No public announcement: Overview, definition, and example
What is "no public announcement"?
A "no public announcement" clause is a provision in a contract that restricts one or both parties from making any public statements or announcements about certain aspects of the agreement, such as its terms, details, or the relationship between the parties. This clause is typically used to protect confidential information, maintain privacy, or prevent any potential negative impact from premature disclosure. It ensures that any sensitive or strategic information related to the contract is not shared with the public or the media without prior consent.
For example, a company may sign a deal with a partner but include a "no public announcement" clause to prevent either party from publicly disclosing the terms of the deal before an official press release or other pre-agreed communication.
Why is "no public announcement" important?
The "no public announcement" clause is important because it helps manage the timing and control of information that may affect business operations, reputation, or competitive advantage. By restricting public disclosure, the clause ensures that the information is shared only at the right time and in the right manner. This can prevent leaks, misinterpretations, or premature announcements that could negatively impact the parties involved.
For businesses, such a clause provides an extra layer of confidentiality, especially in negotiations, mergers, acquisitions, or sensitive partnerships. It also ensures that the terms of an agreement are disclosed in a controlled, strategic manner.
Understanding "no public announcement" through an example
Imagine two companies entering into a merger agreement. They agree on the terms of the deal but also agree to include a "no public announcement" clause. This means neither company can announce the merger publicly or release any information to the press until a designated time, such as after regulatory approval or when the deal is officially closed. This helps prevent rumors or unnecessary disruptions in the market before everything is finalized.
In another example, a celebrity might sign an endorsement deal with a brand, but the contract includes a "no public announcement" clause to prevent the brand from announcing the partnership until the marketing campaign is ready to launch.
Example of "no public announcement" clause
Here’s how a "no public announcement" clause might look in a contract or agreement:
“Neither party shall make any public announcement or disclose the existence or details of this Agreement to any third party, including the media, without the prior written consent of the other party. This restriction shall remain in effect until [specified date or event].”
Conclusion
A "no public announcement" clause is a critical provision in contracts that ensures sensitive information remains confidential until the appropriate time. It is commonly used in business agreements, such as mergers, acquisitions, partnerships, or endorsements, to control the timing and method of information disclosure. By preventing premature announcements, this clause helps protect the parties involved and ensures that information is shared strategically and responsibly.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.