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According to the North Atlantic Free Trade Agreement (NAFTA) “a trade secret refers to any information of commercial value that is not in the public domain and for which reasonable steps have been taken to safeguard its secrecy,” Unauthorized acquisition, use, or disclosure of such secret information by others in a manner that is contradictory to honest commercial practices is considered as an unfair practice and a violation of trade secret protection.
To qualify as a trade secret, the information should be:
A company’s trade secrets are valuable assets that must be safeguarded. In general, trade secrets refer to information that has economic value but is not publicly known. It’s critical to take reasonable precautions to prevent trade secrets from being exposed and to keep them secret. Formulas, methodologies, plans, techniques, processes, customer lists, customer requirements, product specifications, pricing strategies, and recipes are all trade secrets that a business owner may wish to protect.
It is critical to make reasonable steps to keep trade secrets confidential. Keeping all materials in a safe location, marking documents as confidential, limiting sensitive information access to employees who need to know only, and having employees with access to sensitive information sign non-disclosure agreements are all recommended actions to keep trade secrets confidential.
When trade secrets are revealed by unethical means, such as theft, they might be misused. Bribery, misrepresentation, breach of obligation to maintain secret, and electronic all examples of misappropriation. An injunction or restraining order can be used to prevent the misappropriation of trade secrets.
Maintaining the secrecy and security of trade secrets can be essential for the success of a company. As a result, it’s crucial for business owners to understand how to protect their trade secrets and what steps to take if their trade secrets’ confidentiality is violated.
The TRIPS Agreement says that confidential information, such as trade secrets that can be protected under Article 39.2 which means that the information that is confidential, has commercial value because of its secrecy, and has been subjected to reasonable efforts to keep it secret must be protected.
The Agreement does not need that confidential information to be treated as property, but it does require that a person lawfully in control of such information be able to prevent it from being revealed to, used by, or acquired by others without his or her consent in a way that is contrary to commercial practices. Inducement to breach of contract as well as the acquisition of undisclosed information by third parties who knew, or were failing to know were involved in the acquisition, are all instances of “manner contrary to honest commercial practices.”
Trade secrets cannot be legally protected since they are secrets; nonetheless, the consequences of a breach of trust or a legal contract can be enforced. Legal protection of trade secrets can be derived from many diverse sources of laws governing employee/employer relations and fiduciary obligations. The character of trade secret law often makes enforcement challenging. In India, trade secrets are protected by contract law or the equitable concept of breach of confidentiality. It is usual to include confidentiality clauses in a technology transfer or other licence agreement to ensure that the subject matter remains confidential not only during the workers’ and contractors’ employment period but also after their termination, though for a limited time. Contractual obligations can also protect a profession’s skill, knowledge, and experience from being misused in certain circumstances.