hier der titel · hier der titel fleischmarkt 1 1010 wien e [email protected] w t +43 1 24 500, f +43...
TRANSCRIPT
Hier der Titel
Fleischmarkt 1
1010 Wien
W www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
BUSINESS AND TRADE SECRETS (EU)
BARBARA KUCHAR attorney at law
PTMG Warsaw October 1st, 2015
Business and Trade Secrets in the EU
Introduction – conflicting views on the new regime Comparative summary of the current situation in the EU Current legislative process, proposed Trade Secrets
Directive and amendments by the EU Parliament Expected changes for trade secret owners Measures for the protection of trade secrets Clinical Data and Trade Secrets New Clinical Trials Regulation European Medicines Agency’s clinical data disclosure policy CCI (commercially confidential information) Outlook
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Business and Trade Secrets in the EU
Conflicting interests: “Companies, inventors, researchers and creators will be put on equal footing throughout the Internal Market, and the EU will have a common, clear and balanced legal framework which will discourage unfair competition, and facilitate collaborative innovation and the sharing of valuable know-how to make the EU a stronger and more competitive economic region“ (EU Commission)
versus “EU trade secrets directive is a threat to health, environment, free speech and worker mobility”
(Corporate Europe Observatory (CEO))
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Business and Trade Secrets in the EU
Reaction of the EU Commission:
„Will the draft directive have any impact on the freedom of expression and the right to information? No. Journalists will remain free to investigate and publish news on companies’ practices and business affairs, as they are today.“ „Will companies be able to hide information on matters of public interest, such as public health, the environment or the safety of consumers? No. The draft directive does not alter the current legal obligations on companies to divulge information for such public policy objectives.“
(http://ec.europa.eu/growth/industry/intellectual-property/trade-secrets/index_en.htm)
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
Common benchmark for the protection of trade secrets:
Article 39.2 of TRIPS (1st January 1995*):
Information that is secret and
has a commercial value because it is secret and
has been subject to reasonable steps to keep it secret.
Undisclosed test data which have to be submitted for obtaining marketing approval must be protected against unfair commercial use (Article 39.3 TRIPS).
*Pursuant to Council Decision 94/800/EC, all Member States, as well as the
EU itself, are bound by it.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
Study on Trade Secrets and Confidential Business Information in the Internal Market compiled for the European Commission by Baker & McKenzie (April 2013): 140 out of 537 companies (26 %) reported attempts at or
acts of misappropriation; Only 57 companies (41 %) sought remedies in EU courts; Primarily responsible for misappropriation: competitors
(53%), former employees (45%) and customers (31%); Generally industrial espionage is a matter of special
concern in the pharmaceutical industries.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
2013 Study demonstrated many differences:
Sweden is the only EU country with a specific legal framework;
Austria, Germany, Poland and Spain protection by unfair competition law;
France, Italy and Portugal protection by codes of industrial property;
Netherlands, Luxemburg protection by tort law;
UK and Ireland protection by common law.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
Enforcement – significant different legal protection, e.g.
Bulgaria, Cyprus, Estonia, Finland, Luxemburg and Malta only injunctions and damages are available but no return/destruction/withdrawal/seizure of infringing goods;
Austria, the Czech Republic, Denmark, Estonia, Finland, Germany, the Republic of Ireland, Latvia, Lithuania and Portugal remedies are available regardless of the recipient’s good or bad faith;
Italy, Slovak Republic and to a certain extent Portugal and Romania applicability of Enforcement Directive to trade secrets.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
Enforcement (ctd)
Ex parte search orders and remedies such as orders to seize/return/withdraw from the market/destroy secret information or goods embedding the secret information are not available in many jurisdictions;
Plaintiff has a high burden of proof to demonstrate the infringement;
Only in some countries such as Hungary, Austria, Germany and the United Kingdom disclosure of secrets during civil proceedings can be prevented.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current situation in the EU
Findings of 2013 Study :
No uniform definition of "trade secrets” within the EU exists;
Different eligibility standards for qualification as trade secrets have been established;
Level of protection of trade secrets among different jurisdictions is inconsistent;
Trade secret case law is very limited throughout Europe and cross-border litigation is non-existent.
