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New Amendment to the Trade Secrets Act



The Legislative Yuan passed a third reading of the amendments to the provisions of the Trade Secrets Act on December 31, 2019, expressly stipulating that any unrecognized foreign juristic person may file a complaint for public prosecution, private prosecution, or civil action pursuant to the provisions of the Trade Secrets Act, which solves the differences in the past judicial practice. In addition, this amendment also adds the "Protective Order in Criminal Investigation" system, with the following highlights:

 

Protective Order in Criminal Investigation

Who has the right to issue

Prosecutor

  • The prosecutor who investigates trade secret cases may issue a protective order in criminal investigation when it is deemed necessary for investigation.

Who are the ones subject to a protective order in criminal investigation

Suspects, defendants, victims, complainants, agent of complainants, defense attorneys, expert witnesses, witnesses or other relevant persons who have access to the contents of investigation.

Contents of a protective order in criminal investigation

  • Person(s) subject to a protective order in criminal investigation.
  • Investigation contents that shall be kept confidential.
  • A person subject to a protective order in criminal investigation shall not use the content of the investigation for purposes other than performing investigation procedures and shall not disclose it to a person who is not subject to a protective order in criminal investigation.
  • Effect of violation.

Investigation contents that shall be kept confidential

Trade secret owners shall be given the opportunity to submit comments or provide a response

Effect of a protective order in criminal investigation

Violators assume criminal liability

  • Violation of the protective order in criminal investigation (regardless of whether the violation occurred domestically or abroad) shall be punished with imprisonment for not more than three (3) years, detention, and/or a fine of not more than NT$ 1 million.

Whether a protective order in criminal investigation can be changed or revoked

  • The prosecutor may change or revoke a protective order in criminal investigation in the following circumstances:
    • The reasons subject to confidentiality has become extinguished during the investigation
    • It is necessary to change the content of the protective order in criminal investigation
    • The case is subject to a final and irrevocable decision to defer the prosecution or not to prosecute
    • The protective order in criminal investigation includes any part which is out of the effect of prosecution
  • The court may revoke a protective order in criminal investigation in the following circumstance:
    • The trade secrets owner or the prosecutor fails to motion for a confidentiality preservation order to the court within 30 days from the date upon the case being pended at the court

What can a trade secrets owner do?

  • The trade secrets owner has the opportunity to submit comments or provide a response on the issuance, revocation and change of the protective order in criminal investigation
  • The trade secrets owner may file an objection against the prosecutor’s revocation or change of the protective order in criminal investigation
  • The trade secrets owner may motion to the court for issuing a confidentiality preservation order upon the prosecution of the case
  • The trade secrets owner may file an appeal against the court's ruling to revoke the investigation confidentiality order

Will the protective order in criminal investigation be affected after the case is prosecuted by the prosecutor?

  • If the trade secrets owner or prosecutor motions to the prosecution court for a confidentiality preservation order within 30 days from the date upon the case being pended at the court,
    • For the part of a protective order in criminal investigation to which the prosecution effect extends, within the scope of the said confidentiality preservation order, it shall become void when the court’s ruling issuing said confidentiality preservation order becomes final and irrevocable.
  • If the trade secrets owner or prosecutor fails to motion to the prosecution court for a confidentiality preservation order within 30 days from the date upon the case being pended at the court,
    • For the part of a protective order in criminal investigation to which the prosecution effect extends, within the scope of the protective order in criminal investigation revoked by the court’s ruling, it shall become void when the court’s ruling revoking the said investigation confidentiality order becomes final and irrevocable.

 

In the previous criminal investigation procedures of trade secrets cases, the trade secrets owner has to provide evidence proving that he/she does possess the trade secrets, and explain confidential information such as the content of the trade secrets, the process of research and development, and details of cooperation with other partners. Owning to inadequate legal protection, the evidence seized by the investigation and prosecution authorities and presented by the trade secrets owner often faced the risk of being leaked during the investigation stage, which may cause further injury to the trade secrets owner. The amendment to the Trade Secrets Act has established a "Protective Order in Criminal Investigation" system, allowing prosecutors to issue protective orders in criminal investigation on their own initiative during the investigation stage, and restricting confidential information involved in the investigation process from being disclosed to others arbitrarily. With the rights and interests of the trade secrets owners being protected and the protection of trade secrets strengthened, it is indeed an important development of the legal system of trade secrets.



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