The Official State Bulletin has published in its edition of February 21, the Law 1/2019 of February 20th, on Trade Secrets, which will enter into force by March 13th, 2019.
In this way, it is transposed the Directive EU 2016/943 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, which had to be incorporated into local law since June 9th, 2018.
This new Law, adapted to the case law of the European Court of Justice (ECJ), gives more protection to companies against the unlawful appropriation of its trade secrets, which had been protected so far by residual articles of the Criminal Code, the Unfair Competition Code and contractual clauses.
This new legislation defines the objective of protection in line with the concept included within the TTBER (European Regulation 316/2014 on the application of Article 101(3) of the Treaty on the Functioning of the European Union to categories of technology transfer agreements), requiring that the information is (i) "unknown" by those persons close to the sphere in which the information is used, so it is excluded from its scope the general or not relevant information, (ii) that owns a "business value" due to its secret nature; and (iii) that owns "reasonable measures" in order to keep it secret.
The definition confirms that this protection cannot affect the right to the collective negotiation nor the free mobility of employees, specifying that it is not considered as a trade secret the experience and the aptitudes acquired by an employee in his/her entire career.
Furthermore, this Law differentiates between two types of conducts; on one hand, those in which the obtaining and use of trade secrets is lawful (i.e. exercising the right of freedom of expression and information, the discovery of an illegality of general interest, the disclosure of employees when it is necessary for exercising their functions or other legitimate interest) and, on the other hand, those conducts considered as a violation of trade secrets in which the obtaining of the same has been made without authorization of the holder or through appropriation, non-authorized copy or other unfair activity. In order to face the latter, new procedural measures have been established as those set up in the Patent Code, allowing the right-holder to ask for judiciary inquiries, interim measures and cease and compensation actions. The prescription period to take any action is three (3) years from the moment in which the violation has been known.
Among the main modifications, it is also important to mention the regulation of the trade secret as a property subject, as it may be transferred or licensed, considering its economic scope. It is also regulated the co-ownership regime of a trade secret.
Finally, there are procedural modifications that affect the possible existence and/or management of trade secrets in judiciary proceedings; in order to do so, there are mechanisms to access "proof sources", with the aim of proving the facts alleged; there are stipulations referring the "precautionary custody", with the aim of avoiding the disappearance of the trade secret.
The previous (limited) legislation on trade secrets, that was established in article 13 of the Law 3/1991 on Unfair Competition, is still valid, but adapted to this new Law, which will enter into force by March 13th, 2019.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
