Skip to content
AdvokatX
Menu
Try it free

NDA in Serbia (ugovor o poverljivosti): what it must contain and how it protects

NDA or confidentiality agreement under Serbian law: what it must contain, how long the duty lasts, contractual penalty, the Trade Secrets Law and mistakes.

INFO
Short answer. An NDA (non-disclosure agreement), in Serbian ugovor o poverljivosti, is a contract by which one or both parties undertake not to disclose certain information to third parties or use it outside the agreed purpose. Serbian law does not regulate it as a separate contract, so the general rules of the Law on Contracts and Torts (Zakon o obligacionim odnosima) apply. It also matters because of the Law on the Protection of Trade Secrets (Zakon o zaštiti poslovne tajne): information is protected as a trade secret only if its holder took reasonable steps to keep it secret, and an NDA is one of those steps.
ROK
Deadline. A claim for infringement of a trade secret can be filed within one year of the day the claimant learned of the infringement and of the person suspected of it, and at the latest within five years of the infringement, or of the last infringement if it is continuous. The proceedings are urgent. Claims under the contract itself, such as damages and a contractual penalty, are subject to the general limitation periods of the Law on Contracts and Torts: a claim for damages for breach of a contractual obligation becomes time-barred within the period that applies to that obligation, and the general limitation period is ten years. (Art. 6 of the Law on the Protection of Trade Secrets (Zakon o zaštiti poslovne tajne, "Sl. glasnik RS", No. 53/2021) and Art. 371 and 376(3) of the Law on Contracts and Torts.)

What an NDA is

An NDA is a contract by which the recipient of information undertakes to keep it confidential and use it only for the agreed purpose. It is concluded before negotiations on cooperation, an investment or the sale of a company, with outside contractors and suppliers who get access to data, and with employees.

Serbian law does not know the NDA as a named contract. It is subject to the general rules of the Law on Contracts and Torts (Zakon o obligacionim odnosima, "Sl. list SFRJ", No. 29/78 ... "Sl. glasnik RS", No. 18/2020) on the conclusion of contracts, liability for damage and contractual penalty. No form is prescribed, but for the sake of proof an NDA is always concluded in writing.

The confidentiality agreement (ugovor o poverljivosti) and the Trade Secrets Law

The Law on the Protection of Trade Secrets (Zakon o zaštiti poslovne tajne, "Sl. glasnik RS", No. 53/2021) protects information as a trade secret if three conditions in Art. 2 are met:

  1. the information is not generally known or easily accessible to persons who normally deal with that kind of information,
  2. it has commercial value because it is secret,
  3. the person lawfully in control of it has taken reasonable steps in the circumstances to keep it secret.

The third condition is why a confidentiality agreement is more than a formality. If a company shares data without any duty of confidentiality, it can hardly prove that it took reasonable steps. Reasonable steps also include an internal act on trade secrets, restricted access to data and marking documents as confidential.

Statutory protection and the contract complement each other. The law protects only information that meets the conditions for a trade secret, but it also works against third parties who obtained the secret unlawfully. The contract works only between the parties, but it can cover information that is not a trade secret within the meaning of the law.

The law also sets out what is not an infringement: independent discovery or creation, reverse engineering of a lawfully obtained product unless restricted by contract, and the exercise of employees' right to information (Art. 3).

What an NDA must contain

What matters is that the duty is specific: who keeps the information, what is kept, for what purpose it may be used and for how long. Three clauses decide whether the contract is worth anything in a dispute.

Definition of confidential information. A definition of "all information the parties exchange" is broad and the recipient can contest it. A definition that lists only a few documents can leave out what really matters. The usual solution is a general definition with examples and a rule that orally disclosed information is confirmed in writing within a short time.

Exceptions. Without exceptions for publicly known and previously known information the contract looks unbalanced and is harder to defend.

Consequences of breach. The amount of damage from disclosing information is hard to prove. A contractual penalty is therefore agreed, which the creditor can claim without proving damage. The amount should be proportionate to the value of the information, because the court may reduce a penalty that is disproportionately high.

In contracts with a foreign partner, governing law and jurisdiction are settled. Where the contract covers personal data, the Law on Personal Data Protection also applies, and an NDA does not replace a data processing agreement.

