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Brussels 10 January 2019
CHINA - STATE ADMINISTRATION OF MARKET REGULATION
The Trade Secrets Directive
Jorge NOVAIS
EUROPEAN COMMISSION DG for Internal Market, Industry, Entrepreneurship and SMEs F3 - Intellectual property and Fight against Counterfeiting
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Preliminary remarks
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• The Directive does not deal with criminal sanctions. Member States are free to have or not criminal law provisions on misappropriation of trade secrets
• The Directive harmonises the laws of Member States on civil law redress against misappropriation of trade secrets
• Misappropriation means: acquisition, use or discloser of the trade secret in cases where:1. There is no consent of the trade secret holder2. And there is breach of law, breach of contract or use of dishonest means
• The Directive grants the possibility of getting civil law redress such as injunctions, compensation and seizure of goods
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Preliminary remarks
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• The Directive does not give businesses any right to refuse to give or disclose information on the grounds that such information is a trade secret.
A – If there is a legal obligation of providing such information:companies will still have to comply
B – If there is no legal obligation of providing such information:companies can do as they pleasethe Directive does not grant them with a right to refuse disclosure, Companies do not need any such right
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EU Directive 2016/943 on trade secrets
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1. Definition of trade secrets and of right holder as in TRIPS
2. Misappropriation
3. Civil law measures and remedies
4. Protection of the information disclosed to the court
5. Exceptions and safeguards
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1. Definitions (as in TRIPS)
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EU Directive 2016/943 on trade secrets
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1. Definition of trade secrets and of right holder as in TRIPS
2. Misappropriation
3. Civil law measures and remedies
4. Protection of the information disclosed to the court
5. Exceptions and safeguards
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Misappropriation
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Clarification - The following conducts are lawful:
a. Acquisition, use or disclosure when required or allowed by law
b. Independent creation
c. Reverse engineering
d. Acquisition by any other honest means
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Article 3 - lawful acquisition, use and disclosure
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Unlawful acquisition
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Article 4 Unlawful acquisition
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No consent from the trade secret holder + use of dishonest means
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Article 4 Unlawful acquisition
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No consent from the trade secret holder + use of dishonest means
Knowledge that the person passing the trade secret is doing so unlawfully
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Article 4 Unlawful acquisition
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No consent from the trade secret holder + use of dishonest means
Knowledge that the person passing the trade secret is doing so unlawfully
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Unlawful Disclosure
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Article 4 Unlawful disclosure
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ii. Disclosure in breach of contract or law
i. Disclosure is unlawful if acquisition was unlawful
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Article 4 - Unlawful disclosure
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i. Disclosure is unlawful if acquisition was unlawful
Iii. Knowledge that the person that passed the trade secret did so unlawfully
ii. Disclosure in breach of contract or law
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Article 4 - Unlawful disclosure
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Disclosure is unlawful if acquisition was unlawful
Disclosure in breach of contract or law
Knowledge that the person that passed the trade secret did so unlawfully
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Unlawful use
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Article 4- Unlawful use
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Use is unlawful if acquisition was unlawful
Use in breach of contract or law
Knowledge that the person that passed the trade secret did so unlawfully
Trading tainted goods
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Article 4 - Unlawful use
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Trading tainted goods
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EU Directive 2016/943 on trade secrets
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1. Definition of trade secrets and of right holder as in TRIPS
2. Misappropriation
3. Civil law measures and remedies
4. Protection of the information disclosed to the court
5. Exceptions and safeguards
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Articles 10 and 11Provisional and precautionary measures
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• Cessation/prohibition of the use or disclosure of the information
• Prohibition of the production, offering, placing on the market or use of infringing goods, or the importation, export or storage of infringing goods for those purposes
• Seizure or delivery up of the suspected infringing goods
• Alternative measure: financial guarantees by the defendantat the requested of the defendant the Court may authorise continuation of use of the information while the legal action takes place subject to the lodging of guarantees intended to ensure the compensation of the plaintiff.
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Articles 12 to 15Measures resulting from a decision on the merits
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• Cessation/prohibition of the use or disclosure of the information
• Prohibition of the production, offering, placing on the market or use of infringing goods, or the importation, export or storage of infringing goods for those purposes
• Corrective measures with regard to the infringing goods:• recall of the infringing goods from the market• depriving the infringing goods of their infringing quality• destruction of the infringing goods or, where appropriate, their withdrawal from the market
• Destruction or delivery up of documents and objects
Alternative measure to the above: pecuniary compensation for further use
• Damages
• Publication of judicial decisions
• No Criminal measures establihsed by EU law. However, many Member States have criminal sanctions
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Some additional definitions
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EU Directive 2016/943 on trade secrets
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1. Definition of trade secrets and of right holder as in TRIPS
2. Misappropriation
3. Civil law measures and remedies
4. Additional definitions: infringing goods
5. Protection of the information disclosed to the court
6. Exceptions and safeguards
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Article 9Legal proceedings and confidentiality
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Parties, lawyers, court officials, witnesses, experts and any other person participating in the proceedings or having access to documentsare not permitted o use or disclose information acquired through the participation or access to documents.
Requirements:
1. Duly reasoned application by the interested party
2. Identification by judicial authorities as confidential
PLUS specific measures: limiting access to documents and hearings
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EU Directive 2016/943 on trade secrets
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I. Definition of trade secrets and of right holder as in TRIPS
II. More developed and detailed definition of misappropriation
III. Set of civil law measures and remedies
IV. Additional definitions: infringing goods
V. Protection of the information disclosed to the court
VI. Exceptions and safeguards
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Article 5Exceptions
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Article 8Limitation period
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Other safeguards
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Provisional and precautionary measures
subject to the lodging of adequate security to ensure compensation of necessary
Factors to take into account (a) the value and other specific features of the trade secret; (b) the measures taken to protect the trade secret; (c) the conduct of the respondent in acquiring, using or disclosing the trade secret; (d) the impact of the unlawful use or disclosure of the trade secret; (e) the legitimate interests of the parties and the impact which the granting or rejection of the measures could have on the parties; (f) the legitimate interests of third parties; (g) the public interest; and (h) the safeguard of fundamental rights
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EU Directive 2016/943 on trade secrets
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I. Definition of trade secrets and of right holder as in TRIPS
II. More developed and detailed definition of misappropriation
III. Set of civil law measures and remedies
IV. Additional definitions: infringing goods
V. Protection of the information disclosed to the court
VI. Exceptions and safeguards
WHAT IS OUT OF SCOPE OF THE DIRECTIVE?some clarifications
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Article 1(1) what is out of scope?Free speech, regulatory and transparency duties
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Unlawful acquisition
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Preliminary remarks
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• The Directive does not give businesses any right to refuse to give or disclose information on the grounds that such information is a trade secret:
A - There is a legal obligation of providing such information:companies will still have to comply
B - There is no legal obligation of providing such information:companies can do as they pleasethe Directive does not grant them with a right to refuse disclosure, Companies do not need any such right
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Article 1(2) what is out of scope?Experience and skills of employees
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Further information
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Visit our website for background information: http://ec.europa.eu/growth/industry/intellectual-property/trade-secrets/index_en.htm
Official legal texts!
Search in http://eur-lex.europa.eu/
Legislative procedure: http://eur-lex.europa.eu/procedure/EN/2013_402?qid=1462203329772&rid=1
ContactJorge NOVAIS GONÇALVES: [email protected]
Elena Kostadinova
European Commission, DG Internal Market, Industry, Entrepreneurship and SMEs (DG GROW)Directorate F: Innovation and advanced manufacturingUnit F3: Intellectual Property and Fight against Counterfeiting