Implementation of the Trade Secrets Directive – The deadline has passed!

The Directive has also now been implemented by way of new legislation in a small number of other Member States.  However, in many Member States implementation has not yet occurred (although in most countries the legislative process for doing so is well under way). With offices across Europe, Bird & Bird has been following the implementation of the Directive and we set out the current status in a number of the key jurisdictions below.     

What will the Regulations change in the UK?

The Regulations introduce a new definition of a "trade secret". For information to be protected as such it must:

(a) be secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among, or readily accessible to, persons within the circles that normally deal with the kind of information in question,

(b) have commercial value because it is secret, and

(c) have been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret.

This definition, in particular the requirement to have taken reasonable steps to keep information secret is narrower than the existing definition of confidential information under UK common law.  

As well as a consistent definition of a trade secret, the Directive also aims to harmonise the remedies available to trade secrets holders in the event of a misuse or misappropriation of their trade secrets. To that end, the Regulations clarify the circumstances in which interim and final relief will be available. This includes protection in relation to goods which significantly benefit from a trade secret which was acquired, disclosed or used unlawfully.

The third principal area for harmonisation relates to the measures the court can use to prevent the disclosure of trade secrets during legal proceedings. The Regulations provide that the court may restrict access to documents and hearings in which trade secrets may be disclosed to a limited number of people (albeit that must include at least one individual from each party, in addition to lawyers/other representatives). This may be on application by one of the parties or at the court's own initiative. 

Whilst these measures are not expected to change UK law dramatically, the harmonisation and clarification they will bring both within the jurisdictions of the UK and across Member States is to be welcomed.

Implementation in other Member States

The UK, Denmark and Slovakia are leading the pack having implemented the Directive by the deadline. However, in many other Member States there is still some work to do to complete the course, as shown by the table below:

Aside from political and other factors, this also reflects the fact that the degree of implementation required in each jurisdiction is different. Whilst for some countries, such as the UK, the substantive change to the law is minimal for others the Trade Secrets Directive does herald a more significant change.

Regardless of the delay, it seems likely that by the end of the year the first cases will have been brought under the Directive, with the first indications of how national courts will apply its provisions following soon thereafter.