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Oversight regulator calls for evidence on NDA misuse

By Michael Cross >>

(2 May 2023)

The Legal Services Board has opened a call for evidence on the role that lawyers’ conduct can play in the misuse of non-disclosure agreements (NDAs) as it considers regulation to clamp down on abuses. 

In a statement today, the oversight regulator said that while the majority of NDAs are lawful and can legitimately be used to protect sensitive business iinformation, ‘concerns are mounting about their misuse to conceal wrongdoing’. 

‘The LSB seeks to understand the scale, extent, and nature of misuse, consider why some legal professionals may fail to adhere to their professional ethical obligations when engaged with the misuse of NDAs, and explore the role regulation can play in making sure NDAs are only ever used appropriately,’ the statement said. 

LSB chief executive Matthew Hill said: ‘We want to make sure that regulation supports – and, where necessary, insists on – standards of conduct that ensure, as far as possible, that NDAs are never used to cover up wrongdoing, silence victims or deprive people unwittingly of their rights. This is something everyone across the sector should be concerned about.’

Hill said the LSB is interested in evidence from anyone with a view, including the ‘real experience of people who have been subject to misuse of NDAs’.

A Law Society spokesperson said: ‘This exercise by the LSB will provide a useful evidence base for regulators, the profession, employers and the public on how NDAs are being used in practice and to inform any changes to policy or regulation. We will be responding to the LSB’s call for evidence and following developments closely.’

The call for evidence runs to 14 July 2023.

(Courtesy: The Law Society Gazette)