Soumya Shekhar

Soumya Shekhar

Soumya is an independent legal consultant with over 7 years of experience. An alumnus of National Law University, Delhi and National University of Singapore, she has worked with various Tier-1 Law firms and is an expert in employment law, contract drafting and legal research. She enjoys writing and has been actively contributing articles for LegalKart for more than a year.

LegalKart - Download the app for consumer App

Download LegalKart

  • Trusted
  • Affordable
  • Secure
Download Now!
HIPAA Compliance Explained: Learn how to become HIPAA complaint

HIPAA Compliance Explained: Learn how to become HIPAA complaint

A HIPAA confidentiality agreement secures the protected healthcare information ("PHI") of clients and patients. These agreements derive their name from the United States' Health Insurance Portability and Accountability Act of 1996, which mandates that patients' healthcare information remains strictly confidential. Thus, these agreements enforce an organization's obligations under the Act. Such duties mainly deal with the healthcare status of an individual and healthcare payment-related details. 

Healthcare providers sign HIPAA with third parties. Such third parties include but are not limited to, supply vendors, employees, contractors, volunteers, and even patients. While other agreements have different nuances, they each have some standard features. A patient's is confidential, so none of the information can be shared, collected, or used by whichever party acquires them. Furthermore, HIPAA mandates both civil and criminal action against violators: Offences attract a fine of up to $ 1,500,000 yearly, while "wilful offenders" may receive a jail sentence of upto 10 years. 



HIPAA agreements are mainly concerned with the protection of a patient or client's health information. Thus, anyone signing the agreement cannot use, share or record such information without explicit authorization. 

However, patients may also accidentally have access to the health information of another patient. In such cases, they will be covered by HIPAA and have obligations under it. 



HIPAA covers agreements with "Business Associates", which are defined as organizations that are not the other party and are involved in handling sensitive personal information. These are limited to organizations providing administrative, legal, accounting, consulting, management, etc. They do not include vendors of medical supplies, who may only incidentally have access to PHI.

Nevertheless, hospitals and clinics must also sign a HIPAA Agreement with their vendors. This agreement should clarify the nature of the relationship, i.e. a vendor is not considered an "employee" but a contractor. However, it should clarify that even if vendors incidentally or accidentally access the PHI of a patient/client, they are to strictly not distribute, use, or record this information. This requirement is materially similar to HIPAA Agreements for patients.




Volunteers are individuals who are involved in assisting the organization in a variety of ways. Most of them are very involved in the use of patients' confidential health information. As a result, they must sign HIPAA contracts. 

Most organizations that regularly deal with volunteers and students develop HIPAA policies. These policies usually lay out the HIPAA obligations of any student or volunteer involved with the organization. A policy makes these obligations accessible and clearly defined. 

Apart from the obligations mentioned in the above two sections, volunteers have additional obligations since they are more closely involved with health data:

  • The PHI or confidential information of any patient should not be altered or deleted to any extent

  • The use of such data should be restricted to the minimum possible limit

  • Passwords and other information that gives access to sensitive data should be securely handled

  • Any concerns regarding the integrity of PHI are communicated to dedicated individuals within the organization

  • Revealing such data or using this information is indefinitely prohibited, even post-termination. 


It is crucial to confer confidentiality onto an individual's health data. HIPAA made a positive step in this direction by making it compulsory for organizations to handle this information. A culture has developed around HIPAA where organizations take their obligations seriously, and a patient's information is protected. Health information is deeply personal, and it must remain protected.

A variety of stakeholders can be exposed to a patient's data. This can include volunteers and contractors, but also other patients. Each of these individuals must understand their obligations under HIPAA. The contract is an effective way to provide adequate intimation and enforcement. While patients and vendors have reduced obligations, volunteers and interns are exposed to more PHI and thus require more scrutiny. Nevertheless, the system is generally conducive to protecting patient privacy and confidentiality.

What is Uniform Franchise Offering Circular (UFOC)?

What is Uniform Franchise Offering Circular (UFOC)?

Buying a Franchise is often an attractive investment for many people to earn good returns on a regular basis. Franchise, in simple terms, is a license granted by a Company to carry out business under its brand name. Thus, food outlets like Burger King, Subway give out their franchise to potential buyers. 


What is UFOC?


