Directive (EU) 2016/943

[Question 1]

Will Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure which came into force on 5th July 2016 have any impact on the common law action of breach of confidence?

I am asked to address the following issues in this opinion:

  1. What is the purpose of Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure?

 

  1. What impact can Directive (EU) 2016/943 have on the common law action of breach of confidence?

 

  • Trade secrets

1.1 In order to consider those questions, it is necessary to consider the definition of a “trade secret”. In the preamble of the 2016 Directive[1] the importance of such a definition is highlighted, so as to harmonise across the Union the definition by which trade secrets can be recognised. A clear definition of trade secrets is provided in the 2016 Directive, under Article 2,[2] which includes the specific requirements that trade secrets need to possess to be classified as such, including characteristics of confidentiality and commercial value.

1.2 The United Kingdom has no codified system in the area of protecting trade secrets; instead the common law system of breach of confidence applies here, and through the case of Coco v A.N. Clark[3] a definition can be drawn to identify a trade secret. The elements of this definition to be satisfied to identify a trade secret must include “the necessary quality of confidence about it”, “that information must have been imparted in circumstances importing an obligation of confidence” and “there must be an unauthorised use of that information” as stated by Judge Megarry.[4]

[1] Directive (EU) 2016/943 Recital (14)

[2] Directive (EU) 2016/943, Ch.1, Art. 2 (1) (a), (b) and (c)

[3] Coco v A.N. Clark (Engineers) Ltd [1969] F.S.R. 415

[4] ibid. Para 15, http://www.abogadosaccidenteskp.com