Harmonized protection of trade secrets in Europe Late last year, the European Commission (“the Commission”) published proposals for a directive to protect trade secrets against unlawful acquisition, use and disclosure. There is currently no common European approach to the protection of trade secrets, with the result that the law varies between the different Member States. The draft directive is part of an initiative formed to promote business innovation in the European Union. The Commission feels that the difficulty and cost of protecting trade secrets in cross-border research and development activities hinders innovation. If approved by the Parliament and Council, the draft directive may be in force by the end of 2014. Member States will then have a further two years to transform it into national law. The following three features of the directive are noteworthy: First, the draft directive provides a common definition of a trade secret as information which: 1. is secret in the sense that it is not generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question; 2. has commercial value because it is secret; and 3. has been subject to reasonable steps under the circumstances, by the “trade secret holder”, to keep it secret. Second, the directive establishes a common set of procedures and remedies for trade secret holders where there is unlawful acquisition, use, or disclosure of that trade secret. The directive also includes rules on the preservation of trade secrets during litigation. Third, the directive provides uniform remedies for trade secrets misappropriation across Member States, including injunctive and declaratory relief, damages, and sanctions for non-compliance. Although trade secrets, e.g. the Coca-Cola recipe, can provide businesses with a significant economic advantage over their competitors, the following issues should be carefully considered before determining whether your information is best protected as a trade secret or by a patent: • if your trade secret is revealed, everyone has access to it without restrictions; • competitors might be able to reverse engineer your product, discover whats in it and legally use it; • patents afford more legal protection than a simple trade secret; and • if someone else legitimately comes up with the same thing, he can patent it instead.
Posted on: Thu, 22 May 2014 01:24:32 +0000
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