Software as a Service Agreement – How do I draft the confidential information clause?

Summarise with: ChatGPT Claude Perplexity Microsoft Copilot

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Table of Contents

• What is ‘Confidential Information’?
• Privacy Law
• Conclusion

When drafting your Software as a Service (SaaS) agreement, it is important to include a clause that addresses confidential information and privacy for both you and your users. This will set out what is and is not considered confidential information and what is in the public domain. It will also determine how personal information will be protected and outline that the users should only disclose confidential information if required by law.

What is ‘Confidential Information’?

Confidential information can include information about the business, programs, technologies, software, processes, methods, operating procedures, products, agreements and prices and services, trade secrets, know how, financial, accounting, marketing and technical information, ideas, concepts, Intellectual Property, other customer information or details, and other information that relates to the business that is not in the public domain.

Users should agree not to disclose confidential information and protect any confidential information that they receive when using the software and services, as well as any other information they receive during the course of doing business with you.

Confidential information does not usually include information that is in the public domain, for example information about the software that is presented in marketing or on your website is not confidential unless the user previously breached the terms of use and placed the information in the public domain and then claimed it was not confidential. The user may in some cases be required to disclose confidential information as required by law, this should be addressed in this clause so the user can disclose the information if they are required to. But they should only provide the specific information requested.

Privacy Law

You should ensure that if you have a privacy policy that you incorporate it into the agreement. Your privacy policy should outline what personal or sensitive information you will collect, how user’s personal information is collected and protected and whether you will provide the information to third parties and for what reasons. You should also outline for what purpose you will use the personal information, for example for marketing or to provide other services. If you are interested in having a privacy policy, click the link above for more information.

You should also agree in your SaaS agreement to comply with the legal requirements of the Australian Privacy Principles as set out in the Privacy Act 1988 (Cth) and any other applicable legislation or privacy guidelines.

Conclusion

It is important to include well-drafted confidential information and privacy clauses in your SaaS agreement to ensure that you protect your user’s confidential information and your confidential business know-how and technology.  If you would like us to draft your SaaS agreement, or if you would like to learn more about confidential information, the online lawyers at LegalVision have extensive experience in these areas. We have assisted many online businesses to expand and grow while protecting their confidential information.  If you’re in need of legal advice, contact us on 1300 544 755 and speak with one of our experienced IT solicitors today.