

Match the document to the direction information actually flows. If only you are sharing, a one-way agreement puts the duty where the risk is.

The last row catches people out. Confidentiality and ownership are different promises, and an NDA alone does not assign the copyright in code your contractor wrote.

What clauses must be in it?

Fewer than most templates contain, but each one doing real work. The definition clause and the purpose clause carry most of the weight.

Write the definition so that a stranger reading it could sort a pile of documents into covered and not covered. "All information" fails that test.

When exactly should you sign it?

Before the first sentence that matters. The most common failure we hear about is not a bad clause; it is a good agreement signed after the deck was emailed.

Build it into the calendar invitation rather than the follow-up. If the meeting is happening because you are going to explain something, the document belongs before the meeting.

And remember the other clock. Nepal is first-to-file, so if the thing you are about to describe could be a registrable mark, an invention or a design, file before you show it around.

How do you put one in place, step by step?

1. List what actually needs protecting. Usually three or four things, not everything you own.
2. Decide the direction. One-way, mutual, or employment terms, depending on who discloses.
3. Write the purpose in one sentence. The single reason this person may use the information.
4. Check the exclusions and the term. Public and independently developed information should fall outside it.
5. Sign before anything is sent. Attach it to the calendar invitation, not the follow-up email.
6. Record the disclosure. Date, recipient, and exactly which files went across.
7. File what is registrable. A name, invention or design belongs on a register, not in a contract.

What can an NDA never do?

It cannot reach someone who never signed. It cannot reverse a disclosure. It cannot stop a competitor who arrived at the same idea independently or who took the product apart.

It also cannot create ownership. A contractor who signs an NDA and writes your software has promised silence, not given you the copyright.

Our guides to the copyright assignment agreement and the patent assignment agreement cover the documents that actually move ownership.

What should you register instead?

Whatever has a register. A name or logo is a trade mark; a technical solution may be a patent; the look of a product is an industrial design.

Trade mark filings are made category by category, using the NICE classification, so check the categories early with our class finder and screen the name on our register search.

A registered mark runs seven years, and the renewal term is another seven, repeatable. Once a mark is published in the bulletin, the trade mark opposition window is treated in practice as 90 days.

If the name is the asset, start with our registration service and let the agreement cover only what no register will take.

Choosing the name is its own discipline, and our note on how startups pick a name that will not get sued covers the screening most founders skip.

How do you prove a breach?

With records you made before anything went wrong. The signed agreement is one document; what it protects has to be shown separately.

Keep a dated list of what you disclosed, to whom, and on what date, along with access logs and the files themselves.

Behaviour matters as much as paper. An agreement about "confidential information" that sat on an open shared drive argues against you in any forum.

Common mistakes

• Signing after the meeting. The information is already out, and the document cannot pull it back.
• Defining everything as confidential. A definition that covers all information proves nothing about any of it.
• Leaving out the purpose clause. Without it, the recipient can argue almost any use was allowed.
• Using an NDA to secure a brand. Secrecy is not ownership, and a name needs the register.
• Relying on it against a supplier's supplier. A contract binds the person who signed it and nobody further down the chain.
• Copying a foreign template whole. Governing law, forum and remedies clauses all need to make sense in Nepal.

A worked example

This is an illustration, not a real case. A Kathmandu food startup wants a co-packer to bottle a sauce, a designer to finish the label, and a developer to build the ordering app.

Each conversation needs a different document. The co-packer gets a one-way agreement covering the recipe and process; the designer and developer get terms that also assign what they create.

Meanwhile the brand name goes on the register, because no agreement stops a stranger who has never met them from filing it first.

Six months later a batch appears under a similar name. What helps is not the NDA — it is the registration, and our enforcement team acts on that.

Does IP Sewa draft NDAs?

No. We are an industrial property practice, so we handle trade marks, patents and designs, and we do not draft or review confidentiality agreements.

Use a practising advocate for the contract. Our companion note on how to use an NDA template explains what to ask them for.

Where the same conversation involves a name, an invention or a product shape, that half is ours, and you can ask us about it directly.

In short

Nepal gives you a contract, a narrow employment-law hook and your own evidence. That is the honest list, and it is shorter than most articles suggest.

So sign before you speak, define the information precisely, and register everything a register will take.

For the registrable half, our search and clearance service is the sensible first step before a name leaves the room.

People also search for

• NDA template for Nepali businesses
• Protecting a tech startup's brand and IP
• Naming a startup so the brand is registrable
• IP compliance for Nepali businesses
• When two Nepali brands clash

If the conversation you are about to have involves a brand, an invention or a product design as well as a secret, tell us what you are about to show and to whom.