Guide
NNN agreement or NDA: which should you sign with a Vietnam manufacturer?
An NNN agreement is a confidentiality contract that makes a supplier promise three things instead of one: not to disclose your information (non-disclosure), not to use it for anything except your project (non-use), and not to go around you to your customers, your other suppliers or your market (non-circumvention). A standard NDA, by name, only promises the first.
By Saola Manufacturing engineering team · Published · Updated
This guide is written for engineers and sourcing managers who are about to send drawings to a contract manufacturer in Vietnam. It explains what each agreement protects, what in an RFQ package is actually worth protecting, and where enforcement tends to break down across borders. It is general information from a manufacturer’s side of the table, not legal advice: have counsel who practices in both jurisdictions review any agreement before you rely on it.
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What is the difference between an NDA and an NNN agreement?
An NDA controls who else learns your information, while an NNN agreement also controls what the supplier itself may do with it. For a manufacturer, the second question usually matters more.
A factory that receives your drawing has little reason to publish it. The realistic risks are different: the drawing gets quoted to another buyer as a “similar part,” the tooling you paid for runs a second, unbranded order, or the factory contacts your customer directly once it knows who the parts are for. A pure disclosure clause is not written to catch any of these.
The label matters less than the clauses. Many well-drafted US NDAs already carry a “solely for the purpose of” restriction, which is a non-use clause in all but name, and some documents titled “NNN” are thin templates with weak definitions. Read what the agreement forbids, what it excludes, and who can enforce it where, instead of counting the letters in its title.
What in an RFQ package is actually confidential?
The drawing and model are only part of it; your commercial information is often the more valuable part. Volumes, target prices, the end customer, and the reasons behind a tolerance can all matter more to a competitor than the geometry does.
Walk through a typical package and sort it honestly. The 3D model and the toleranced drawing show how the part is made. The material and finish callouts show what you learned about corrosion, wear or regulatory limits. The quantity breaks and annual volume reveal the size of your program. A customer name in a title block, a file path or a PDF’s metadata reveals who you sell to. Any of these can be the thing a non-use or non-circumvention clause is really protecting.
Not everything on a drawing can be kept secret, though. Under US federal law, information counts as a trade secret only if its owner has taken “reasonable measures” to keep it secret and it is not readily ascertainable by proper means (18 U.S.C. § 1839). Vietnam’s Law on Intellectual Property sets a parallel test: the information must not be common knowledge or easily obtained, must give its holder a business advantage, and must be kept secret by its owner with necessary measures (Law No. 50/2005/QH11, Article 84). A part that is already on the open market can be measured, so its outside geometry is weak ground for a confidentiality claim; the internal features, the process notes and your commercial data are stronger ground.
Both tests reward the buyer who can show the steps taken, which is where drawing hygiene comes in:
- Mark it. Put a confidentiality legend and the agreement reference on every drawing sheet, and name the recipient company in it.
- Send less. For a first quote, send the part, not the assembly. Strip customer names, program code names and internal file paths from title blocks and PDF metadata.
- Stage it. A simplified model and drawing can be enough to price a part; release the full, controlled revision after the agreement is signed and the supplier is shortlisted.
- Log it. Keep a record of which revision went to which supplier, on which date, under which agreement. That record is your evidence of “reasonable measures” later.
The RFQ preparation guide covers what a supplier needs in the package to price it accurately; the points above cover what it does not need.
Which clauses should a supplier NNN agreement include?
At minimum: a precise definition of confidential information, a use restriction tied to one named purpose, a scoped non-circumvention clause, a flow-down to sub-suppliers, and a return-or-destroy obligation. Governing law, forum and language decide whether any of it can be enforced.
The table below sets the clauses side by side and shows what each one guards against in a manufacturing relationship. The right-hand column names the legal hook the clause relies on, which is worth knowing before you negotiate it away.
| Clause | Plain NDA | NNN agreement | Manufacturing risk it covers | Legal hook |
|---|---|---|---|---|
| Non-disclosure | Core clause | Core clause | Drawing or volumes passed to a third party | Contract; trade-secret law if “reasonable measures” were taken |
| Non-use | Sometimes, as a “purpose” limit | Explicit, tied to one named project | Your design run for another buyer or sold under the factory’s own name | Contract; Vietnam IP Law Article 84 conditions for trade secrets |
| Non-circumvention | Usually absent | Explicit, with named parties and a term | Direct approach to your customer, or to your other suppliers | Contract only; draft it narrowly |
| Sub-supplier flow-down | Often silent | Should be explicit | Drawing forwarded to a plating shop, foundry or tool maker | Contract; supplier stays liable for its sub-suppliers |
| Return or destroy | Common | Common | Old revisions in circulation after the program ends | Contract |
| Governing law and forum | Often the buyer’s home courts | Best matched to where assets sit | A judgment you cannot collect on | Civil Code choice of law; New York Convention for awards |
| Export control | Not addressed | Not addressed | Controlled technical data sent abroad without authorization | 15 CFR 734.13; no contract can cure it |
Two drafting points come up with almost every factory. First, define confidential information by category and by marking, and list the usual exclusions (already public, already known, independently developed, received lawfully from a third party). An agreement that tries to cover “all information of any kind” invites a court or arbitrator to read it narrowly. Second, keep non-circumvention specific: name the customers or supplier categories it covers and give it an end date. A clause that would stop a factory from ever making a similar part for anyone is the kind a tribunal may decline to enforce.
