CHINA Law and Practice Contributed by: Chuanhong Long, Ji Liu and Xiao Jin, CCPIT Patent and Trademark Law Office
the right-holder can sue before a Chinese court for infringement due to the infringer’s use of the trade secret. In addition, according to the princi - ple of lex personalis applied in Chinese criminal law, if the perpetrator of the misappropriation is a Chinese company or individual, even if the misappropriation occurs in another country/ region, a criminal lawsuit against the Chinese company or individual can be instigated.
it is an act of infringement of trade secrets. For employees, if there is a confidentiality agree - ment signed with the employer, the confiden - tiality obligation must be fulfilled. If there is no confidentiality agreement, the employee has a negative obligation of inaction – ie, to keep the trade secret, not to use it beyond the scope or authority, nor to disclose or allow others to use the trade secret. 2.3 Joint Ventures Based on the principle of good faith, joint ventur - ers have a negative obligation of inaction – ie, the obligation to keep each other’s trade secrets that become known during co-operation. 2.4 Industrial Espionage At present, there are no special provisions for industrial espionage in Chinese laws. Acts of stealing trade secrets are still dealt with in accordance with the Anti-Unfair Competition Law and Criminal Law. Similar to other intellec - tual property rights, remedies for trade secret infringement include damages and injunctions. 3. Preventing Trade Secret Misappropriation 3.1 Best Practices for Safeguarding Trade Secrets Regarding the best practice for protecting trade secrets, the relevant judicial interpretations give some suggestions: • requiring the signing of a confidentiality agreement or stipulating confidentiality obli - gations in the contract; • putting forward confidentiality requirements for employees, former employees, suppliers, customers, visitors, etc, who have access to and are able to obtain trade secrets, through
2. Misappropriation of Trade Secrets
2.1 The Definition of Misappropriation In China, the condition for filing a trade secret infringement lawsuit is to prove that the plaintiff is the holder or interested party (generally the licensee) of the trade secret; the alleged trade secret meets the definition of trade secret in Arti - cle 9 of the Anti-Unfair Competition Law, namely, it belongs to technical or business information not known to the public, has commercial value and been kept confidential by the right-holder by reasonable confidentiality measures; and the defendant has infringed trade secrets as stipu - lated in Article 9 of the Anti-Unfair Competition Law. For non-employees, it needs to be proven that the defendant used improper means. To file a trade secret infringement lawsuit, the right-holder does not need to prove that their trade secret has been used, but only that the defendant obtained the trade secret without per - mission. 2.2 Employee Relationships If the infringer of a trade secret is an employee who breaks the duty of confidentiality or diso - beys the right-holder’s requirement to keep trade secrets and discloses, uses or allows oth - ers to use the trade secrets in their possession,
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