Uniform Franchise Offering Circular (“UFOC”) is a document that every person who wishes to purchase a Franchise shall go through. The Uniform Franchise Offering Circular is a document that contains all the vital information about the Franchise model. It is regulated by the rules made by the Federal Trade Commission’s Franchise Rule. Several countries in the world have made specific laws to deal with the working of Franchise businesses in their respective countries. The USA has a Federal Trade Commission which regulates the Franchise business. Unfortunately, India doesn’t have separate legislation to regulate the Franchise Business. It is regulated by the Franchise Agreement itself. 


Purpose Behind UFOC


The Franchise Rules set out by the Federal Trade Commission mandates full disclosure of information about investing in Franchise Business. The details set out in the circular help the potential buyers to identify the business. This way, a buyer can decide whether to invest the money in the franchise or not. 


The term ‘uniform’ plays a vital role as the franchises can’t change the terms and conditions of the UFOC. This helps the buyers to understand the entire business of the franchise (such as the expenses, future plans, Financial Statements, and various other obligations). It is given to the buyer before signing the Franchise Agreement and the payment thereof. Thus, a buyer should carefully read all the terms and conditions set out in the Uniform Franchise Offering Circular and understand it properly. 

The UFOC is monitored and administered by the North American Security Administrator Association (NASAA). To avoid any loss to the prospective buyer, the Federal Trade Commission made it mandatory for the UFOC document to be in plain English rather than complex legal language to be understandable for a layman. 


UFOC Guidelines


If we go through the Compliance Guide of Franchise Rule formulated by the Federal Trade Commission of USA, we will find details about the Disclosure Document and all the 23 items which need to be disclosed to the Franchise buyer. 


Under the Franchise Rule enforced by the FTC, the buyer must receive the document at least 14 days before the buyer is asked to sign any contract or pay any money to the franchisor. The buyer has the right to ask for a copy of the Franchise Disclosure Document. 


Some of the important items out of those 23 items of the Disclosure Document are as follows: 


ITEM 1: Franchises Background

Item 1 tells us about the entire history of the Franchise Business, i.e., How long the franchise has been in the market, who all are the competitors to the franchise. For example: If a person wants to buy a McDonald’s Franchise, item 1 will contain the date on which it was founded [i.e., 1955 (66 years)], its competitors (Burger King, Dominos, etc). 



Item 2 contains business experiences of certain important individuals, which may include Directors, MD, Principal officer, etc. Such experience gives an idea about who is running the business and is the person is capable enough to run it or not. 



Item 3 discloses all the lawsuits to which the franchisor or any of its executive officers are parties. 



Item 4 discloses whether the franchise, its affiliate, or any of its executives have been subjected to Bankruptcy. If yes, the buyer must carefully look at the Financial Statements of the Company of the last few years and check whether the business is in stable condition or not.  



This item discloses some pre-commencement franchise costs. Generally there is no Initial cost to the buyer before starting a business but if some franchise wishes to charge cost, they must disclose it in item no 5. It also explains other fees like royalties and advertising fees., training fee etc. The franchise shall also disclose the estimated initial franchise investment to the buyer. 



This item contains all the restrictions imposed on the franchisor. The limits include suppliers from whom one may purchase goods or the goods or services one may offer for sale etc. Such restrictions may limit your ability to carry out the Franchise Business. 



Franchisees are often required to contribute a percentage of their sales to ads and the training of their employees to run a business. Such costs have to be disclosed under this head. 



The franchise must disclose all kinds of Intellectual Properties they owe. 



The item will tell you about the terms of renewal, conditions for termination, and if there is a dispute between the Franchise owner and franchisor, how the dispute can be resolved. 



You can track the financial performance of the company under this item head. It is really important for any potential buyer to go through this item in order to make future decisions about investing in the Franchise Business. Poor Financial performance should be a big cross, and buyers shall not invest in such companies.  



Item 20 requires the disclosure of statistical information on the number of franchised outlets and company-owned outlets for the preceding three-year period. If the charts show more than a few franchised outlets in your area have closed, transferred to new owners, or transferred to the franchisor, it could be due to problems with the franchisor’s support or because franchises aren’t profitable.


UFOC Template

The Template of UFOC can be found on: 

How to Break a Non-Disclosure Agreement?
Agreement & Contract

How to Break a Non-Disclosure Agreement?

A Non-Disclosure Agreement ("NDA") is a legally enforceable agreement that falls under the ambit of the Indian Contract Act, 1872, which serves as the umbrella legislation for all contracts and agreements. This agreement protects and maintains the confidentiality of vital information disclosed between the parties, including trade secrets.

NDAs are also known as a confidentiality agreement (CA), confidential disclosure agreement (CDA), proprietary information agreement (PIA), secrecy agreement (SA), or non-disparagement agreement.

