Non-public ideas, knowledge, information and data. The protection of trade secrets relates to the protection of undisclosed information. The term ‘information’ is used here in its common sense meaning and encompasses ideas, knowledge, information and data. This may include all manner of secrets, such as marketing and market information (for example, customer lists and pricing information) and technical ideas and knowledge (such as formulations).
Protective measures. For information to be protected as a trade secret, it is necessary that the information (i) is not generally or readily accessible within the circles dealing with that information, (ii) possesses commercial value because it is secret, and (iii) reasonable protective measures have been taken to safeguard that secrecy. In practice, these measures consist of confidentiality agreements with employees and suppliers, and the physical safeguarding of the relevant information and data through physical barriers and the implementation of access authorisations and restrictions for information systems in which those secrets are stored.
Protection afforded. Trade secrets are something of an oddity within IP law, as they do not confer an absolute exclusive right of exploitation. The right holder cannot take action against every instance of a third party’s use of the trade secret, but can, as a rule, only take action where a third party unlawfully gains access to a trade secret and subsequently uses or discloses that trade secret. Trade secrets are therefore protected in particular against ‘intrusion’ by third parties ‘in breach of fair trading practices’. This includes, for example, bribing individuals who have access to a trade secret or otherwise undermining the network of contractual obligations or security measures designed to safeguard a trade secret.
Duration. A trade secret enjoys protection (i) because it is secret and (ii) for as long as it remains secret. The duration of that protection may therefore be unlimited in time, but it may also be of only short duration.
Alternative to a patent. For business processes and other ideas, knowledge, information and data that can actually be kept secret whilst the products or services created using them are being exploited, protection as a trade secret may be an economically attractive alternative to patent protection, as a patent offers protection for a maximum of 20 years and ‘the trade secret’ must be fully disclosed in a patent application. These disadvantages do not apply to a trade secret.
Internationally. The obligation to protect trade secrets is an international obligation, laid down in Article 39 of the TRIPS Agreement and the 2016 European Trade Secrets Directive.