There is sufficient economic justification for harmonization of trade secrets protection.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process
First draft of a new Trade Secrets Directive was proposed by the EU Commission in November 2013;
Common Approach Agreement on the text was reached by the Council of the European Union on 26 May 2014;
European Economic and Social Committee rendered a favourable report to the draft directive;
European Parliament issued a report of the judicial committee on 22 June 2015 with considerable amendments;
First reading in plenary of European Parliament is scheduled on 24 November 2015.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Main features:
Minimum harmonisation of the different civil law regimes; Establishment of common principles and definitions and of
measures, procedures and remedies available for the purpose of civil law redress;
Unlawful use and acquisition of trade secrets by third parties;
Preservation of confidentiality in legal proceedings; Liability exemptions for employees if acting without intent.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Definition: A trade secret means information which is secret in the sense that it is not, as a body or in the
precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question;
has commercial value because it is secret; has been subject to reasonable steps under the
circumstances, by the person lawfully in control of the information, to keep it secret.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Unlawful acquisition, use or disclosure of a trade secret (intentional or with gross negligence): Unauthorised access to or copy of any documents,
objects, materials, substances or electronic files, lawfully under the control of the trade secret holder;
Theft; bribery; deception; Breach of a confidentiality agreement or any other duty to
maintain secrecy; Any other conduct which is contrary to honest commercial
practices.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
The use or disclosure of a trade secret shall also be unlawful, whenever a person at the time of use or disclosure, knew or should have known that the trade secret was obtained from another person who acted unlawfully.
Unlawful use of a trade secret: The conscious and deliberate production, offering or placing on the market of infringing goods, or import, export or storage of infringing goods for those purposes.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Lawful acquisition, use and disclosure of a trade secret: Independent discovery or creation; Reverse Engineering: observation, study, disassembly or
testing of a product or object available to the public or lawfully in the possession of the acquirer who is free from any legally valid duty to limit the acquisition of the trade secret;
Exercise of workers right to information and consultation in accordance with Union and national law and/or practices;
Any other action which is in accordance with honest commercial practices.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
No right to redress for trade secret owners if a trade secret was acquired, used or disclosed for the following purposes:
Exercising the right to freedom of expression and information (EU Charter of Fundamental Rights);
Revealing a misconduct, wrongdoing, fraud or illegal activity, provided the action was committed in the public interest;
Disclosure by workers to their representatives;
Fulfilling a non-contractual obligation;
Protecting a legitimate interest.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Following interim measures shall be available:
Cessation of or, as the case may be, the prohibition of the use or disclosure of the trade secret on an interim basis;
Prohibition to produce, offer, place on the market or use infringing goods, or import, export or store infringing goods for those purposes;
Seizure or delivery of the suspected infringing goods, including imported goods, in order to prevent their entry into or circulation within the market.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Following final remedies shall be available:
Cessation of or the prohibition of the use or disclosure of the trade secret;
Prohibition to produce, offer, place on the market or use infringing goods, or import, export or store infringing goods for those purposes;
Adoption of the appropriate corrective measures with regard to the infringing goods.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Corrective measures with regard to infringing goods: declaration of infringement; recall of the infringing goods from the market; depriving the infringing goods of their infringing quality; destruction of the infringing goods or their withdrawal
from the market; destruction of all or part of any document, object,
material, substance or electronic file containing or implementing the trade secret or delivery up to the trade secret holder of all or part of those documents, objects, materials, substances and electronic files.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Damages and publication of judicial decision: When setting the damages, the competent judicial authorities
shall take into account all appropriate factors, such as the negative economic consequences, including lost profits, which the injured party has suffered, any unfair profits made by the infringer and, in appropriate cases, elements other than economic factors, such as the moral prejudice caused to the trade secret holder by the unlawful acquisition, use or disclosure of the trade secret.
