It should be used when one or both parties in a business arrangement are concerned about sharing confidential technical, financial, or business information.
It is commonly used at the start of business or investment negotiations so the parties can have open discussions without making confidential information available to competitors or the general public.
It's important to ensure any intellectual property created for the company is actually owned by the company and not by the person that created it.
Use an NDA before disclosing confidential information.
Mutual NDAs cover both parties to maximize protection.