CHINA Trends and Developments Contributed by: Mitchell Liu (Liu Minxuan), AllBright Law Offices
1. Whether criminal cases involving trade secrets aim to resolve economic disputes between enterprises or to maintain competitive order and promote innovation This contentious point in judicial practice is both a conceptual and a practical issue. In theory, this should not be a matter of debate, because trade secret crimes are categorised as crimes of disrupting the socialist market economic order in Chapter III of Criminal Law, which should be clear-cut. However, in handling specific cases, some judi - cial and administrative personnel still view these as economic disputes, believing that they should not intervene and even suggesting that the rights holders resolve the issue through civil litigation. This perspective can lead to difficulties in filing cases at the public security stage, reluctance at the prosecution stage and slow progress in case handling, directly resulting in challenges in enforcing trade secret rights. My team believes adequate trade secret protec - tion needs a refreshed understanding of relevant laws throughout the judicial and administrative organs. 2. How to determine the contribution rate of the specific content of trade secrets in the infringing product This contentious point in judicial practice is the issue encountered when calculating the amount involved in the case. This problem is related to how the criminal case filing threshold amount of CNY300,000 should be calculated. Taking tech - nical trade secrets as an example, some believe that the necessity of the trade secret should be taken into account, ie, whether the related tech - nology is indispensable; some think the propor - tion of the technology in the overall technology should be considered; others suggest that the
independence of the technology should be the standard, based on whether other equipment or technologies need to be separated; and some argue that the value of the technology itself should be the basis for calculation. Each standard has its rationale, but I personally favour the necessity of trade secret approach. My reasoning is that, since trade secret crimes fall under the category of economic order crimes, they primarily aim to maintain fair competition among commercial entities in the economy, regulating behaviours that use unfair means for competition. The essence of these crimes emphasises honest business practices and competitive order. Moreover, the content of trade secrets only needs to be non-public, with - out having to meet the novelty and non-obvi - ousness standards required for patents; thus, a rather low standard should be set to avoid sig - nificant potential harm caused by infringement acts. Trade secrets infringement acts not only cause an imbalance in market competition but also greatly increase management costs and severely damage the enthusiasm for innovation among market entities. Therefore, the establishment of trade secret crimes is essentially based on the overall social value, making it appropriate to consider the overall impact of the necessary trade secret when calculating losses or the value of trade secrets. I advocate holistic assessments to align with the law’s intent to protect fair competition. 3. How to summarise the content of trade secrets This point of contention is about the common practice in Chinese courts to summarise the content of trade secrets as so-called “trade secret points” (which have no clear non-legal
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