An NDA (non-disclosure agreement) in Nepal is a private contract that binds the receiving party to keep your confidential information secret — it is not filed with or issued by the Department of Industry, and unlike a trademark registration it creates no public record. Draft it clearly, sign it before you disclose anything, and the contract is enforceable through the Nepali courts under general contract law.
Key Takeaways
- An NDA is a contract, not an IP right — it works alongside trademark, patent, and design protection under the Patent, Design and Trade Mark Act 1965.
- There is no government form or DoI template for NDAs; you draft them privately, often with a lawyer's help.
- Use an NDA before you reveal anything — with employees, manufacturing partners, investors, or potential buyers.
- A signed NDA lets you sue for breach of contract and claim damages in a Nepali court, but the information itself must genuinely be confidential.
- NDAs do not replace trademark registration — a brand name disclosed under an NDA still needs a DoI filing to become a registered mark.
- The strongest NDAs define exactly what is confidential, how long the obligation lasts, and what the receiving party can and cannot do with the information.
What exactly is an NDA under Nepali law?
A non-disclosure agreement is a private contract — not a government registration — that legally obliges one or both parties to keep specific information confidential. Nepal has no standalone NDA statute. Instead, NDAs are governed by the National Civil (Code) Act, 2074 (the Muluki Dewani Samhita) and general contract principles. A well-drafted NDA creates a binding obligation: if the receiving party leaks or misuses your trade secrets, you can sue for breach of contract and claim damages. Unlike a trade mark registered with the Department of Industry, an NDA does not appear in the Industrial Property Bulletin or any public register — it stays between the parties.
Why use an NDA instead of relying on IP law alone?
Nepal's Patent, Design and Trade Mark Act 1965 protects registered rights — but many valuable business assets never get registered. Your customer list, your pricing formula, an unreleased recipe, a manufacturing process, or the source code of software you are building all fall outside what the DoI registers. An NDA plugs that gap by making confidentiality a contractual duty. It also covers you during the window before you file: you can discuss a new brand name or product with a potential partner under an NDA, then file the trademark application separately. The NDA does not replace registration — it complements it.
Who typically uses NDAs in Nepal?
Startups use NDAs with their first employees and co-founders. Restaurants and food brands use them with ingredient suppliers and contract kitchens. Software houses use them with freelance developers and clients. Manufacturers use them when a foreign buyer shares product specifications for a private-label order. Exporters of handicrafts, pashmina, or tea frequently sign NDAs with international distributors who want to see designs and pricing before committing. In every case, the NDA is signed before the sensitive information is handed over. A common mistake we see is a business owner sending a proposal by email and only later asking for a signed confidentiality agreement — by then the damage is often done.
What should a Nepal-ready NDA cover?
A strong NDA template for Nepal needs at least six essential clauses. First, it must define what counts as "confidential information" — be specific: formulas, customer data, financials, unreleased designs, source code. Second, it must list the permitted uses — usually a single purpose, such as "evaluating a potential distribution partnership." Third, it should state the duration of confidentiality; three to five years is common, though trade secrets can be kept perpetual. Fourth, include exclusions — information already public, independently developed, or received from a third party. Fifth, add a return-or-destroy clause for documents and samples. Sixth, specify the governing law — choose the laws of Nepal — and the dispute resolution forum, typically the courts in Kathmandu or arbitration. A lawyer can tailor these clauses to your exact situation; the template is a starting point, not a finished document.
| Clause | What it does | Why it matters in Nepal |
|---|---|---|
| Definition of confidential info | Lists exactly what is protected | Nepali courts need specificity; vague descriptions weaken enforceability |
| Permitted purpose | Limits use to one stated goal | Prevents a manufacturer from using your design for its own product line |
| Duration of obligation | How many years the duty lasts | 3–5 years is standard; trade secrets can be marked as perpetual |
| Exclusions | Carves out publicly known or independently developed info | Stops the other party from claiming they already knew everything |
| Return/destruction of materials | Requires deletion or return of all copies | Critical when a partnership ends or a pitch is rejected |
| Governing law and disputes | States that Nepal law applies | Keeps any litigation local rather than in a foreign court |
How do you put an NDA in place — step by step?
- Identify what needs protection. Write down the specific information — recipes, code, client lists, financial models — before you draft a single clause.
- Choose the right type of NDA. A unilateral NDA binds one party; a mutual NDA binds both. Most Nepali SMEs start with unilateral.
