LLAW6132 Chap.7 Trade Secret Regimes Compared: US, EU and PRC
Trade Secret Regimes Compared: US, EU and PRC
Convergent definitions, divergent routes
The United States, the European Union and China all define trade secrets around the TRIPS conditions.
The differences lie in forum, criminal liability, exceptions, proof and damages, and a comparative answer should be organised around those issues rather than around each system in turn.
The United States
Most states have adopted the Uniform Trade Secrets Act, and the Defend Trade Secrets Act of 2016 adds a federal civil action for secrets related to products or services in interstate or foreign commerce.
Improper means include theft, bribery, misrepresentation and espionage, but not reverse engineering or independent derivation.
The Economic Espionage Act separates espionage for a foreign government from theft for gain, and the lecture's AI case shows the difference: the espionage counts fell for want of proof of intent to benefit a foreign government, while the theft counts stood.
The European Union
The 2016 Trade Secrets Directive repeats the TRIPS definition.
National courts have read reasonable steps as external and internal access controls and accepted logging systems with passwords.
The Directive makes independent discovery, reverse engineering, workers' information rights and honest practices lawful routes, preserves public interest disclosure, and protects disclosure that reveals misconduct in the public interest.
China
Article 10 of the 2025 Anti-Unfair Competition Law lists the wrongful acts and makes a third party liable if it knew or should have known.
The market regulator's provisions define technical and business information, commercial value, what counts as publicly known and what counts as reasonable confidentiality measures. The courts have protected combinations of public information, accepted measures that are not seamless, and awarded damages in the hundreds of millions of yuan, and the 2025 Law shifts the burden of proof and permits multiplied damages.
What this chapter covers
- 01
The Uniform Trade Secrets Act and the Defend Trade Secrets Act
- 02
Improper means and the lawful routes
- 03
Economic espionage against trade theft
- 04
The EU Directive's definition and reasonable steps
- 05
Public interest and whistleblowing exceptions
- 06
SAMR rules on public knowledge and confidentiality measures
- 07
Combination secrets, measures and damages in Chinese cases
Worked example · free
Compare the proof burden in two forums
- 4State the Chinese burden-shifting rule and apply it.
- 2Contrast the US position on misappropriation.
- 2Conclude on the better forum for this evidence.
Key terms
- Misappropriation
- Acquiring a trade secret by improper means, or disclosing or using it without consent where it was so acquired, under US law.
- Improper Means
- Theft, bribery, misrepresentation, breach of a duty of secrecy or espionage, excluding reverse engineering and independent derivation.
- Economic Espionage
- Stealing or misappropriating trade secrets to benefit a foreign government or its agency or agent, a crime separate from theft for gain.
- Confidentiality Measures
- The steps a Chinese right holder takes to keep information secret, listed in the market regulator's provisions and judged by what prevents leakage normally.
- Burden Shifting
- The 2025 Chinese rule moving proof to the defendant once the holder shows confidentiality measures and a reasonable indication of infringement.
Trade Secret Regimes Compared: US, EU and PRC FAQ
Why were the espionage charges in the AI chip case dismissed?
The lecture reports that the court found the prosecution had proved the theft of trade secrets but not an intent to benefit the Chinese government, which economic espionage requires. The seven theft counts were upheld, with a twelve-month sentence, damages of $198,000 and a $2,500 fine.
Can publicly available information be a trade secret in China?
A combination can be. The market regulator's provisions treat new information made by organising or improving public information as capable of protection, and in the rubber antioxidant case the court held that a hundred documents did not show the protected combination was public.
Does the EU Directive protect whistleblowers who take trade secrets?
Article 5(b) covers acquisition, use or disclosure for revealing misconduct, wrongdoing or illegal activity where the respondent acted to protect the public interest. The lecture asks whether auditing an AI system for bias fits that exception, which turns on misconduct and motive.
Exam move
Make a four-column table of issues against the three regimes, definition, wrongful acts, lawful routes, remedies, and fill each cell from memory. Then practise a comparative paragraph that crosses the table row by row rather than down each column.
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