Appropriate measures for the dissemination of the information concerning the decision shall be provided.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Protection of trade secrets in court proceedings
It has to be ensured that
the parties, their legal representatives,
court officials, witnesses, experts and
any other person participating in the legal proceedings or
who has access to documents which form part of those legal proceedings
shall not be permitted to use or disclose any trade secret or alleged trade secret of which they have become aware as a result of such participation or access.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Contents of the Trade Secrets Directive
Protection of trade secrets in court proceedings: Restriction of access to any document containing trade
secrets and to hearings, when trade secrets may be disclosed, and their records or transcript;
In exceptional circumstances, restriction of parties’ access to hearings which shall be carried out only in the presence of the legal representatives and authorised experts subject to their confidentiality obligations;
Make available a non-confidential version of any judicial decision, without passages containing trade secrets.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process - amendments
Report of the EU Parliament's judicial committee (June 16, 2015) suggested considerable changes to the original text which yet need to be agreed by the EU Parliament and the Council:
Background for the amendments:
Protection for the fundamental freedom of expression and information rights of journalists;
Guarantee of workers’ professional mobility;
Provide adequate protection for whistle-blowers.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process - amendments
Amendments to the definition of trade secrets:
Addition of „business information…” after know-how:
The new definition reads as follows: ‘trade secret’ means undisclosed know-how and business
information…….. Commercial value alone shall not be sufficient:
A trade secret shall have actual or potential significant commercial value because it is secret and because its disclosure would be significantly detrimental to the legitimate economic interest of the person lawfully controlling it.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process - amendments
Amendments to the definition of trade secrets:
Also the third part of the requirements has been expanded: The owner of the trade secret has to demonstrate and verify that and how he has taken steps to keep the information confidential:
The trade secret has been …. subject to reasonable and demonstrable steps by the person lawfully in control of the information to keep it secret, through means (including technical and contractual) that can be verifiable by the relevant competent judicial authorities.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process - amendments
Further amendments :
Holder of the trade secret shall be a registered market operator legally established as being in control of the trade secret;
Unlawful use of a trade secret shall require intent, gross negligent acts would not qualify as misappropriation;
Burden of proof: the trade secret holder has the burden of proving that the trade secret was unlawfully acquired;
Claims for infringements of the new trade secrets rules would need to be brought within three (instead of 1-2) years.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Current legislative process - amendments
Amendments regarding employees’ liability and their skills and knowledge:
Member States should restrict liability for damages of employees, when they act without intent (including post-termination of employment).
Experience and skills honestly acquired by employees in the normal course of their employment shall not be considered a trade secret.
Obligations of contracts and other actions that may limit use of such knowledge have to comply with the principle of proportionality.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Expected changes for trade secrets owners
Subject to final wording of the Directive: Owners of trade secrets will have increased obligations
to provide evidence that they have established adequate measures for the protection of trade secrets;
It will not be sufficient any longer that the mere intention to keep information secret will qualify for protection, even if such intention is apparent to a third party or an average employee from the circumstances.
In preparation for the legal framework it is recommended to introduce measures now in order to have them in place for relying upon in proceedings.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Measures for the protection of trade secrets
Identify and classify trade secrets (“Trade Secrets Audit”); Establish a Trade Secrets Protection Policy in writing (also
for later demonstration in court proceedings); Inform and train all employees about the policy and their
confidentiality obligations; Restrict access to trade secrets to “need to know”
employees; monitor and maintain records about access to trade secrets; mark documents as “confidential”;
Pre approve employee speeches and publications, pay attention to secret information potentially disclosed during trade shows;
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Measures for the protection of trade secrets (ctd.)