Tooling deserves its own document rather than a line in the NNN. Who owns a die or fixture, where it is stored, whether it may run parts for anyone else, and how it is returned are purchase-contract terms. As general contracting advice, state them in the purchase order or a tooling agreement, and reference that document from the NNN.
Why do cross-border confidentiality agreements fail at enforcement?
They fail when the agreement points to a forum whose decision cannot be enforced where the supplier’s assets are. A US court judgment and an international arbitral award travel very differently into Vietnam.
Vietnam has been party to the New York Convention on foreign arbitral awards since 1995, with reservations limiting it to awards made in other contracting states and to disputes treated as commercial under Vietnamese law (UNCITRAL status table). Foreign court judgments are a different path: Vietnam’s Code of Civil Procedure (No. 92/2015/QH13) generally recognizes them on the basis of a treaty or reciprocity, so ask counsel whether a judgment from your home court would be recognized before you rely on one.
The practical options buyers weigh are arbitration seated in a Convention country, or Vietnamese governing law with a Vietnamese forum. Vietnam’s Civil Code lets parties to a contract with a foreign element agree on the governing law, with listed exceptions (Civil Code No. 91/2015/QH13). US law can still reach some conduct abroad: the federal trade-secret statute applies outside the United States when the offender is a US person or company, or when an act in furtherance of the offense happened in the United States (18 U.S.C. § 1837). A Vietnamese factory with no US presence will rarely fit either condition, which is why the contract forum matters so much.
Language is the other half. Sign a bilingual English and Vietnamese version, say which language prevails, and confirm the signer is the company’s legal representative or holds a written authorization from that person. A clause the factory’s management never read in its own language is a weaker clause in front of any tribunal.
Does an NDA let you send export-controlled drawings abroad?
No. If a drawing is controlled technical data, sending it to a foreign supplier is itself an export under US regulations, and a confidentiality agreement does not authorize it.
The Export Administration Regulations treat the release or transfer of controlled technology to a foreign person as an export, including a release inside the United States (15 CFR 734.13). Most commercial parts drawings are not controlled, but parts for defense, aerospace or some dual-use equipment can be. Classify the drawing before it leaves your system, and keep that decision with the RFQ record. The NDA or NNN comes after the export question, never instead of it.
When is an NDA enough, and when should you insist on an NNN agreement?
A solid NDA with a purpose limit is usually enough to get early quotes on parts built to published standards. Insist on full non-use and non-circumvention terms when the design, the tooling or the customer relationship is the asset.
Signals that point to an NNN agreement: the part embodies a design you developed and have not patented; the program needs dedicated tooling such as a die-casting die or a progressive stamping die; the drawing reveals your end customer; you are sourcing through an agent or trading company, which makes non-circumvention of the factory itself relevant; or you plan to split a product across several factories so no single one sees the whole assembly.
Buyers moving a program from China to Vietnam often carry over a China-law NNN template. The structure transfers, but the governing law, forum, language and entity details need to be rewritten for the Vietnamese counterparty. Check that the party named in the agreement is the legal entity that will actually hold your drawings and tooling, not a sales office or an intermediary.
For work such as CNC milling at our lead CNC plant and die casting through partner foundries we manage, Saola will sign a buyer’s NDA, or send its own, before a drawing is shared. Say which agreement you need when you start a quote, or email rfq@saolamfg.com first.
Frequently asked
Is “NNN agreement” a legal term in Vietnam?
No. It is a trade label for a contract that bundles three obligations. A Vietnamese court or arbitrator will read the clauses under the governing law you chose, not the acronym in the title.
Should the agreement be mutual?
Often, yes. A factory shares process information, pricing and sometimes its own sub-supplier names during quoting, and a mutual agreement is easier to get signed quickly. The non-use and non-circumvention terms can still be one-way.
Does an NNN agreement settle who owns the tooling?
Not on its own. Put ownership, storage, permitted use and return of dies and fixtures in the purchase order or a separate tooling agreement, and reference it from the confidentiality agreement.
How long should confidentiality last?
Fixed terms are common for general business information, while genuine trade secrets are usually protected for as long as they remain secret. Agree the term with counsel rather than copying a template default.
Is this guide legal advice?
No. It is general information from a manufacturer’s perspective. Laws and their application change, so have a lawyer qualified in the relevant jurisdictions review your agreement.
Sources
- 18 U.S.C. § 1839, Definitions (trade secret), as amended by the Defend Trade Secrets Act of 2016, Legal Information Institute, 2016
- 18 U.S.C. § 1837, Applicability to conduct outside the United States, Legal Information Institute, 1996
- Trade secret policy, United States Patent and Trademark Office, 2026
- 15 CFR 734.13, Export (Export Administration Regulations), Legal Information Institute, 2026
- Viet Nam Law No. 50/2005/QH11 on Intellectual Property, WIPO Lex, 2005 (as amended)
- Viet Nam Civil Code No. 91/2015/QH13, WIPO Lex, 2015
- Viet Nam Code of Civil Procedure No. 92/2015/QH13, WIPO Lex, 2015
- Status: Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), UNCITRAL, 2026