European Parliament votes to adopt Trade Secrets Directive

Following the approval of the Parliament the Council should formally adopt the Directive at its next sitting on 17 May 2016.

Background

A first proposal for a Trade Secrets Directive was published by the European Commission on 28 November 2013. Both the Council and the Parliament suggested changes to this proposal, after which a so-called "trialogue" discussion began in 2015. 

The Directive seeks to harmonise the protection of trade secrets across the EU in three main areas:

1. the definition of what is a "trade secret" and how they will be protected;
2. the remedies available to trade secrets holders in the event of a misuse of misappropriation of their trade secrets; and
3. the measures the Court can use to prevent the disclosure of trade secrets during legal proceedings.

On 18 December 2015 a new draft was published as a result of the trialogue, with a clear note that this: “goes to the limits of the flexibility of the colegislators. It has therefore to be considered as a package-deal that cannot be reopened at any part without jeopardizing the whole agreement.” It was therefore expected that this text would be final.

What next?

Once adopted, Member States will have two years in which to implement the provisions of the Directive into national law. The UK Parliament has previously indicated that some changes to national legislation will be required as a result of the Directive, including to the Limitation Act 1980 and the Civil Procedure Rules. 

Of course, once the Directive is adopted the UK courts will be obliged to interpret the existing law of confidential information in line with its provisions which may cause existing case law to be treated with caution. This will be particularly interesting given that the current UK law on confidentiality is almost entirely derived from common law rather than statute.