Deep & Far Newsletter 2014 ©
March, 2014

The Minutes from the Public Hearing on Proposed Amendments to the Trade Secrets Act:

Wei-Ting Chou, Patent Director, Patent Group I

¡½ Master of Agricultural Engineering, National Taiwan University

¡½ Bachelor of Medical Engineering, National Cheng Kung University


1. In Article 10, because what can be infringed should not be a ¡§trade secret¡¨ of ¡§information¡¨, but should be a ¡§trade secret right¡¨ in the form of a ¡§right¡¨, it is suggested to amend the term ¡§trade secrets¡¨ to ¡§trade secret right¡¨.

2. It is not necessary to define at the same time the illegal acquirement in Clause 1 and the further use or disclosure in Clause 2 of Paragraph 1 of Articles 10 and 13-1.  Otherwise, in the circumstances of the illegal acquirement and the further use or disclosure, it will be difficult to determine whether a single or more misappropriation actions exist.

3. The action, of ¡§contacting¡¨ or ¡§prying¡¨, itself is only an ¡§inappropriate action¡¨, but not an ¡§illegal action¡¨.

4. In Article 10 or Paragraph 3 of Article 13-1 in the proposed amendments, it is considered that the action of bringing out should mean a possession without authorization and is not limited to the action of bring out the originally possessed trade secret after reproduction.

5. If there is inaction after being requested by the trade secret holder to delete or destroy the documents of trade secrets, no matter whether there is the action of concealing the trade secrets, such inaction shall be deemed as violating the trade secret holder¡¦s intention that the documents shall not be possessed, and thus will be determined as infringing the trade secret right.  If the infringement is established only if there is the action of the ¡§concealment¡¨, when the trade secret documents are not deleted or destroyed, it will be necessary to find whether there is the action of the concealment to decide whether the infringement is engaged, and thus additional but unnecessary efforts will be needed.

6. Paragraph 2 of Article 13 of the Trade Secrets Act is indeed enacted with reference to Paragraph 2 of Article 88 of the Copyright Act, and thus shall incorporate both the former part and the latter part in Paragraph 2 of Article 88 thereof.  If only the former part is incorporated, but the latter part ¡§when the action of misappropriation is intentional, and the circumstance is serve¡¨ is not, the injured party will not be able to claim a higher damage when sh/e cannot prove the actual damage of intentional misappropriation under a severe circumstance.  Therefore, the latter part shall be incorporated thereinto.  In addition, the stipulations of punitive damage in the current Paragraph 2 could coexist with the stipulations of statutory damage in the newly amended Paragraph 2, so that the trade secret holder can make a choice therebetween.  Specifically, the choice depends on whether the trade secret holder can prove damage, and which way of claiming the damage is advantageous thereto.  In fact, when the rights to the trade secrets are infringed, it is not easy to prove the actual damage.  Even if a proven damage can be found, such proven damage is usually far lower than the actual damage.  In the current Paragraph 2, the stipulations are based on the premise that the action of misappropriation is intentional and the injured party can prove the damage.  However, because it is difficult that the damage can be proven, or the proven damage is far lower than the actual damage, there is still a need to have an option of claiming the statutory damage.  Accordingly, the stipulations of statutory damage added to Paragraph 2 in the proposed amendments are moved to Paragraph 3, so as to incorporate the intentional misappropriation and severe circumstance in Paragraph 2 to increase the amount of damage, and so as to avoid the circumstance that: when the action of misappropriation is intentional but the injured party cannot easily prove the actual damage, the court incorrectly finds that the statutory damage is lower than that due to the non-intentional misappropriation.

7. Referring to Clause 4 of Article 13-1 of the proposed amendments, it is improper that there is only a punishment for ¡§illegal use or disclosure when breaching the obligation to keep the secrets under a contract¡¨, but no punishment for the case of breaching the obligation to keep the trade secrets under a specific law.  As a suggestion, the stipulations for punishment on the latter one should be added.

8. As a suggestion, ¡§in foreign countries, Mainland China, Hong Kong, or Macau¡¨ should be amended to ¡§in jurisdictions outside the Republic of China¡¨ according to the context of Clause 1 of Article 4 of the Copyright Act.  In addition, it should be clearly described that the applicable subject is trade secret.

9. It is suggested to delete Article 14-1.