Noteworthy points arising from the legislative changes
The Council of Intellectual Property has already recommended that the popular "saisie description" proceedings will not be extended also to cover alleged violations of trade secrets.
The Law provides for the exclusive competence of the Commercial courts for disputes regarding trade secrets. One noteworthy exception is the exclusive competence of the Labour Courts for disputes between employers and former employees regarding trade secrets. There are discussions ongoing about how to reconcile these competing competences so as to avoid duplicative proceedings before two different jurisdictions.
The time limit for bringing an action is five years beginning with the date that the owner of the trade secret became aware of the infringement.
Country
Czech Republic
Last reviewed
21.05.2018
Noteworthy points arising from the legislative changes
In case of unlawful acquisition, use or disclosure of a trade secret the authorized person may seek the infringer to refrain from acts infringing/endangering the rights and to remove the consequences of such endangering or infringement. In such case the authorized person may seek:
the infringing/endangering products to be recalled from market,
the infringing/endangering products to be permanently removed/destructed;
the materials/tools or equipment intended for/used in the course of activities endangering/infringing the rights to be recalled, permanently removed or destructed.
Alternatively, the court may order (upon the request of infringer) the payment of a pecuniary compensation to the authorized person, namely where the infringer neither knew nor was able to know that his acts constitute an infringement, where the above measures would cause him an inadequate injury and the pecuniary compensation to an authorized person proves to be sufficient.
The court may award the person whose claim has been satisfied a right to make the judgment public at the costs of the infringer.
Under the Directive, the duration of the limitation period shall not exceed 6 years. The Czech civil code determines the limitation period to be 3 years.
The Czech legal system does not explicitly regulates the whistleblowing which is referred to in recital 20 of the Directive. Therefore, there is a certain risk that whistleblowing could be misused as an excuse for the violation of the trade secret.
Country
Denmark
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The Trade Secrets Act contains legal definitions of the terms 'trade secret', 'trade secret holder', 'infringer' and 'infringing goods'. Those terms were not previously legally defined.
Following the TSD, acquisition of trade secrets through independent discovery and reverse engineering is legal. This has been included in the Trade Secrets Act but was not previously explicitly stated in Danish law.
The Act does not contain all rules on trade secrets. The Danish Criminal Code also contains certain rules on the illegal acquisition of trade secrets. The Danish Government has chosen not to change this state of affairs, which means that the question of employees and persons otherwise connected to an organization stealing trade secrets will be governed by the new Act, whereas the question of people that are not connected to an organization stealing trade secrets will be governed by the Criminal Code.
The implementation of the TSD into Danish law does not constitute substantial or material changes to the current Danish rules on the question of illegal acquisition of trade secrets.
Country
Finland
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
In Finland a new Trade Secret Law has been passed which replaces the provisions in the Unfair Trade Act. The Trade Secret Law implemented the TSD without major modifications. However, the Law also contains provisions that establish a secrecy obligation with regards to trade secrets in different situations (for example, for company directors, employees and parties to a confidential business relationship).
The Finnish Trade Secret Law also contains protection for so-called ‘technical instruction’. This will maintain the current protection in Finland for documents which are less confidential but that have been given to employees or business partners in confidence.
If trade secrets have been unlawfully used, the infringer has to pay compensation, even if it is not possible to show any concrete damage. The amount of compensation payable is the hypothetical license fee of said trade secrets. In this regard, therefore, trade secrets are very close to other intellectual property rights.
Finnish legislation already enables good protection of trade secrets from third parties in the course of legal proceedings. However, the new Law also includes provisions which entitle the court to limit the number of persons from the parties to proceedings who have a right to receive knowledge of the trade secrets.
Trade secret cases may be handled in district courts or alternatively, in certain circumstances, in the market court, which is also called the IPR court.
Together with the criminal measures, the Finnish legislation will give good protection to trade secrets.
As a result of the implementation of the TSD, over 100 Finnish laws which included references to a secrecy obligation relating to trade secrets have been amended. In most cases it means only that the protected information will in future be called a trade secret (the terminology has historically not been consistent across different laws).
Country
France
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The current bill does not provide for :
criminal sanctions;
specific rules as regards to the Court having jurisdiction: it means that usual commercial Courts will have jurisdiction, as opposed to what is applicable to IPRs for which only one or a few specific civil Courts have jurisdiction.
