It may not always be possible to protect a company’s know-how or business information by patents or other intellectual property rights. In this case, the only protection available to companies for this information is secrecy.

Similarly, a company may choose to keep its inventions a secret rather than divulge them to the public by patenting them. In fact, if a patent request is filed, competitors are made aware of the manufacturing formula or process. In addition, patents have a limited duration, whereas secrecy lasts as long as the information is not divulged.

The classic example of a well-kept secret is the formula for Coca-Cola. Instead of filing a patent for the invention of the formula, if it is indeed patentable, Coca-Cola Enterprises kept the composition of its famous drink a secret. The patent would have required the company to divulge the formula and would have allowed any competitor to manufacture the product after its patent expired. By keeping the formula a secret, the company has maintained a de facto monopoly over its drink since 1886.

Trade secrets are of great value, particularly for the innovative businesses. Innovative businesses are increasingly exposed to dishonest practices aimed at misappropriating trade secrets, such as theft, unauthorised copying, economic espionage or the breach of confidentiality requirements. Developments such as globalisation, outsourcing of activities and increased use of information and communication technology contribute to the increasing risk. Consequently, more and more people and companies have access to confidential know-how and information.

The Belgian Act of 30 July 2018 on the protection of trade secrets, which implements a European Directive, created a legal framework for the protection of trade secrets by modifying, among others, the Code of Economic Law and the Judicial Code. Thanks to that Directive, an equivalent level of protection throughout the Union is achieved.

What is a trade secret?

By trade secret we mean know-how and business information which is valuable because it is undisclosed, it is intended to remain confidential, and for which the holder has taken measures in order to keep it secret. Trade secrets can relate to many different kinds of information such as:

  • a list of costumers,
  • work processes,
  • technical knowledge,
  • a concept,
  • software,
  • research data,
  • a strategy,
  • contracts,
  • formula’s and recipes,
  • etc.

In order to qualify for trade secret protection, no application and no registration is needed. Your trade secret must comply with the three following requirements:

  1. It must be secret.
    This means that the information is not generally known or readily accessible to the persons who deal with it. Trivial information and the experience gained by employees in the normal course of their employment, are excluded.
     
  2. It must have commercial value.
    This means the information has commercial value because it is secret. For example, the recipes of all kinds of products such as drinks, food or paint. Should they not be secret, than they would (practically) not have any value. In fact, everybody would be able to make those products.
     
  3. You need to have taken reasonable measures in order to keep your trade secret confidential.
    This means that you have taken measures which guarantee that the information is kept secret.

Which measures can I take to protect my trade secret?

One of the requirements to enjoy trade secret protection is that you have taken reasonable measures to keep it confidential.

Such measures are for example:

  • physical protection by using surveillance of the company, a safe or separate archives;
  • digital protection like password protected systems, encryption, protection software;
  • storage of your trade secret in a digital vault like BOIP’s i-DEPOT ;
  • agreements with employees through non-compete clauses and non-disclosure clauses in the employment contracts or work protocols;
  • agreements with business partners and new connections through non-disclosure agreements.
Last update
15 April 2019