The protection of the trade secret: is it on the field of Intellectual Property or on the repression of unfair competition?

jamely-garcia

 

Jamely García Cañizalez

Lawyer

 

 

 

 

 

Abstract

Even when the trade secret is a legal institute regulated mainly by Intellectual Property laws, on practice the owner of the protected information can use the mechanisms established in the unfair competition legislation in order to punish acts which violate the trade secret.

Today, traders and companies can protect their commercial, technical and any other relevant information by the “business secret” alternative. For years, it has contributed to develop companies, positioning them in the market. This is the case of a few famous business secrets in the history like the COCA COLA formula and the GOOGLE algorithm.

The “trade secret” is considered as a category of business secret and could be any commercial information of a company that is not available for to the competition. In this order, the doctrine indicates at least the follow requirements in order to classify an information as a trade secret. First, the information must be hidden. Second, the information must be relevant or important for the company. Third, the company must want to keep the information hidden from their competitors.

In addition, there are some international rules that protects business secrets, in which are included the TRIPs (Trade-related aspects of Intellectual Property rights) and the Andean Decision 486 (Common Industrial Property Regime). The abovementioned regulation is develop for each local legal systems.

In the case of Peru, the regulation of business and trade secrets is broad. The Legislative Decree 1075 (which develops the Andean Decision 486), the Legislative Decree 1044 (which establishes the rules for repression of unfair competition), the Directive No. 001-2008 on confidentiality of information for procedures handled by the Trademark/Patent Office and the Law 27826 (about the transparency and access to public information) are the most important regulation in the matter.

However, there is a doctrinal discussion about which is the most appropriate way to protect trade secrets, is it on the field of Intellectual Property or on the field of the unfair competition repression?

Some authors believe that the stipulation of trade secrets in Andean Decision 486 and in the TRIPs turns the trade secrets as a type of Intellectual Property rights, granting its owners an exclusive right over the protected information. In this sense, this theory propose some interesting advantages, for example: there is no need of a registration process because trade secrets are protected through the usual practice; the costs for the owner to prevent the release of information is limited and any trade secret has an unlimited time protection.

However, others authors do not agree with this position because on practice it is not possible to execute an exclusive right over the referred information as it is possible with a trademark, patent or any other invention typically of the Intellectual Property system. Also, article 262 of Andean Decision 486, which contains the ius prohibendi of the business secret, indicates clearly that the protection is limited to punish the unfair practices implemented for the disclosure, obtaining and use of the protected information.

At this point, is clear that business secret (or specifically trade secret) is protected in Peru against unfair competition practices. Article 13 of Legislative Decree 1044 establishes administrative responsibilities to anyone who discloses, obtains and exploits a trade secret without authorization or bad faith.

March 1, 2017 / Intellectual Property