The Decree passed on 11 December 2018 provides for:
Actions to prevent or end a trade secrets breach
The judge has the power to order, in ex parte or inter parte proceedings, provisional or protecting measures in order to prevent or end a trade secret breach and in particular:
prohibit the performance or continuation of acts of use or disclosure of a trade secret;
prohibit acts of production, offering, marketing or use of products suspected of being the result of a significant breach of a trade secret, or of importing, exporting or storing such products for these purposes;
order the seizure or return of such products, including imported products, to a third party in order to prevent their entry into or circulation on the market.
However, if the claimant does not file an action on the merits within 20 days working days or 31 calendar days if the latter period is longer from the date of the order, then the effect of the provisional or protecting measures will expire.
The judge can authorize the defendant to use the alleged trade secret breach by subordinating it to the provision of a financial guarantee in order to indemnify the trade secret holder. Also, conversely, the judge can order the constitution by the claimant of a guarantee in order to indemnify the defendant if the proceeding doesn’t succeed. Preservation of the trade secrets before the courts
A person who invokes the trade secret protection for a document whose disclosure is requested has to provide the judge with : - the complete confidential version of the document
a non-confidential version or a summary version of the document
a memorandum justifying the confidentiality of each element for which the protection is required
The judge can foreclose the access to the document only for the persons entitled to assist or represent the parties, and decide that these persons cannot make any reproduction or copy without the authorization of the owner of the document. Also, the judge is entitled to order the communication of the full version of the document if it is necessary to the complete resolution of the dispute. However, the judge can still control the access to it by limiting its communication only to certain individual.
Country
Germany
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The TSD is going to be implemented by a new Act on the Protection of Trade Secrets providing protection against unlawful acquisition, usage or disclosure of trade secrets (Gesetz zum Schutz von Geschäftsgeheimnissen).
If enacted as proposed, the Act on the Protection of Trade Secrets will focus on four key issues:
clear definitions of legal terms (e.g. "trade secret") and prohibited acts in relation to trade secretsclaims that owners of a trade secret can raise against an infringer;
provisions on civil procedures in case of trade secret infringements;
new penalty provisions currently stipulated in the German Act regarding Unfair Competition
The Act on the Protection of Trade Secrets is expected to provide for three different remedies
Compensation of damage
Claim for destruction of trade secrets (by handing to a court clerk)
Claim for an account of profits.
The qualification of information as a trade secret requires that the owner of the trade secrets applies “appropriate measures to ensure non-disclosure of trade secrets”. The lack of such measures results in a complete loss of protection.
Whistleblowers are protected under the current draft, but only if they “act with the intent to protect the public interest”. The protection of whistleblowers therefore depends on the purpose of the disclosure. The political debate over this requirement is still ongoing.
Country
Hungary
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
Trade secret is no longer a right relating to personality, therefore Art 2:47 of the Civil Code is repealed. Trade secret enjoys a special protection granted by the Trade Secret Act and based on the logic and sanction system of intellectual property protection. The provisions of Civil Code apply generally to those questions which are not regulated by the Trade Secret Act.
The Trade Secret Act contains the special rules of the civil proceedings on unlawful acquisition, use and disclosure of trade secret, and the provisions of the Code on Civil Procedure (“CCP”) [Act 130 of 2016] are subsidiary in these civil proceedings. According to the Government implementing these provisions to the CCP would have been contrary to the regulatory concept and nature of the CCP. The Regional Courts have jurisdiction in proceedings relating to trade secrets.
In the past both the Civil Code and the Unfair Market Practices Act could serve as a legal basis in case of violation of trade secret. Under the new Trade Secret Act, the Unfair Market Practices Act does not address protection of trade secrets anymore, as these are now protected uniformly by the new Trade Secret Act.
Country
Italy
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The unauthorised acquisition, use or disclosure of trade secrets performed with slight negligence can be considered unlawful.
Italian Courts may, as an alternative to provisional and precautionary measures, make the continuation of the alleged unlawful use - but not the disclosure - of trade secrets subject to the lodging of guarantees intended to ensure the compensation of the trade secrets holder.
Where provisional and precautionary measures are granted, but it is subsequently found that there has been no unlawful acquisition, use or disclosure of trade secrets or threat of such conduct, Italian Courts may order the trade secrets holder - upon the request of the respondent or of an injured third party - to pay appropriate compensation for any injury caused by those measures.
The limitation period for contractual claims and actions connected to unauthorised acquisition, use or disclosure of trade secrets has been reduced to five years.
The criminal penalties for the unauthorised acquisition, use or disclosure of trade secrets can be increased by up to one third if the behavior is performed with any IT equipment.
Non-compliance with Italian Courts' decisions concerning Intellectual Property rights (not just trade secrets) or with the confidentiality rules set forth during civil proceedings concerning trade secrets can be considered crimes.
