NDA | Non-disclosure clauses in Licensing Agreements

June 2012

Quite often big users, especially in the online field but sometimes also in the area of traditional off-line, require the societies with whom they negotiate a licensing agreement to sign a Non- Disclosure Agreement, holding terms that would prohibit the societies to communicate the terms of their licensing agreements with these users to for instance other societies, and sometimes even to their own boards.

NDA's have been the subject of a legal advice in January 2008. There remained however open questions and  BIEM's outside legal counsel Me Hugues Calvet produces a note on the legal regime of the NDAs susceptible to be adopted in a licensing agreement (or as a pre-condition to open the negotiations), with the objective to provide the member Societies with a legal information which could be used during discussions with users or sisters societies on this subject.

January 2008

During negotiations with music users, the question of the possibility of inserting in the contracts “non-disclosure” clauses concerning in particular the licensing terms and tariffs applicable has been raised.

A note, has been prepared by an outside counsel on the legal issues raised by such clauses. 

It appears that, upon reading the notes, during the negotiations with a user, a society cannot be under an obligation to disclose to its sister societies the content of its discussions with users. However, once the agreement with the users concluded, the licensing society cannot keep the licensing terms and conditions of such agreement secret from its sister societies without violating the rights of such sister societies.

The confidentiality vis-à-vis third parties of the terms and conditions of the licenses granted to users will be ensured, in compliance with competition law, in such a manner as to preserve the interest of the exploitation of the repertoires concerned by the licenses.