In the beginning of January 2019, a bill for the protection of trade secrets was submitted to the Parliament. It implements a Directive (ЕU) 2016/943 of the European parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure. The law will allow stricter pre-negotiation of engagements with key employees, and the envisaged claims will allow for more effective and timely justice in this area.

The bill highlights the following:

1. The general concept of “trade secret” is legally defined as any commercial information, know-how or technical information that is at the same time: (i) secret (not commonly known / easily accessible); and (ii) it has a commercial value because it is a secret; and (iii) the person who has control over the information has taken steps to keep her secret.

For example, a trade secret can be a production know-how, a list of clients, and more.

2. Infringer of a trade secret is any person (natural or legal) who has unlawfully acquired, used or disclosed trade secret. Therefore, it is enough if only the person has unlawfully acquired the trade secret without using it or disclosing it to anyone yet.

3. The trade secret holder has the right to bring an action before the court for the establishment of the infringement and for the award of compensation for the suffered damage; discontinue the use of trade secrets; a ban on production, placing on the market, etc. of the goods (that are subject of the infringement); destruction of objects, materials, electronic documents that contain trade secrets.

Prior to the submission of the claim or during the court proceedings, the trade secret holder may also request the court to take precautionary measures – e.g. seizure and delivery up of the suspected infringing goods; prohibiting the provision of services that are significantly influenced by trade secrets that have been unlawfully acquired, used or disclosed, etc.

4. Employees and workers are not liable for any damages resulting from the unauthorised acquisition, use or disclosure of trade secrets to their employer when they have not acted intentionally. On the contrary, when they have acted intentionally or in the event of a crime, the liability is complete and is sought by the so-called general civil action order. The provision does not concern managers / members of management / supervisory bodies of companies that are generally and, in most cases, not employees within the meaning of the Labor Code and are therefore liable for damages, regardless of the form of guilt.

What is the takeaway for the business?

Once the bill is adopted, each company shall judge what information can and is considered to be trade secret, designate it as such and implement appropriate measures in its internal rules as well as contracts with employees / management/supervisory bodies. Contractual engagements can also cover key partners and strategic clients of the company. Structuring such protection should be preceded by a detailed IP audit. Contract clauses and trade secret definitions are of great importance for the validity of the arrangements.