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New UK trade secrets laws imminent

New trade secrets laws are scheduled to be published by the UK government before the end of this month.16 May 2018

In a statement issued alongside the publication of its response (20-page / 376KB PDF) to a consultation exercise it held on draft trade secrets regulations earlier this year, the government said that it intends to bring forward finalised regulations to implement the EU's Trade Secrets Directive "in May 2018".

In the response paper, the Intellectual Property Office (IPO) confirmed that it would revise the draft regulations in an effort to clarify points raised by consultation respondents, including in relation to some of the definitions proposed under the new rules, the time limits for lodging a legal challenge in respect of trade secrets, and the confidentiality of trade secrets in court proceedings.

The Trade Secrets Directive was introduced by EU law makers as a means of trying to harmonise the existing patchwork protection that applies to trade secrets across the EU and came into force in 2016. It has to be implemented into national laws by 9 June 2018.

The UK government previously confirmed that it would copy the definition of a trade secret from the Directive into the UK regulations implementing the EU law.

Under the Directive, a trade secret is considered to be information that is secret, has commercial value because it is secret and has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret. Information is only considered secret if it is "not … generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question".

The Directive includes rules that protect businesses against the unlawful acquisition, use and disclosure of their trade secrets, including in respect of second-hand sharing of that information. However, there are protections built into the Directive, and within existing UK laws, that permit the acquisition of trade secrets through, for example, reverse engineering.

Zara Early, an intellectual property law expert at Pinsent Masons, the law firm behind Out-Law.com, said: "It was argued in the consultation that the draft regulations seek to implement protections that are already available to trade secret holders in the UK, whether under current UK laws or at the discretion of the UK courts. Nevertheless, the IPO’s response provides a welcome clarification."

"It demonstrates a desire for transparency and a cohesiveness in the UK’s approach to trade secrets procedure, while enabling UK jurisdictions to remain consistent with other EU member states, as required by the Directive, and the international trend towards increasing the protection of trade secrets. This approach should be beneficial to both UK-based trade secret holders and law makers post-Brexit," she said.