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What is know-how? What are trade secrets?

There is no common definition of what are considered know-how or trade secrets. However, all definitions have the following three components in common, pointing to the fact that these:

  • are not generally known to the public;
  • confer economic benefit on its holder because the information is not publicly known; and
  • are the subject of reasonable efforts by the holder to maintain its secrecy.

The European Trade Secrets Directive

On 8 June 2016 following a proposal from the European Commission, the European Parliament and the Council adopted a Directive that aims to standardise the national laws in EU countries against the unlawful acquisition, disclosure and use of trade secrets.

The Directive harmonises the definition of trade secrets in accordance with existing internationally binding standards. It also defines the relevant forms of misappropriation and clarifies that reverse engineering and parallel innovation must be guaranteed, given that trade secrets are not a form of exclusive intellectual property right.

Without establishing criminal sanctions, the proposal harmonises the civil means through which victims of trade secret misappropriation can seek protection, such as:

  • stopping the unlawful use and further disclosure of misappropriated trade secrets
  • the removal from the market of goods that have been manufactured on the basis of a trade secret that has been illegally acquired
  • the right to compensation for the damages caused by the unlawful use or disclosure of the misappropriated trade secret.

Which measures can you take in order to protect trade secrets / know-how?

There are a wide variety of efforts you can undertake to protect trade secrets. Depending on the actual object, your organisation and the tools available to you, these efforts could include:

  • putting in place confidentiality / non-disclosure obligations;
  • limit the access to the know-how, by putting in place logical, physical and technological barriers;
  • limit the possibility to exchange the information to third parties, or at least log whoever is entitled to have access to such information.