By any measure, the past few weeks have been eventful in Europe. Given the number of challenges facing European lawmakers — from continued hostilities in Ukraine, to last-minute negotiations over Greek debt, to anti-terrorism measures — it’s unlikely that trade secrets protection is at the top of anyone’s agenda in Brussels or Strasbourg. Still — as we have previously reported here — the European Commission’s proposed directive to protect trade secrets remains an important item on the European Parliament’s agenda for this year. As we have argued, the proposed directive (if enacted) will substantially alter the legal landscape in Europe regarding trade secret protection and may enhance cross-border certainty within the EU by requiring all member states to provide certain minimum standards of protection for trade secrets.
Despite widespread support for the proposed directive, opposition to the proposal has now emerged. Recently, the European Public Health Alliance (“EPHA”), a coalition of public health NGOs, patient groups, health professionals, and disease groups, voiced its opposition to the directive. In a joint statement opposing the directive, EPHA argues that the current version of the proposed directive contains:
- “An unreasonably broad definition of ’trade secrets’ that enables almost anything within a company to be deemed as such”;
- “Overly-broad protection for companies, that could sue anyone who ‘unlawfully acquires, uses or discloses’ their so-called ‘trade secrets’”; and
- “Inadequate safeguards that will not ensure that EU consumers, journalists, whistleblowers, researchers and workers have reliable access to important data that is in the public interest.”
The EPHA joint statement further argues that, under the proposed directive, (1) companies in the health, environment and food safety fields could refuse compliance with transparency policies even when the public interest is at stake; (2) the right to freedom of expression and information could be seriously harmed; and (3) the mobility of EU workers could be undermined. Based on these concerns, the EPHA joint statement concludes that “this unbalanced piece of legislation would result in legal uncertainty” and that “unless radically amended by the Council and European Parliament, the proposed directive could endanger freedom of expression and information, corporate accountability, information sharing—possibly even innovation—in the EU.” Accordingly, the EPHA urges the EU Council and the European Parliament to radically amend the directive by “limiting the definition of what constitutes a trade secret and strengthening safeguards and exceptions to ensure that data in the public interest cannot be protected as trade secrets.”
As we have previously noted in this blog, many features of the proposed directive, including its definition of “trade secrets,” are similar to provisions in the Uniform Trade Secrets Act, which the majority of U.S. jurisdictions have adopted. Interestingly, in its joint statement, the EPHA observes that the text of the proposed directive “is strongly supported by multinational companies” and notes that industry coalitions in the EU and US have been lobbying for similar proposed trade secrets legislation in the U.S. Congress (which we have previously discussed in this blog). Although the U.S. Congress did not enact neither of the trade secrets bills introduced last year, trade secrets protection also remains an important item on the agenda in Congress — though, as with the proposed EU directive, the proposed U.S. trade secrets legislation also has its opposition.
It is not yet clear how much support, or opposition, the proposed EU trade secrets directive has in the European Parliament. We will continue to monitor progress of both the proposed EU directive and proposed legislation in the U.S. and will report on developments in this blog as they occur.