FUNDAMENTAL LEGAL ISSUES OF TRADE SECRET IN INTELLECTUAL PROPERTY RIGHT
1. What is trade secret.
Trade secret means information obtained from activities of financial or intellectual investment, which has not yet been disclosed and which is able to be used in business. Trade secret is subject matter of intellectual property concluded in Article 3.2 Law on Intellectual property 2005. More specific, trade secret is the subject matter of industrial property rights.
2. Conditions for protection of trade secret.
Not every trade secret is protected unless it meets several conditions concluded in Article 84 section 7 Law on intellectual property 2005.
A trade secret shall be eligible for protection when it satisfies the following conditions:
1. It is neither common knowledge nor easily obtainable.
2. When used in business activities, the trade secret will create for its holder advantages over those who do not hold or use it.
3. The owner of the trade secret maintains its secrecy by necessary means so that the secret will not be disclosed nor be easily accessible.
An easier way to understand is trade secret doesn’t need to be something that’s unique but it has to be special that barely no one with an ordinary mind can understand and come up with that. The special can come from the complexity of the intellectual property, for instance the knowledge which is published to the community such as knowledge on some famous sites or textbook, newspaper, those kind of knowledge will not be protected.
A paramount rule in this matter is the trade secret must associate with business, it means that the trade secret must help its owner to possess the absolute advantages among others while they don’t have this secret in business and create interest. Finally, trade secret must be protected extremely careful and the owners of the property must prove that they have done literally every method to protect this property to the best of their ability so that the property is not stolen. This is an important term because if the related matter is brought to court then the burden is on the complainant they must proof that no matter how hard they try to protect the property they couldn’t stop it from being stolen.
Such regulations are required in order to avoid unnecessary dispute related to this matter.
Equivalent to the conditions for the trade secret to be eligible for protection, the Law on intellectual property also conclude objects ineligible for protection as trade secret under the Article 85.
“1. Personal identification secrets.
2. State management secrets.
3. National defence and security secrets.
4. Other confidential information unrelated to business.”
3. Which method that corporate or individual can use to protect their intellectual property?
3.1. Self protection
A glance at those massive food industries corporate which have been growing too fast thanks to the unique trade secret we can obviously see the tangible evidence in Coca Cola, KFC, Lotteria or Mc Donald…All giant corporates use a very stringent and high-security method to protect their recipe for the products but there is one thing that they have in common and that is they all use the self protection.
This kind of self protection, according to Vietnamese law is concluded in Article 198, Chapter XVI: General provision on protection of the intellectual rights Law on intellectual property 2005 as a paramount right for their self-protection of intellectual property including:
- To apply technological measures to prevent acts of infringement of its intellectual property rights;
- To request any organization or individual who commits an act of infringement of the intellectual property rights of the holder to terminate such act, make a public apology or rectification, and pay damages;
- To request the competent State body to deal with acts of infringement of its intellectual property rights in accordance with the provisions of this Law and other relevant laws;
- To initiate a lawsuit at a court or a claim at an arbitration centre to protect the legitimate rights and interests of the holder.
Besides, the owners of trade secret can also request an authorized body to apply the civil regulations or administrative regulations if there is any violation of the competition in the Competition Law 2018. If the violation of trade secret consists enough the exempt for crime, that conduct could be regulated by Criminal Code 2015.
3.2. Register for inventions.
Until now, there hasn’t been any regulation on the registration for the subject matter of the intellectual property which is trade secret so beside the self-protection method, the owners of the trade secret can protect their trade secret through the registration of an invention patent
However, register in the name of inventions will always have disadvantages.
Firstly, in Vietnam, the registration for inventions can bring immense hardship because the intellectual property must never be invented before, It means that the invention must be absolutely brand new and contains high creativity.
Secondly, the invention patent will always have a specified period and the owners also have to pay for the continuation of the validity of the patent. In detail, in terms of the invention patent, An invention patent shall be valid from the grant date until the end of twenty (20) years after the filing date. When it comes to the utility solution patent, It shall be valid from the grant date until the end of ten (10) years after the filing date, after this period, the owners can not expand the period (following regulations in Circular 16/2016/TT-BKHCN) and of course the intellectual property will not be protected anymore. This is a significant disadvantage when a corporate or an individual has a desire to promote the trade secret for long term business ( Article 93.2,93.3 and Article 94.1 Law on Intellectual Property 2005 with amendment and supplement in 2009)
4. Exclusion for trade secret
In this section, the owners can not prohibit others from doing these following activities even though the owners assume that those conducts are violations of trade secret.
Those conducts are concluded under Article 125 paragraph 3 Law on Intellectual 2005.
“Owners of trade secrets shall not have the right to prevent others from performing the following acts:
(a) Disclosing or using trade secrets acquired without knowing or having the obligation to know that they were unlawfully acquired by others;
(b) Disclosing secret data in order to protect the public according to the provisions of clause 1 of article 128 of this Law;
(c) Using secret data stipulated in article 128 of this Law not for commercial purposes;
(d) Disclosing or using trade secrets obtained independently;
(dd) Disclosing or using trade secrets obtained by analyzing or evaluating lawfully distributed products, unless otherwise agreed upon by analyzers or evaluators and owners of such trade secrets or sellers of such products.”
Above are notes for individuals and companies who want to protect their trade secret, during the operating of this right if the owners have any questions of difficulty please contact us, it’s a pleasure for DTD to give consultation.
