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Your business will likely deal with a range of sensitive or confidential information. There can be many different kinds of confidential information, and you will need to protect it according to its particular nature and what laws apply to it. Therefore, it is crucial that you keep track of confidential information within your business and who has access to it. This fact is especially true when you operate online, where you will need to implement various security measures to avoid any unintended disclosure of your confidential information. For some guidance, this article will provide some background on disclosing confidential information in New Zealand.

What is Confidential Information?

Confidential information refers to information that you want to keep secret. For instance, you may have come across this phrase in your business contracts concerning specific confidentiality clauses. Such a clause would detail:

  • what information is confidential;
  • authorised disclosures, referring to with whom you can share the information; 
  • duties or responsibilities when dealing with this information; 
  • what qualifies as a breach of confidentiality; and
  • what happens if there is such a breach or unauthorised disclosure.

Additionally, contracts such as non-disclosure agreements impose a duty of confidentiality on all parties. Confidential information, in general, can include:

  • client information;
  • supplier data;
  • personal information;
  • trade secrets;
  • market strategies; or
  • price lists.

However, there are different kinds of confidential information that may have other laws that regulate how you can deal with them. 

Confidential Intellectual Property Information

A particular kind of information that you want to keep confidential includes certain kinds of intellectual property information. This fact is especially true for intellectual property that is still in its developmental stages, for which you have not begun any registration applications. Notably, certain kinds of intellectual property rights, such as design rights and patents, require that you have not disclosed the content of your application publicly or commercially. Therefore, you need to ensure that you keep this information confidential to avoid endangering your registration application.

Additionally, trade secrets are another kind of intellectual property that you want to keep confidential. These are methods or processes unique to your business that bring commercial value and profit. They can include:

  • recipes;
  • formulas;
  • methods; and
  • pieces of information.

You can protect this information with contracts such as non-disclosure agreements or confidentiality clauses in wider agreements.

Personal Information

Another kind of confidential information is personal information. This type of data refers to any information you can use to identify a living person, whether on its own or in combination with another piece of information. For example, this may include:

  • names;
  • photos;
  • email addresses;
  • IP addresses;
  • physical addresses;
  • phone numbers; or
  • financial information.

New Zealand’s privacy law, detailed in the Privacy Act, details how you must handle this information, including its:

  • collection;
  • disclosure;
  • usage;
  • storage;
  • security; and
  • disposal.

Further, if you do not comply with what the law requires, you can face fines and legal proceedings.

Notably, privacy issues become more important when operating online due to how easy it is to distribute information on the internet. Therefore, you need to implement appropriate security and control measures to keep this information confidential.

What Does Disclosure Mean?

Disclosure refers to the sharing of information, and some disclosures will not raise any issues. When dealing with contractually confidential information, the contract should specify which disclosures are authorised and unauthorised. It should also detail the consequences of unauthorised disclosure, leading to a breach of contract. The party that leaked the information may then be liable for damages.

Other kinds of confidential information will also have similar specifications around disclosure. In particular, the Privacy Act specifies that you can only disclose personal information when:

  • you have the relevant individual’s consent;
  • another law requires disclosure;
  • you collected the information for the purpose of disclosure;
  • it is necessary for court proceedings; or
  • the disclosure does not identify the person the information is about.

If the disclosure is unauthorised, then it may qualify as a breach of privacy.

Additionally, the law imposes a general duty of confidence in certain situations, which if you break through unauthorised disclosure, you can face legal action. There are three requirements for this, which include:

  • the information itself must be confidential;
  • you can infer from the way that you got the information that it was confidential; and
  • you disclosed the information without authorisation.

For example, if you are a startup sharing information with potential investors, that sharing would give rise to a duty of confidentiality based on the context of the situation.

Key Takeaways

Confidential information is information that you want to keep secret, and there can be many different kinds. When you disclose this information, you share it with others, and if that disclosure is unauthorised, you can face legal penalties. If you would like more information or help with confidential information in your online business, LegalVision’s data, privacy, and IT lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0800 005 570 or visit our membership page.

Frequently Asked Questions

What is confidential information?

Put simply, confidential information is information that you want to keep secret. The nature of its confidentiality can vary, but there can be severe legal consequences for unauthorised disclosures depending on the situation.

What is personal information?

Personal information is any data about an identifiable individual. For example, this term refers to any information that you can use to identify a living person, such as their name or address.

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