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New Business Secrets Act: What Now?

| News | Litigation

José Martínez discusses, for El Economista CV, the measures that must be taken after the approval of the new Business Secrets Act

With the approval of Law 1/2019 last February, on Business Secrets, transposing Directive 2016/943 of the European Parliament and of the Council, of 8 June 2016, volumes have been written to explain the legal regime that the new Law establishes.

And that’s no surprise, because trade secrets -which suppose in certain sectors of economic activity an asset that offers a real added value to the company over the rest of the competition-, were enveloped in an aura of insecurity by the brief regulation of the old article 13 of the Law of Unfair Competition, and by the absence of absolute homogeneity in its regulation in the different countries of the European Union.

Although in the second it is more complex to move forward because the harmonisation of the national legislations of the Member States is not an easy task, in the first there is no doubt that -with greater or lesser success of the legislator- the new regulation is quite complete and contributes to the purpose of establishing secure guidelines for the correct identification of business secrets and the establishment of an ad hoc judicial procedure to request in Spain the effective legal protection of the knowledge or information in question.

But as an unavoidable prerequisite for requesting such legal protection, the Law reminds us that the owner of that secret must have previously adopted the protection measures that were reasonably within his reach, given the relevance of the secret for their company: there is no reason to stand idly by waiting for the violation of the secret and then argue before the Courts and Tribunals that its relevance was maximum.

Regarding the unquestionable certainty of the necessary activity of the businessman in the protection of the secret through the adoption of measures to that effect, it is worth asking: what should the businessperson do?

The answer to this question will depend, as anticipated, on the genuine importance or relevance of secrecy for the company, and obviously, on whether such knowledge or information is really secret in the sense - as indicated by the Law - that "as a whole or in the precise configuration and assembly of its components, it is not generally known by persons belonging to circles in which the type of information or knowledge in question is normally used, nor easily accessible to them".

Devoting resources to supposedly keeping secret what is generally known in a sector of activity, or easily ascertainable, will be useless from the legal point of view.

Therefore, the first thing is to carry out an analysis with respect to which supposed knowledge or information of those that are in the credit of the company are invested with a certain significance for the operation of the company.

Next, it will be necessary to evaluate the general knowledge that, due to the nature of the knowledge or information, or due to the sector of activity, third parties may have of its applicability to the specific process of the company on which it falls.

Thirdly, to identify concretely and fully the benefit, actual or potential, that this secret grants to the company.

Once this triple assessment has been carried out, the employer must adopt the measures that are reasonable, in accordance with it, to try to preserve the information or knowledge as secret.

To this end, it will be necessary to draw up a sort of risk map, in the style and use of Corporate Compliance techniques, in order to identify all possible ways in which, either immediately or immediately, directly or indirectly, a third party from the competition can obtain or be revealed the secret.

Once the previous steps have been carried out, a wide range of possible specific actions to be implemented in order to preserve knowledge or information as a secret are opened. Depending on the vicissitudes, needs and possibilities of each company, these will be reflected in labour, statutory, organisational, productive and commercial aspects.

One of the first measures that is recurrently used, and which is usually no less relevant, is the signing of confidentiality agreements, both with suppliers of products and services, and with customers, but also with workers.

In the case of workers, caution must be exercised, since the Law provides that the alleged violation of trade secrets "may not serve as a basis for justifying limitations on the use by workers of experience and skills acquired honestly during the normal course of their professional career or of information that does not meet all the requirements of trade secrets, nor for imposing on employment contracts restrictions not provided for by law".

But as we have just pointed out, there is a wide range of possible measures that only after the study of the details of the company, the sector in which it is located, and the substantiality of the secret, will be diligent to move the entrepreneur, conveniently separating the wheat from the tares.

You can see the article in El Economista suplemento CV

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