On 31 December 2020, the Brexit transition period comes to an end, and significant changes to the law in the UK will take effect.
For trade secrets and the law in relation to confidential information, there are some important soundbites for businesses to be aware of - some of which you may already have heard about, while others may be news outside the UK (even for experienced trade secrets lawyers):
- English law protecting against the
misuse of confidential information, including trade secrets, has
evolved in the tradition of the common law, which has long been
considered to be compliant with the country's obligations under
the TRIPS Agreement with respect to legal protection for
"undisclosed information". The tort of breach of
confidence protects information which has the "necessary
quality of confidence", is communicated in circumstances
importing an obligation of confidence, and is used (or threatened
to be used) in an unauthorised way to the detriment of the owner
(Coco v A. N. Clark [1969] RPC 41, Attorney-General v
Guardian Newspapers (No 2) [1990] 1 AC 109).
- The first English legislation to
address protection for confidential information came into force in
2018, in order to implement the first EU legislation in this area
(The Trade Secrets Directive). Recent case law from the High Court
suggests that the common law principles are unaffected
(Trailfinders v TCL [2020] EWHC 591 (IPEC), Shenzhen
Senior v Celgard [2020] EWCA Civ 1293).
- The application of settled principles
of English law protecting confidential information and trade
secrets therefore continues. A recent example is the Shenzhen v
Celgard case, in which Court of Appeal confirmed the award of
an interim injunction to restrain importation into and sale in the
UK by a Chinese manufacturer ('Senior') of separators used
in lithium-ion batteries. Celgard alleged that the goods concerned
had been developed in China after a former employee of Celgard in
the USA, who had had access to valuable trade secrets regarding
Celgard's battery separator materials, joined Senior in China
and disclosed Celgard's trade secrets to Senior.
- The national nature of the legal
protection for trade secrets in the UK means that the 31 December
2020 Brexit transition will not impact trade secrets protection in
the UK. Additionally, as a signatory to the Hague Convention on
Choice of Court Agreements, the UK courts will continue to
recognise and give effect to exclusive jurisdiction clauses,
including those conferring jurisdiction on the courts in the UK in
respect of trade secrets.
- It will remain the case that all
businesses, and particularly those that utilise confidentiality as
a significant means to protect valuable proprietary information,
should continue to maintain and update their trade secrets policies
and procedures on a periodic basis, including reviewing technical
security measures that are in place to protect trade secrets,
particularly from cyber-based threats.
- Unless agreement is reached to replace (in respect of the UK) the "Brussels" and "Lugano" regimes on jurisdiction and enforcement of judgments in the EU and the EEA, in the UK the common law will govern such issues from 1 January 2021. The common law already governs such issues as between the courts in the UK and the courts in the US and Canada. The transition presents some opportunities for well-informed potential litigants.
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