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LEGAL NEWS - Business Secrets

Logo Lead
20. March 2018

The Ministry of Industry and Commerce has recently submitted a bill concerning a new Danish Act regarding the protection of business secrets.

The purpose of the legislative proposal is the implementation of an EU directive, which aligns legislation throughout the EU. With the implementation, it will be easier and simpler for companies to operate in other EU countries, which leads incentive to innovate across the Union.

The bill implements the European Parliament and the Councils Directive 2016/943 / EU of 8 June 2016 on the protection of confidential know-how and confidential business information (business secrets) against unauthorized acquisition, use and disclosure. The aim of the Directive is to enhance the protection of companies’ trade secrets and know-how, and the Directive was adopted for companies to improve and optimize their business. Member States must implement the Directive into their national legislation until 9 June 2018. 

The Danish bill ensures protection of business secrets and creates a uniform framework for companies across the EU. The bill compiles Danish regulation in this area, so that companies have a better basis for protecting their business secrets. Furthermore, the compilation constructs a better overview of the legal area. The current different laws in EU member states makes it difficult for companies to gain an overview of how their business secrets are protected across the different EU countries. The aim of the implementation is will give companies better tools to actively enforce the protection of their business secrets.

In practice, there are no major changes in Danish law due to the implementation. Today the Danish Marketing Practices Act for example regulates the prohibition against unlawful use and disclosure of trade secrets for employees (article 23). When the new Act on Trade Secrets comes into force, article 23 of the Danish Marketing Practice Act will be repealed.

Additionally, the new Danish Act on Trade Secrets contains specific legal provisions on what constitutes a legal and illegal acquisition and a specific definition of the concept of business secrets. The definition corresponds to previous Danish practices arising from the Marketing Act and the courts, which must be:

  • information that is not publicly available, and which 
  • must have economic value, and which 
  • is subjected to a certain degree of confidentiality and protection. 

The definition of business secrets includes know-how, market and business strategies and inventions.

Furthermore, the bill sets out the reaction possibilities of a business secret to an offending party. This means that companies get clearer guidelines and tools when it comes to protecting their business secrets in Denmark and in the EU. On 23 January 2018, the bill was considered and referred to a committee. If the new Act is adapted, it will come into force on 9 June 2018.

For further information you are welcome to contact attorney Alexandra Huber at alexandra.huber@lead-roedl.dk  

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