International Aspects of Trade Secrets Law
by Karen A. Magri
There is no global law of trade secrets or even a definition of what constitutes a trade secret. Moreover, unlike the case for patent, copyright, and trademark law there are no comprehensive international treaties pertaining to trade secrets. NAFTA (Art. 1711) and TRIPs (Art. 39) provide only brief attention to the topic. Prior to these agreements, Article 10bis of the Paris Convention (covering unfair competition) provided a potential source of support for international standards of trade secret protection, but the language of this provision is only poorly-suited for this purpose.
What does appear to be universally accepted is that to be protected as a trade secret, the subject matter must be kept "secret" - although there is some variation in how that term is construed. The RESTATEMENT OF TORTS provides a definition that represents a fairly good approximation of the international consensus: "As a general rule, a trade secret can be any information not commonly known in the relevant industry that is used in connection with a business to obtain a competitive advantage and the information is secret, is identifiable, and is not readily ascertainable." This general rule being stated, it is cautioned that the subject matter that can be protected as a trade secret will differ among nations, with some (e.g., the Philippines) providing no legal protection for trade secrets at all.
As the leading exporter of technology (including trade secrets) worldwide, the United States is increasingly concerned with strengthening international standards for the protection of trade secrets. The United States has been aggressive in demanding stronger trade secret protection of American technology by foreign countries. These efforts have been relatively successful: the United States prevailed in bringing intellectual property issues under the rubric of international trade and the GATT. In addition, many Asian nations have enacted new trade secret laws (often providing legal recognition of trade secrets for the first time) as a result of threats by the United States to impose trade sanctions for failing to provide adequate protection of American intellectual property within their borders.
Nonetheless, those in the American legal and business communities may find identification of the law of trade secrets in foreign jurisdictions to be elusive. As is true in the United States, legal protection of trade secrets in other nations can be derived from many diverse sources of law. For example, a cause of action for misappropriation of trade secrets may lie in contract law, tort law, unfair competition law, criminal law, and the laws governing employee/employer relations and fiduciary obligations. The amorphous nature of trade secrets law often presents a challenge, and potential pitfalls, to American businesses that seek to operate in foreign jurisdictions or enter international markets.
