Know-how or companies' business information cannot, always, be covered by a patent or other intellectual property rights. In such cases, the only type of protection businesses can use for this information is secrecy.
Similarly, a business can decide to keep its inventions secret rather than disclose them to the public, e.g. by patenting them. Indeed, when a patent is filed, competitors find out the manufacturing process or formula. What's more, the patent is of limited duration, while secrecy lasts for as long as the information is not disclosed.
The classic example of a well-kept secret is the Coca-Cola formula. Instead of filing a patent for the invention that included the formula, insofar as that would be possible, Coca-Cola decided to keep the composition of the famous drink secret. A patent would have required to disclose the formula and would have allowed all competitors to create the product once the patent expired. By keeping the formula secret, the company has maintained a de facto monopoly on the drink since 1886.
Trade secrets are very valuable, particularly for the innovation economy. Such companies are more and more exposed to dishonest practices. Such practices are aimed at illegally obtaining trade secrets, such as theft, unauthorised copying, industrial espionage and non-compliance with confidentiality obligations. Developments such as globalisation, the subcontracting of certain jobs and the increased use of information and communication technologies contribute to the increased risks. More and more people and businesses, therefore, have access to confidential information and know-how.
The Law of 30 July 2018 on the protection of trade secrets, which transposes a European directive, modifies the Code of Economic Law and the Judicial Code to provide a legal framework to protect trade secrets. Thanks to this European directive, a similar level of protection covers the entire European Union.
What is a trade secret?
A trade secret means commercial information and know-how that are valuable due to their secret nature, that must remain confidential and whose holder took measures in order to keep it secret.
Trade secrets can cover many different types of information, such as:
- a client database,
- work processes,
- technical knowledge,
- a concept,
- research data,
- a strategy,
- formulas and recipes,
No application or registration is required for the protection of trade secrets. However, your trade secret must meet the following three conditions:
- It must be a secret.
It means that the information is not generally known by or easily accessible to people who deal with the type of information in question. Everyday information or the experience that workers accumulate by doing their job do not constitute trade secrets.
- It must be commercially valuable.
More specifically, it means that the information has commercial value because it is secret. For example, the recipes for all types of product, such as drinks, food or paint. If they were not secret, they would have (practically) no value. Everybody could then make these products.
- You must have taken reasonable steps to maintain the confidentiality of your trade secret.
It means that you took steps to guarantee that the information remains confidential.
What measures can I take to protect my trade secret?
One of the conditions for protection by trade secrecy is to have taken reasonable steps in order to maintain the confidentiality of your trade secret.
A few examples of such measures:
- physical protection through the surveillance of the business, a safe or secured archives;
- digital protection by securing your system using passwords, encryption or a security system;
- storage of your trade secret in a digital safe, such as the BOIP's i-DEPOT;
- agreements with employees through non-competition clauses and confidentiality clauses in their employment contracts or in labour protocols;
- agreements with trade partners and new relations through confidentiality agreements.
Do not hesitate to share the information on trade secrets around you. The FPS Economy implemented a communication kit that you can use for this purpose.