Germany has recently seen the implementation of a new law with respect to trade secrets. A trade secret of an organization means the classified information that the organization has to protect from the public at large and especially from its competitors. This information is vital for the smooth functioning of the organization and its disclosure is considered detrimental to the organization. It may include prospective business activities, clientele information, employee data, research and development by the organization, information regarding the organization's association with other individuals or organizations, profit and loss statements etc.

In Germany, trade secrets were protected under the German Act of Unfair Competition Protection. However, for the implementation of the Directive (EU) 2016/943 of the European Parliament on the Protection Of Undisclosed Know-How And Business Information (Trade Secrets) Against Their Unlawful Acquisition, Use And Disclosure, Germany recently passed the Geschäftsgeheimnisgesetz (Trade Secrets Act, "Act").

This Act defines trade secrets as "any piece of information that is neither generally known nor readily accessible, subject to reasonable steps to maintain confidentiality." Not all trade secrets will now be considered Trade Secrets! For a trade secret to be protected under the Act, it has to qualify the requirements mentioned in the definition. With increased protection, comes increased responsibility on the part of companies. Now on, in case of trade secret disputes, companies seeking legal protection of their trade secrets will be required to place on record that appropriate and sufficient precautions were taken to protect the trade secrets from unlawful disclosure. The company will have to showcase that appropriate IT infrastructure has been set up for protection of the trade secrets.

The Act however, exempts whistleblowers, journalists, and other such investigators from the liability of unauthorised disclosure, if such disclosure is in the interest of the general public.

Compiled by: Adv. Sachi Kapoor | Concept & Edited by: Dr. Mohan Dewan

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