The NDA prevents the disclosure of a company's trade secrets or sensitive information to competitors or unauthorised parties who could use the knowledge to cause irreparable harm to the disclosing party. When they sign the agreement, the disclosing party and the receiving party agree on what constitutes confidential information and what does not.

NDAs preserve the confidentiality of information provided between parties and safeguard the business's intellectual property. Typically, the initial round of talks requires the disclosure of numerous sorts of information. This mandates that the parties remain committed by the NDA and refrain from violating it, as doing so may have legal repercussions.

What happens if you break a non-disclosure agreement?

A breach of an NDA is a civil wrong. NDAs are legally enforceable contracts. When parties sign an NDA, the party receiving the confidential information must keep it secret. If the receiving party chooses to divulge confidential information to an unauthorised third party or entity, the party will incur legal consequences or penalties.

In addition to obligating the parties to keep secret information private, NDAs offer legal remedies and penalties for any breach of the agreement, such as injunctions, indemnification, etc. In addition to injunctive remedies, breaches of NDAs can result in substantial monetary fines. Before signing a non-disclosure agreement (NDA), one should thoroughly review the document.

Why you should not violate a non-disclosure agreement?

NDAs deter persons from disclosing sensitive information to third parties or the general public, and severe penalties accompany them. In many circumstances, the agreement will specify the consequences of breaking the NDA. The following are some instances of penalties for violating an NDA: injunction, indemnity, damages, termination from employment, loss of business reputation, clients, etc.

A NDA would typically contain language that would entitle the Disclosing Party to resort to any legal remedies it deems fit. Such wide language in itself should sound a warning bell to the Receiving Party. It is better to comply with confidentiality obligations than breach a NDA.

Non-Disclosure Penalty Clause

It can be difficult to quantify the losses caused by a breach of the secrecy provision; thus, it may be advantageous to include a penalty clause that specifies an acceptable amount for the damage caused by a breach of contract. If the penalty is already mentioned in the contract, there will be a fear of having to pay substantial damages, which would not exist if the party intended to rigorously adhere to the contractual commitments.

The penalties for violating the agreement are often laid out in the agreement, including injunction, indemnity, and damages. It is essential to mention that the Specific Relief Act of 1963 and the Code of Civil Procedure, 1908 govern these preventive reliefs.

People Also Read This: Employee Confidentiality and Non-Disclosure Agreement for Employees


The non-breaching party may petition the court for an order prohibiting the Receiving Party from disclosing the secret information. The objective of requesting a temporary or permanent injunction is to prevent the defendant (the Receiving Party) from committing future violations or inflicting further injury to the aggrieved party (the Disclosing Party).


The Receiving Party must indemnify the Disclosing Party for any fees, expenses, or damages incurred by the Disclosing Party due to any breach of this Agreement's provisions. Court fees, litigation costs, and actual, reasonable attorney's fees are all included in this obligation.

People Also Read This: What Is A Non-Compete Clause In An Employment Contract?


If the Receiving party violates an NDA, the Disclosing Party may file a lawsuit in court to prohibit additional disclosures and sue the violating party for monetary damages.

In conclusion, non-disclosure agreements (NDAs) are low-cost, simple-to-create, legally binding contracts that keep private information confidential between two or more parties. When establishing an NDA, it is crucial to be as clear as possible so that all parties understand what information can and cannot be divulged, as well as the consequences for doing so. A contract may be null and unenforceable if the language is unduly broad, unreasonable, or burdensome. The courts will also contest or nullify contracts that are overly broad, oppressive, or attempt to contain non-confidential information. In addition, if the material is made public, the Disclosing Party is unable to enforce the NDA.

Always consult a lawyer before signing a nondisclosure agreement. Be on the lookout for onerous clauses and exercise extreme caution before signing. 

Consequences of violating a non-disclosure agreement (NDA)

Breach of a non-disclosure agreement (NDA) may result in legal action, such as a lawsuit, for breach of contract. Damages might vary depending on the agreement's terms, the gravity of the breach, and the magnitude of the harm inflicted. In addition, breaking a non-disclosure agreement can destroy a person's reputation, trustworthiness, professional relationships, and future employment opportunities. 

Download Legalkart app now

Get 5 mins of talk time Free !
LegalKart Apps

LegalKart- Your Legal Advisor App is for general users who need to avail services like consulting a Lawyer on phone, document drafting, getting property verified by lawyers.