Protection Of Trade Secrets In France: Entry Into Force Of Welcomed Procedural Clarifications
French Decree No. 2018-1126 dated 11 December 20181 (the "Decree") on protection of trade secrets implementing French Act No. 2018-670 of 30 July 20182 (the "Act") was published on 13 December 2018 in the "Journal Officiel de la République française". Almost all of its provisions will enter into force the day following its publication.
The Decree, eagerly awaited by practitioners, introduces a new section within the French Commercial Code devoted to protection of trade secrets.
The main contributions of the Decree are:
a clarification of the content of provisional and protective measures that may be ordered ex parte or following summary proceedings in case of infringement of trade secrets, a definition of the procedural rules related to protective measures of trade secrets that apply before civil and commercial courts, and incidentally, a harmonisation of the terminology used within various French codes. Enhanced provisional and protective measures to protect trade secrets
The new Article R. 152-1 of the French Commercial Code clarifies the rules for granting provisional and protective measures to prevent any imminent infringement or to put a stop to any ongoing infringement of trade secrets.
These measures, which should be proportionate3, may include, inter alia, (i) a prohibition of any use or disclosure of trade secrets, and (ii) a prohibition of any manufacturing, offering for sale, putting on the market or use of products that are suspected of resulting from a significant infringement of trade secrets.
The Decree also allows the possibility of ordering seizure, or placement in a third-party escrow, of such products so as to prevent their entry or movement on the market - which was not provided for by the Act.
Introduction of a "security for costs" type guarantee mechanism
The new Article R. 152-1 II and III innovatively introduces a guarantee mechanism that was not explicitly provided for by the Act.
The judge will thus be able to order the provision of financial guarantees:
to the plaintiff who was granted provisional or protective measures, if the alleged infringement of the secret is subsequently found to be baseless, in order to compensate the defendant or any third party harmed by the measures, and to the defendant, as a condition for allowing it to continue the alleged infringement (and to ensure possible subsequent compensation to the secret holder). This guarantee mechanism will probably enable the judge to ensure a...
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