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EU trade secrets directive – Council’s changes generally good for business (with one important caveat)

  1. The Council proposes a six–year limitation period on suing over trade secrets. The Commission had proposed two years. 
  2. The Council’s version clarifies that national laws may provide greater protection for trade secrets than that set out in the directive. 
  3. The Commission’s draft required a trade secret holder to show that an alleged infringer had acted ‘intentionally’ or with ‘gross negligence’. The Council has removed this requirement. It should therefore be easier to prove infringement. 

The Commission’s draft said that those who learn about another’s secret information during litigation could not use it after the trial. It also said that the court could restrict who had access to secret information during the trial. This was probably the most important advance in the original proposal, when compared with existing national regimes. The protections proposed would hugely benefit businesses that want to sue to protect their secrets but worry about information being revealed in court. The Council’s version contains carve-outs from those protections. It says: 

(a) a trade secret owner must submit a ‘duly reasoned application’ to the court, showing that its information is secret and should not be used after trial; and 

(b) at least one person from each party must have full access to the confidential information during the trial.