Trade Secret and Confidential Information

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Trade Secret -- Definition

A trade secret is information that is not generally known to the public; confers economic benefit on its holder because the information is not publicly known; and where the holder makes reasonable efforts to maintain its secrecy [See wiki] (https://en.wikipedia.org/wiki/Trade_secret)(https://en.wikipedia.org/wiki/Trade_secret). Trade secrets are a type of intellectual property that includes formulas, practices, processes, designs, instruments, patterns, or compilations of information that have inherent economic value because they are not generally known or readily ascertainable by others, and which the owner takes reasonable measures to keep secret [see wiki] (https://en.wikipedia.org/wiki/Trade_secret) See Cornell.

More information:

Summary of Trade Secret FAQ (WIPO)

Trade Secret FAQ

What is a trade secret? A trade secret is information that is not generally known to the public; confers economic benefit on its holder because the information is not publicly known; and where the holder makes reasonable efforts to maintain its secrecy.
What kind of information is protected by trade secret? Trade secrets are a type of intellectual property that includes formulas, practices, processes, designs, instruments, patterns, or compilations of information that have inherent economic value because they are not generally known or readily ascertainable by others, and which the owner takes reasonable measures to keep secret.
What kind of protection does a trade secret offer? Trade secret protection provides an alternative to patent protection for inventions that cannot be patented or for which patent protection is not desired. Trade secret protection can also be used in conjunction with patent protection. Trade secrets can be protected indefinitely as long as they remain secret and continue to provide economic value to their owner.
How are trade secrets protected? Trade secrets are protected by keeping them secret. This means that the holder of a trade secret must take reasonable steps to keep it secret, including the use of confidentiality agreements for business partners and employees.
What are the requirements for trade secret protection? To qualify as a trade secret, information must be:
- not generally known to the public;
- confer economic benefit on its holder because the information is not publicly known; and
- where the holder makes reasonable efforts to maintain its secrecy.
What are the rights conferred by trade secrets? The holder of a trade secret has the right to prevent others from acquiring, using or disclosing that secret information without his consent.
Is it possible to sell and license trade secrets? Yes. Trade secrets can be sold or licensed.
What are the remedies provided to the holder of secret information? The remedies provided to the holder of secret information include injunctions, damages and account of profits.
What is the international legal framework of trade secret protection? The international legal framework of trade secret protection includes:
- The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement);
- The Uniform Trade Secrets Act (UTSA); and
- The European Union Trade Secrets Directive.
Why is trade secret protection necessary? Trade secret protection is necessary because it provides an alternative to patent protection for inventions that cannot be patented or for which patent protection is not desired. Trade secret protection can also be used in conjunction with patent protection. Trade secrets can be protected indefinitely as long as they remain secret and continue to provide economic value to their owner.

TRIPS and Trade Secret in Indonesia

According to a paper by Rahmatya et.al , Indonesia has ratified the Agreement on Trade-Related Aspects of Intellectual Property Rights and passed the Trade Secrets Law No. 30 of 2000. The law protects every citizen’s rights whether they were acquired as a result of a transfer or arose as a consequence of their own creation.

The protection of trade secrets in Indonesia is regulated under Law No. 30 Year 2000 on Trade Secret (“Trade Secret Law”). By definition, a trade secret is information that is unknown to the public in the field of technology and/or business. The information should also possess economic value due to its use in trade, and the secrecy should be kept by the owner

KPPU Draft Guideline on Trade Secret

Trade Secret and KPPU Guideline

This a draft of a guideline made by the Indonesian Competition Commission (KPPU) to explain the prohibition of collusion for information in Article 23 of Law No. 5 of 1999. The guideline focuses on explaining the prohibition of collusion for information. Article 23 prohibits business actors from colluding with other parties to obtain information about their competitor’s business activities that are classified as trade secrets, which can result in unhealthy business competition. The approach used in Article 23 is the rule of reason approach, which looks at and considers the impact or effect of such collusion on competition.

The guideline explains the general principles and basics used by KPPU in conducting an analysis to assess collusion for information as regulated in Article 23 of Law No. 5 of 1999. It should be seen as a general explanation, so in practice, the application of this guideline will be adjusted to the investigation and examination process on a case-by-case basis. In addition, this guideline is expected to further explain the limitations of provisions in collusion for information that are considered to violate the principles of competition law.

Trade secrets are defined as business activity information that has never been disclosed by its owner to anyone except those who are directly related to the business activities of the owner of such trade secret information. There is no specific definition provided by legislation regarding trade secrets. However, in law, the concept of trade secrets has been explained since January 31, 1919, by the Supreme Court of the Netherlands in its famous decision known as Lindenbaum Cohen Arrest (HR 31-01-1919, NJ 1919, 161), a Supreme Court decision regarding unlawful acts.

In summary, Article 23 prohibits business actors from colluding with other parties to obtain information about their competitor’s business activities that are classified as trade secrets. Trade secrets are defined as business activity information that has never been disclosed by its owner to anyone except those who are directly related to the business activities of the owner of such trade secret information.

Examples of Non Disclosure Agreements

Example 1 (hbs.edu)
Example 2 (Silvester Legal)
Example 3 (Satnusa)