A virtual data room is a tool that allows companies to communicate confidential information securely. This kind of tool is especially useful during business transactions where external parties are required to look over sensitive information. A VDR provides a means of sharing the information via email or by physically sending hard copies and can help organizations monitor the actions of document users. It also comes with additional security features such as timeouts, auto-expiration, and reports on the usage of documents.
The ideal VDR provider will be scrutinized regularly to ensure the highest levels of security in accordance with ISO 27001:2013 and GDPR requirements. The best providers will offer advanced features, such as dynamic watermarking that adds an individual label to each document, with the recipient’s email address and IP address to discourage unauthorised sharing or use. They also provide a secure document reader which allows users to browse documents without downloading them or expose them to potential risk.
A virtual data room is an important tool for businesses that require collaboration between several parties, including attorneys and accountants external and internal regulators, and adjusters. They helpful resources can help companies save significant amounts of money because they provide an all-in-one system that can share information and effectively communicate across multiple locations and time zones. Additionally it allows them to complete the due diligence process and make business-related strategic decisions much faster than feasible using paper-based systems. These benefits have made use of VDRs extremely common, especially in M&A transactions.