Directive (EU) 2016/943 on the protection of trade secrets will be implemented in Austria by an amendment to the Federal Act against Unfair Competition (UWG) and will enter into force on 1 February 2019
With the implementation of the EU Trade Secrets Directive, the protection of trade and business secrets, a legal area that has so far only been rudimentarily developed and mainly characterised by case law, will become an essential component of Austrian competition law.
The provisions of the Trade Secrets Directive are to be implemented in Sections 26a - 26j of the Act against Unfair Competition (UWG) and are intended to provide stronger protection for trade secrets and counteract the danger of industrial espionage and betrayal of secrets.
With the implementation of the Directive, a uniform term for "trade secret" is laid down by law. Trade Secret means information, which is secret, in the sense that it is not generally known or readily accessible; 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.
Unlawful & Lawful Acquisition
The acquisition of a trade secret without the consent of the trade secret holder is unlawful if, inter alia, it is gained by unauthorised access to, appropriation of or copying of any documents or electronic files containing the trade secret or from which it can be deduced. The use or disclosure of a trade secret is considered to be unlawful where, inter alia, a person acquired the trade secret unlawfully or is, for instance, in breach of a confidentiality agreement.
The acquisition of a trade secret shall be deemed lawful when it is obtained, inter alia, by independent discovery or by the creation and appropriation through dismantling or testing of products ("reverse engineering"). The use and disclosure of trade secrets shall be considered lawful in case of whistleblowing or with respect to the functions of employee representatives.
As legal remedies, the law provides for provisional and precautionary measures by way of interim injunctions; furthermore, the seizure or delivery of suspected infringing goods shall be possible. In case of intentional behaviour the infringer shall pay damages to the trade secret holder.
Claims arising from the infringement of trade secrets are subject to a limitation period of 3 years from the date of knowledge of the infringement and the alleged infringer. In any case, such claims shall become time-barred 6 years after the act of infringement occurred.
Protection in the course of legal proceedings
Furthermore, new procedural provisions to protect the confidentiality of trade secrets in the course of legal proceedings will be established. For initiating legal proceedings, a duly substantiated application to the court which proves the existence of a trade secret and its infringement is sufficient. Upon application by a party or at the court's own initiative, the court must take measures to prevent disclosure of trade secrets which may include restricting public access to hearings and initially preventing the disclosure to the (alleged) infringer.
When does the amendment enter into force?
The draft law is to be adopted in 2018 and is expected to enter into force on 1 February 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.