Trade secret protection: taking precautions is key

Recent years have seen infringements upon the trade secrets of many high-tech companies. Usually it happens like this: one or more key technicians steal the core technology from their employer and establish a new entity that produces and sells competitive products at lower prices.

In some cases, the infringement also involves salespeople or IT technicians of the employer. Seeking trade secret protection has been a challenge in China owing to the difficulty in defeating infringements and the heavy burden to prove trade secret infringements under existing PRC legislation for civil and criminal proceedings. Many have been exploring better solutions for trade secret protection.

Given the calls for intellectual property (IP) protection, both from domestic companies and the international community, China not only attaches more importance to IP protection at the macro-policy level, but also reflects its growing emphasis on trade secret protection through legislation. The General Principles of the Civil Law, effective on 1 October 2017, and the Anti-Unfair Competition Law, effective on 1 January 2018, contain provisions specifically designed for trade secret protection.

Frank Liu is a partner at TianTai Law Firm