We spoke with oneNDA co-founder Electra Japonas about the need for contract consensus, and the risk presented by the likes of ChatGPT in terms of moving away from standardisation.
oneNDA, a global contract standard for Non-Disclosure Agreements (NDAs), announced on 16 October that it has been acquired by Law Insider, which is one of the largest subscription-based contract and clause databases in the world, with over three million users.
oneNDA’s standard was issued in 2021 and has been adopted by 4,000 companies. It is used around seven million times a year, eliminating the time it might otherwise take to review and negotiate NDAs.
Through the acquisition, the oneNDA.org standards library will be made available for free. oneNDA co-founder Electra Japonas will join Law Insider as its first chief legal officer.
Speaking to Legal IT Insider at Legal Geek, Japonas said: “Law Insider has three million users and a big presence in the US, so it gives us an immediate distribution channel there. We will use their data to build more standards for other agreements and we need data insights to do that. We’re now able to scan millions of contracts to find out what is market. There aren’t that many rich databases like Law Insider and we can now build standards and tools to help automate contract creation and use AI tools to help people review third party agreements against standard third party principles.”
oneNDA has a data processing agreement that is not yet widely adopted, and that will be one of its next objectives. Japonas said: “I’m going to build more standards and more community around those standards.” Other contracts in sight include MSAs, SOWs, Cloud Service Agreements, EULAs and SLAs.
In-house lawyers spend over half their time reviewing contracts and Japonas said: “Is that really why they went in-house? The only way to solve the problem is through community consensus around what is fair and balanced, so that people can work in a seamless way.”
She says that the need for widespread adoption of standardised contracts is greater than ever, commenting: “Everyone is using ChatGPT to generate contracts and there will be loads of bad quality contracts, so we need to accelerate adoption of oneNDA.” She added: “I love AI and use ChatGPT all the time, but this is not the right use case.”
Japonas, got the idea for oneNDA from her time working in the space sector, where the whole of Europe contracts on standard documents provided by the European Space Agency. Other successful examples of contract standardisation include the International Swaps and Derivatives Association, which has created an ISDA standardised contract for derivatives transactions.
To promote the adoption of oneNDA and Law Insider Standards, Law Insider will offer an automated version of all of its standard contracts that will enable adopters to create, send and eSign the standards for free. Additionally, all standard playbooks will be available for free through an AI-powered Word Add-In and will provide instant redlining suggestions and comments.
caroline@legaltechnology.com