Trade Secrets basics - UK

   Definition of a trade secret

Defined under Regulation 2, Trade Secrets (Enforcement etc) Regulations 2018 (SI 2018/597) in force from 9 June 2018, implementing the Trade Secrets Directive ((EU) 2016/943) on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure) to the extent that UK law did not already cover this.

A "trade secret" means Information which:

• (a) is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among, or readily accessible to, persons within the circles that normally deal with the kind of information in question,
• (b) has commercial value because it is secret, and
• (c) has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret.

   Requirements to qualify for protection

Must meet the statutory definition above and show that reasonable steps have been taken to keep the information secret. (Regulation 2, Trade Secrets Regulations 2018). 

   Protection Mechanism

Provides a statutory framework supplementing common law. Requires proof of reasonable steps taken to protect the trade secret. (Regulation 3, Trade Secrets Regulations 2018).

If the information qualifies as a trade secret under the above definition it is protected against unlawful acquisition, use or disclosure of the information (burden of proof is on the claimant).   See Regulation 3(1): The acquisition, use or disclosure of a trade secret is unlawful where the acquisition, use or disclosure constitutes a breach of confidence in confidential information).

   Remedies

Injunctions, protective measures (e.g. recall, delivery-up and destruction, or adaptation, of infringing goods), compensation (limited to the royalties or fees that would have been payable for a licence and to where an injunction is disproportionate and compensation is satisfactory alternative), and damages. (Regulations 14-17, Trade Secrets (Regulations 2018).

NB remedies available under breach of confidence (common law) are also available to trade secret owners where these are wider than those available under the Regulations, either in addition or in the alternative. Regulation 3(2) provides:

• A trade secret holder may apply for and a court may grant measures, procedures, and remedies available in an action for breach of confidence where the measures, procedures and remedies – 
  • (a) provide wider protection to the trade secret holder than that provided under these Regulations in respect of the unlawful acquisition, use or disclosure of a trade secret, and
  • (b) comply with the safeguards referred to in Article 1 of the Trade Secrets Directive.

   Confidentiality in Proceedings

Regulation 10 ensures confidentiality during and after proceedings, with measures to restrict access to documents and hearings. (Regulation 10, Trade Secrets Regulations 2018).

   Limitation Period

Six years from the later of the cessation of unlawful activity or when the trade secret holder knew or should have known of the infringement. (Regulations 4-9, Trade Secrets Regulations 2018).