Segregate confidential information physically and electronically;
Develop and maintain a strict computer secrecy policy (passwords, encryption, privacy filters for monitors) – include computer professionals;
Introduce locked waste bins (cleaning personnel); Generally restrict access to the company from outside; Review, update and enter into confidentiality agreements
with business partners; Implement a periodic review of trade secret assets and the
protection plan.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Measures for the protection of trade secrets (ctd.)
Screen new employees as far as legally admissible;
Have employees sign agreements containing the following clauses (if compliant with national labour law):
acknowledge that they have access to trade secrets;
the company is sufficiently protecting that information;
they will not and have not disclosed or misappropriated this information and
they will report to the company all unauthorized disclosures or uses of the trade secrets information.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Measures for the protection of trade secrets (ctd.)
Make exit interviews together with a second company
executive (witness), take minutes, remind employees of on going obligations and have them signed a confirmation containing the following clauses (if compliant with national labour law): they will not and have not disclosed or misappropriated
this information, they will further on keep the information secret, they acknowledge that they are not authorized to
disclose such information to their new employer, they are aware that all misappropriations will be
pursued.
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Clinical data and trade secrets
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Balance between transparency and confidentiality in the conduct of clinical trials: Clinical Trials Regulation EU No 536/2014 (comes into force
on May 28, 2016) will be setting new standards on transparency for clinical trials conducted in the EU.
All information submitted in the clinical trials application and during assessment shall be in principle publically accessible unless the confidentiality of the information can be justified on grounds such as protection of commercially confidential information.
European Medicines Agency (EMA)
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Since January 1, 2015 EMA can disclose clinical data in the EU as follows:
On the basis of both its publication of clinical data policy and its access to unpublished documents policy or
On the basis of voluntary commitments based on industry policies.
When the Clinical Trials Regulation enters into effect, such voluntary commitments will, in some circumstances, become a legal obligation.
European Medicines Agency (EMA)
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
The implementation of the policy will be undertaken in a stepwise manner:
In a first phase, the publication of clinical data will relate to clinical reports only.
In a second phase, the EMA will review various aspects in relation to IPD (individual patient data).
Protecting commercially confidential information (CCI): “The Agency respects and will not divulge CCI. In general,
however, clinical data cannot be considered CCI. The Agency acknowledges that there are limited circumstances
where information could constitute CCI.”
EMA’s clinical data disclosure policy
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Commercially confidential information (CCI): CCI shall mean any information contained in the clinical
report submitted to the EMA that is not in the public domain or publicly available and where disclosure may undermine the legitimate economic interest of the applicant.
CCI falls broadly into two categories: trade secrets (including formulas, programs, process or information contained or embodied in a product, etc.) and commercial confidences.
EMA’s clinical data disclosure policy
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Relevant EMA documents:
Guidance to pharmaceutical industry on redacting commercially confidential information (CCI) in clinical reports (June 24, 2015): http://www.ema.europa.eu/docs/en_GB/document_library/Presentation/2015/06/WC500188857.pdf
Policy on publication of clinical data for medicinal products for human use (Policy 0070, October 2, 2014): http://www.ema.europa.eu/docs/en_GB/document_library/Other/2014/10/WC500174796.pdf
Outlook: balance between transparency and confidentiality
Fleischmarkt 1
A-1010 Vienna
W: www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
The European Federation of Pharmaceutical Industries and Associations (EFPIA) and its member companies are fully committed, under the Joint EFPIA/PhRMA Principles, for Responsible Clinical Trial Data Sharing;
Confidential commercial information (CCI) and individual patient data (IPD) will be excluded from transparency;
EU Commission: Trade Secrets Directive cannot be used as withdrawal from commitments and obligations of transparency and data sharing.
Hier der Titel
Fleischmarkt 1
1010 Wien
W www.kwr.at
T +43 1 24 500, F +43 1 24500 63999
Thank you for your attention!
BARBARA KUCHAR