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The use of job hopping employees to bring in trade secrets may be suspected of crime, and the cross-border flow of trade secrets needs to be legal

Post:2020-12-29    Views:7011    Copy link   
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The amendment to the criminal law of the people's Republic of China (11), which came into effect on March 1, 2021, has amended the provisions on trade secret crimes as follows:

Article 219 Whoever commits one of the following acts of infringing trade secrets, if the circumstances are serious, shall be sentenced to fixed-term imprisonment of not more than three years and shall also, or shall only, be fined; if the circumstances are especially serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than 10 years and shall also be fined:

(1) Obtaining the business secrets of the obligee by theft, bribery, fraud, coercion, electronic intrusion or other improper means;

(2) Disclosing, using or allowing others to use the business secrets of the obligee obtained by the means mentioned in the preceding paragraph;

(3) Disclosing, using or allowing others to use the trade secrets they hold in violation of the confidentiality obligation or the obligee's requirements for keeping trade secrets.

Whoever knowingly obtains, discloses, uses or allows others to use the trade secret shall be regarded as infringing on the trade secret.

The obligee mentioned in this article refers to the owner of the trade secret and the user of the trade secret with the permission of the owner of the trade secret.

According to the article, companies and enterprises can be the victims of trade secret crimes as well as the perpetrators of trade secret crimes. If the trade secret of a company is obtained, disclosed, used or allowed to be used by employees or other people by improper means, the company is the victim of the trade secret crime at this time; if the company still obtains, discloses, uses or allows others to use the trade secret, such as the trade secret brought in by employees' job hopping, knowing that others infringe on the trade secret In this case, the person in charge and the person directly responsible may bear criminal responsibility.

It can be seen that companies should not only prevent their own trade secrets from being infringed, but also prevent inadvertently infringing others' trade secrets, thus constituting a trade secret crime.


The legitimacy of cross border trade secret flow

In addition, this amendment to the criminal law also adds one article as one of Article 219: Whoever steals, spies, buys or illegally provides business secrets for institutions, organizations or personnel outside China shall be sentenced to fixed-term imprisonment of not more than five years and shall also, or shall only, be fined; if the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than five years and shall also be fined.

That is to say, those who illegally obtain or provide trade secrets for institutions, organizations or personnel outside the territory commit a crime and are sentenced to fixed-term imprisonment of not more than five years without the "threshold requirement" of serious circumstances; if the circumstances are serious, they are sentenced to fixed-term imprisonment of not less than five years and a fine.

Institutions, organizations and personnel with cross-border business should properly handle the legitimacy of cross-border trade secret flow. When business partners, parent and subsidiary companies, multinational companies or affiliated companies conduct trade secret transactions, they need to conduct compliance review.

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