Be Careful When Translating Non-Disclosure Agreements! Explaining the Necessary Knowledge, Translation Methods, and Points to Note When Requesting!

1. Challenges in Translating Non-Disclosure Agreements

When conducting business with overseas companies or foreigners, the translation of non-disclosure agreements becomes necessary, and various challenges arise in the process.

1.1 Situations Where NDA Translation Is Necessary

There are many situations where the translation of non-disclosure agreements is required. For example, when conducting transactions or M&A with overseas companies, translation is indispensable for both parties to accurately understand the contract contents. Additionally, in joint development or technical partnerships with foreign companies, it is necessary to clearly agree on the handling of intellectual property and confidential information. Furthermore, when outsourcing work to foreigners, translating and concluding a non-disclosure agreement helps minimize the risk of information leakage.

1.2 Issues Related to NDA Translation

There are several challenges in translating confidentiality agreements. First, translation errors or insufficient understanding of the content can lead to significant risks. Even a single mistranslation of a contract clause can often cause legal troubles or information leaks. Additionally, since business practices and legal systems vary by country and region, a literal translation may not fit the local circumstances. Taking these differences into account, it is necessary to select appropriate expressions and provisions.

2. Prerequisite Knowledge Needed for NDA Translation

Translating a Non-Disclosure Agreement (NDA) requires not only language skills but also specific knowledge and attention to the unique aspects of contracts. Here, we explain the main prerequisite knowledge that translators should have.

2.1 Differences in Contractual Concepts and Cultures Between Japan and Other Countries

The basic concepts and cultures regarding contracts differ between Japan and overseas. In Japan, trust and tacit understanding tend to be emphasized, whereas overseas, the content explicitly stated in the contract is everything, and matters not written in the document are often not recognized. It is important to understand these differences when translating.

2.2 Legal accuracy is required

Since a non-disclosure agreement is a legally binding document, a high level of accuracy is required in its translation. Ambiguous expressions or mistranslations can result in the contract’s content not being conveyed correctly, potentially causing legal disputes.

2.3 Clear and unambiguous expressions are required

In contract translation, clear expressions that can be interpreted with the same meaning by anyone who reads them are necessary. Ambiguous phrasing and polysemous expressions should be avoided, and care must be taken to translate in a way that leaves no room for misunderstanding.

2.4 English NDAs contain technical terms, idiomatic expressions, and rules related to international commercial transactions

English non-disclosure agreements contain many legal terms, contract-specific idiomatic expressions, and rules related to international transactions. To correctly understand and appropriately translate these terms and expressions, specialized knowledge is indispensable.

2.5 There is a risk of damages and loss of credibility caused by translation errors

Translation errors in non-disclosure agreements can lead to information leaks and breaches of contract, resulting in serious risks such as claims for damages and loss of corporate credibility. Therefore, utmost care is required in the translation process.

3. Methods for Translating Non-Disclosure Agreements

There are mainly the following two methods for translating confidentiality agreements.

3.1 In-House Use of Machine Translation Tools and Post-Editing Services

In recent years, the accuracy of machine translation tools has improved, but for highly specialized documents like non-disclosure agreements that require legal precision, machine translation alone is often insufficient. Therefore, it is recommended to first use a machine translation tool and then request post-editing (corrections and proofreading after translation) by experts. This approach allows you to reduce costs while ensuring accuracy and reliability.

3.2 Outsourcing to Translation Companies

Another method is to outsource the translation of the confidentiality agreement to a specialized translation company. Since translation companies employ translators who are well-versed in the legal field, they can accurately and appropriately translate the contents of the contract. Especially for important contracts or when there is no legal or translation expertise within the company, outsourcing to a translation company can be considered the safest and most reliable approach.

4. Points to Note When Requesting Translation of Non-Disclosure Agreements

When requesting the translation of a confidentiality agreement from a translation company, it is necessary to confirm several important points in advance. Below, we explain the main points to be aware of when making such a request.

4.1 Criteria for Selecting a Translation Company

When requesting the translation of a confidentiality agreement, selecting the translation company is the most important factor. Check whether they have international legal knowledge and experience, review past translation cases, and assess their capability to handle specialized fields. Additionally, translation accuracy, quality control systems, and whether double-checking or native speaker reviews are conducted are also crucial criteria for judgment.

4.2 Confirmation of Translation Methods (Machine Translation Tools or Human)

Be sure to confirm in advance the method the translation company uses for translation. There is a difference in quality and nuance transmission between using machine translation tools and having a professional translator perform manual translation. For important documents such as non-disclosure agreements, it is preferable to choose human translation by experts or post-editing services where experts review and correct the results of machine translation tools.

4.3 Thorough Confirmation of Post-Editing and Review Systems

It is also an important point to ensure that post-editing and checking systems are in place after translation. To prevent mistranslations and inconsistencies in expressions, confirm whether proofreading by multiple people and legal checks are conducted. Since accuracy in legal terms and expressions is especially required, a thorough checking system is indispensable.

4.4 Security Systems

Since the contents of confidentiality agreements are highly sensitive, it is essential to also verify the security measures of the translation company. It is important to check in advance whether there is a reliable environment in place, including management systems to prevent information leaks, methods of handling data, and whether internal confidentiality agreements are in effect, so you can entrust the work with confidence.