In several occasions we are determined to undertake. But when starting a new business, there are many issues to consider and as well as many concerns.

The first concern that may arise is whether I can get any protection when I communicate my idea to someone else. Is it convenient to sign a contract or a confidentiality agreement?

Ideas are not protected. Sometimes an entrepreneur’s idea is not so novel in itself, but the added value is provided by the entrepreneur (because of his experience, contacts, artistic taste, training…) and this is what will differentiate his product or service from others, so in this case it may not be necessary for the person receiving the information to sign a confidentiality agreement (e.g. I am going to create a sustainable clothing company). But often that idea or project is accompanied by other elements that can bring a competitive advantage to the entrepreneur. For example, the entrepreneur informs the person who has to look for premises with certain characteristics, in a specific location, to carry out a certain activity, being interested that the third parties do not know his strategy in this phase of the project.  In these circumstances, the commitment to confidentiality is already important, as is also the case if the entrepreneur commissions the creation of a sign that is intended to be the future brand name or the commercial name of the products.

In other cases, the need of a confidentiality agreements is much more intense, either because it is a unique or novel design, or because an inventive activity is being developed, or it is a highly novel business model (breakthrough). This is information that has a potential “business value” and the entrepreneur wants to keep secret and for that purpose. Therefore, he must establish “reasonable measures” to keep the secret, being the confidentiality agreement one of those “reasonable measures” to be legally considered as a trade or business secret with the protection provided by the law.  For example, usually, the proposed activity of manufacturing sneakers is not considered a secret. But the competitive advantage that the entrepreneur intends to obtain and intends to differentiate from competitors (materials, suppliers, business plan, etc.) may constitute trade secrets if a confidentiality commitment is entered into the persons who have or may have access to such information (e.g., collaborators) as an expression of the entrepreneur’s willingness to maintain ownership of that information.

At HERNANDEZ MARTI ABOGADOS we have extensive experience in contracts, foreseeing different scenarios depending on the relevant sector; confidentiality agreements; and distribution and agency agreements. Our experience is extensive in several fields: fashion, textiles, cosmetics, ceramics, or the toy industry, among others.