The Italian legislator deemed it unnecessary to implement the TSD rules concerning whistleblowers because a specific Law (n. 179/2017) has already come into force.
Country
Netherlands
Last reviewed
21.05.2019
Noteworthy points arising from the legislative changes
The law closely follows the Directive. The subjective term of the statute of limitations is five years from the date that the holder became aware of the infringement. The objective term is 20 years after the fact.
There are three additions to the protection awarded by the Directive:
The successful party may be awarded remuneration of its reasonable and proportionate legal costs and other expenses unless equity would not allow this. In contrast to article 14 Enforcement Directive, this is at the discretion of the Court.
The Court may order in any case where trade secrets are at stake (not only in cases of enforcement of trade secrets) that the Court file and the hearings will only be accessible to the lawyers and thus not to a party.
The Dutch Supreme Court had already held in its judgment of 13-9-2013, ECLI:NL:HR:2013:BZ9958, NJ 2014, 455, Molenbeek v Begeer, that a saisie is also available for the enforcement of rights other than intellectual property rights. The government explanatory note to the new law states that this is a sufficient legal basis for saisies for the enforcement of trade secrets.
Country
Poland
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The bill also includes some amendments to the Code of Civil Procedure, introducing the possibility for an alleged infringer to apply for the court to order the lodging of a guarantee in the form of a deposit as means of compensation for the trade secret holder instead of applying the measures indicated in a preliminary injunction (such as an order for the prohibition and/or seizure of certain goods aimed at the prevention of further breaches). The court will decide on such motion after a hearing and it will be able to order the infringer to deposit a specific sum to a deposit account held by the Ministry of Finance. This mechanism will be new to the Polish civil procedure.
In addition to civil law liability, breaching a trade secret is also a criminal offence punishable by up to two years of imprisonment. The bill will expand the scope of this offence to also cover the use or disclosure of a trade secret in cases where the infringer learnt such trade secret when participating in a hearing, from the files of a case or in the course of other actions in connection with legal proceedings related to violation of a trade secret. This will primarily apply to witnesses, court experts, attorneys and any other participants to the proceedings.
Country
Slovakia
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The protection of trade secrets is covered by unfair competition provisions.
The limitation period for contractual claims and actions connected to the infringement and potential infringement of trade secrets is set to a maximum of six years.
Damages may be claimed in the amount corresponding to the minimum amount of remuneration and fees that the infringer would otherwise have to pay for a licence to use the trade secret.
Country
Spain
Last reviewed
06.02.2019
Noteworthy points arising from the legislative changes
The limitation period for bringing an action is fixed at three years beginning with the date the rights holder became aware of the infringement.
The New Act refers to civil law liability but refers to the Criminal Code for the most serious trade secret infringements (Articles 278 and 279 of the Criminal Code).
Unlike the Directive, the New Act includes a section defining the trade secret as an object of property: assignments, licenses and co-ownership.
Apart from the other measures established in the Directive, the proposal foresees the possibility of using the procedure of saisie-contrefaçon established in the Spanish Patent Act to obtain information regarding facts that are indispensable for the preparation of a corresponding claim.
The measures that courts are able to take due to breaches of the rules of good faith in proceedings have been strengthened
The transitional disposition of the New Act foresees its application to any trade secret regardless of the date of its legitimate acquisition. Only claims made before the entry into force of the new law would continue under the previous regulations.
Country
Sweden
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
Under the new legislation, more attacks on trade secrets will be considered unlawful than under the 1990 Act.
More attacks on trade secrets will result in liability to pay damages than under the 1990 Act.
The protection of secrecy for trade secrets in court proceedings is strengthened.
The minimum penalty for grave trade espionage is increased from a fine to imprisonment for six months.
Country
UK
Last reviewed
26.09.2018
Noteworthy points arising from the legislative changes
The Regulations make clear that trade secrets (as defined in the Directive) are a de facto subset of confidential information which is protected by the law of confidence in the UK. Accordingly, in so far as the measures, procedures and remedies available in an action for breach of confidence provide wider protection to a trade secret holder than that provided under the Regulations, the trade secret holder may apply for those (wider) measures, procedures and remedies in addition, or as an alternative, to those provided for in the Regulations.
Article 14 (1) of the Directive provides that Member States may limit the liability for damages of employees towards their employers for the unlawful acquisition, use or disclosure of a trade secret where they act without intent. However, the UK Government considers that there is no need to implement this provision as UK courts are able to exercise discretion to ensure damages are fair and proportionate.