- Draft the agreement. Start from a reliable Nepal-aware template, then adapt the six clauses above. Have a Nepali lawyer review the final draft.
- Sign before you share. Both parties sign two original copies — one for each side. Digital signatures are growing in acceptance but wet-ink signatures remain the norm in Nepal.
- Mark everything confidential. Stamp or watermark documents, emails, and samples as "Confidential" so there is no ambiguity later.
- Keep a signed copy and a log. Record the date, what was disclosed, and to whom. If a dispute arises, this contemporaneous record is your best evidence.
How does an NDA interact with trademark and patent filings in Nepal?
An NDA and a DoI registration serve different purposes — and you often need both. Imagine you have invented a new weaving technique for Dhaka fabric. The NDA lets you discuss the technique with a textile mill without fear they will copy it. But to stop a competitor from using the method, you need a patent registered with the Department of Industry, which gives you a seven-year exclusive right (renewable) under the Patent, Design and Trade Mark Act 1965. Similarly, sharing a new brand name under an NDA gives you no priority at the DoI — Nepal is first-to-file, so someone else can register the same mark if you have not filed yet. The NDA buys you time and trust; the DoI filing buys you legal ownership.
What are the most common NDA mistakes Nepali businesses make?
The biggest mistake is not signing one at all — a handshake and verbal promise carry almost no weight in a commercial dispute. The second mistake is using a generic template downloaded from a foreign legal website that does not reference Nepali governing law or courts; if you ever need to enforce it, you are stuck arguing foreign law. Third, some businesses describe the confidential information so broadly ("all information shared") that a court may find it unenforceable for vagueness. Fourth, people forget to mark documents as confidential at the time of sharing — a later claim that "everything was secret" is hard to prove. Fifth, an NDA signed after disclosure is usually worthless for information already handed over.
A realistic Nepal example
Suppose a small distillery in Pokhara has developed a new millet-based spirit and wants a contract manufacturer in Hetauda to produce it at scale. Before sending the formula, they sign a unilateral NDA that defines "confidential information" to include the recipe, the distillation steps, the millet variety, and the packaging design. The manufacturer may use the information only to produce the spirit for the Pokhara company and must destroy or return all documents within 15 days if the agreement ends. Six months later, the partnership dissolves. If the manufacturer then launches its own millet spirit using the same formula, the distillery can sue for breach of contract and seek damages — and because the NDA specified Nepal governing law and the Kathmandu courts, the litigation stays local. In parallel, the distillery files its brand name as a trade mark with the DoI so the label itself is also protected under the PDTA 1965.
How does an NDA work when the other party is outside Nepal?
When you sign an NDA with a foreign buyer, distributor, or investor, you face a practical enforcement challenge — suing someone in their home country is expensive and slow. The smart approach is to include a clause stating that any dispute will be resolved in the courts of Nepal, applying Nepali law. If the other party has assets or a presence in Nepal, that gives you real leverage. If not, consider adding an arbitration clause — Nepal is a signatory to the New York Convention on the recognition and enforcement of foreign arbitral awards, which means a favourable award in a neutral venue like Singapore can be enforced in many countries. A standard NDA template will not handle cross-border enforcement properly — you need a lawyer who understands both jurisdictions.
Where do NDAs fit in your wider business-protection strategy?
Think of an NDA as the first line of defence — it is fast, private, and costs nothing to file. But it is not a substitute for the registered rights the Department of Industry grants. A name shared under an NDA is not a registered trade mark; an invention disclosed under an NDA is not a patent. Use the NDA to safely have the conversations you need, then use the DoI filings to build public, enforceable ownership. For a brand, that means a trademark conflict check and a DoI application under the appropriate NICE class. For an invention, that means a patent filing before any public disclosure. The two tools — contracts and registrations — are stronger together.
In short: a properly drafted NDA template for Nepal gives you a private, enforceable contract that protects your business secrets before you share them. It costs you nothing to file with the government, works alongside the Patent, Design and Trade Mark Act 1965, and can be signed the same day you write it. Just make sure it names Nepal as the governing jurisdiction, describes the confidential information with enough detail, and is signed before you hand anything over. Paired with the right DoI registrations, it is one of the smartest and lowest-cost steps a Nepali business can take.
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Need a confidentiality agreement that actually works under Nepali law, or want to pair it with a trademark filing at the Department of Industry? Talk to us — we will help you get the right protection in place before you share your next big idea. You can also search our knowledge base for more guides on contracts, IP, and business protection in Nepal.
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