The Law Commission (LC) recently released its report no. 289- “Trade Secret and Economic Espionage”. (Part 1, Part 2and Part 3). SpiceIP has posted on this , some points:
The LC report noted the failure of attempts to get companies to voluntarily license TS during COVID-19. As a result, it proposed a separate section in the Protection of Trade Secrets Act, 2024 (‘Draft Bill’) for CL of TS. Certain key features of the provision are-
- The Government can issue CL for use of TS to third parties or the Government in a situation of public emergency which involves substantial public interest.
- The recipient of the TS will be duty-bound to not disclose confidential information during or after the expiry of the license.
- The Government can terminate the license after such a public emergency has ceased to exist.
The LC has sought to balance the public interest with the interest of a licensor by narrowly construing ‘disclosure’ to mean disclosure only to a third party under strict obligations of confidentiality. It does not mandate public disclosure of the TS since the commercial value of the information derives from its secrecy.
