"Cybercrime and industrial espionage are unfortunately part of the reality that businesses in Europe face every day. We have to make sure our laws move with the times and that the strategic assets of our companies are adequately protected against theft and misuse. Protecting trade secrets is also about more than that." Commissioner for Internal Market and Services Michel Barnier, November 2013
According to an EU press release, recent studies found that one in five EU companies has suffered at least one attempt to steal its trade secrets in the last ten years; and the numbers are going up with 25% of companies reporting theft of information in 2013, up from 18% in 2012. Across Europe, companies, irrespective of their size, value their trade secrets as much as their intellectual property rights. The capacity of companies to innovate and compete can be seriously harmed when confidential information is stolen or misused. Trade secrets can be particularly important to small and medium-sized enterprises (SMEs) who often choose to protect their businesses through the use of these unregistered rights rather than go through the expense of applying for patents.
There are currently significant differences across the EU in the way in which trade secrets can be protected. Some countries rely on general torts or unfair competition law; other countries have a developed system of specific protection in place. Some countries have civil remedies whilst others criminal sanctions. The fragmented approach within the EU creates different levels of protection and redress. This makes a uniform business policy or protection measure difficult to establish for businesses operating across Europe. Enforcement is also patchy. Businesses are unsure how well their confidential information is protected in each jurisdiction. This can impact on cross-border cooperation between business and research partners and has been identified by the European Commission as a key obstacle to innovation and economic growth within the EU.
The European Commission has approved a proposal for a Directive to counter the problem of trade secret theft and provide a clear and uniform level of protection across the EU. The proposed Directive contains a new definition of trade secrets and lays down rules on protection against the unlawful acquisition, disclosure and use of trade secrets. There is also a draft provision for courts to be able to require those involved in a case not to disclose or use any trade secrets revealed in legal proceedings. Many of the provisions are already available in UK legal proceedings or effectively part of UK law through the common law. It is currently expected that the introduction of what will be statutory protection for trade secrets will see the new law running alongside the current case law.
The proposed Directive will now go to the Council of Ministers and the European Parliament for debate and adoption; the new measures are expected to be in place within three years.