Common mistakes

  • A translated foreign model is used with concepts that do not have the same meaning in Serbian law, for example clauses on injunctive relief or liquidated damages.
  • The contract is signed by someone not authorised to represent the company.
  • The purpose of use is not defined, so the recipient argues that it did not disclose the information but only used it.
  • There is no duration, or the duty is unlimited for all information.
  • An NDA is used with employees instead of a non-compete clause, without the compensation the Labour Law requires.
  • The contract exists, but the company does not mark data as confidential or restrict access, so other reasonable steps are missing.
  • The NDA is signed after the meeting at which the information was already presented.

A short overview of the clauses usually found in the contract: contracting parties, definition of confidential information, purpose, recipient's duties, exceptions, permitted disclosure, duration, return and destruction of data, contractual penalty and damages, governing law and dispute resolution. This is an overview of content, not a ready-made contract text.

Sources

What to do

  • The contracting parties and whether the duty is one-way (only one party discloses information) or mutual.
  • The definition of confidential information: broad enough to cover what is exchanged, yet specific enough for a court to establish what is protected. It also states whether orally disclosed information is protected.
  • The purpose for which the recipient may use the information, for example assessing possible cooperation, and a ban on any other use.
  • Exceptions: information that is publicly known, that the recipient already lawfully held, that it developed independently, or that it must disclose by law or by order of an authority.
  • The circle of persons to whom the recipient may pass the information (employees, advisers) and its liability for them.
  • Duration: how long the exchange of information lasts and how long the duty of confidentiality continues afterwards.
  • Return or destruction of documents and data when cooperation ends.
  • Consequences of breach: contractual penalty, damages, governing law and the jurisdiction of a court or arbitration.

What it costs

An NDA is concluded as an ordinary written contract. Certification and solemnisation are not needed, so there are no notary costs or taxes. The parties choose whether to certify signatures, in which case tariff item 8 of the Notary Tariff (Javnobeležnička tarifa) applies. The contract can also be signed electronically: an electronic document cannot be denied validity or written form solely because it is electronic (Art. 7), and a qualified electronic signature has the same legal effect as a handwritten signature (Art. 50 of the Law on Electronic Documents, Electronic Identification and Trust Services in Electronic Business). The real cost arises in a dispute: court fees and representation costs depend on the value of the dispute, and proving the amount of damage often requires expert evidence.

FAQ

What does NDA mean?

NDA stands for non-disclosure agreement. In Serbia the terms ugovor o poverljivosti, ugovor o čuvanju poslovne tajne and sporazum o poverljivosti are used. The Law on the Protection of Trade Secrets expressly mentions a confidentiality agreement: using or disclosing a trade secret is unlawful if done by a person who breached such an agreement (Art. 4).

Is an NDA valid in Serbia?

Yes. Parties freely arrange their relations within the limits of mandatory rules, public policy and good customs (Art. 10 of the Law on Contracts and Torts). The contract may not forbid what the law allows or requires, for example reporting a punishable act in the public interest or employees turning to their representatives (Art. 17 of the Law on the Protection of Trade Secrets).

How long does the duty under a confidentiality agreement last?

The law prescribes no duration, so it is agreed. In practice periods of two to five years after cooperation ends are common, and for trade secrets in the narrow sense (formulas, source code, customer lists) a duty that lasts until the information becomes public. A duty unlimited in time for all information can be contentious.

How large a contractual penalty can be agreed in an NDA?

A contractual penalty can be agreed for non-performance of a non-monetary obligation, which the duty of confidentiality is (Art. 270 of the Law on Contracts and Torts). The law sets no maximum, but at the debtor's request the court may reduce a penalty it finds disproportionately high (Art. 274). The creditor can claim the penalty without proving damage, and if the damage exceeds the penalty, also the difference up to full compensation (Art. 275).

Does an employee have to sign an NDA?

The duty to keep trade secrets can be part of the employment contract, the employer's general act or a separate contract. An NDA should be distinguished from the non-compete clause in Art. 161 and 162 of the Labour Law (Zakon o radu). A non-compete after employment ends can last at most two years and is valid only if the employer undertook to pay the employee monetary compensation. An NDA may not serve as a disguised non-compete without that compensation.

What if the other party breaches the confidentiality agreement?

The holder of a trade secret can sue for a finding of infringement, cessation of the infringement, a ban on use, withdrawal of infringing goods, destruction or handover of documents, and damages (Art. 5 and 8 of the Law on the Protection of Trade Secrets). Under the contract itself the holder can claim the contractual penalty and damages. An interim measure can also be sought. The outcome depends on whether it can be proved what was disclosed, who did it and how large the damage is.