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Highlights of Draft Taiwan IPO Trade Secrets Bill

by WP

After a further round of revisions to its draft bill to enhance criminal penalties for trade secret misappropriation, the Taiwan Intellectual Property Office submitted the bill to the Executive Yuan in mid-August where it is currently being reviewed. If approved, the Executive Yuan will send the bill to the Legislature where it enjoys broad support.

While the TIPO has not released the full text of its final version of the draft bill, it released a Chinese-language summary of the bill which we translate here. The most important addition to the earlier drafts is the final  ’duty to make a defense’ that creates a discretionary presumption in favor of the plaintiff  if the defendant refuses to answer the plaintiff’s claims.

Offenses

  1. Acquiring a trade secret by improper means (such as stealing, embezzlement, fraud, coercion, or unauthorized reproduction)
  2. Using or disclosing  a trade secret by the person who acquires a trade secret by improper means
  3. Reproducing, using, or disclosing that trade secret without authorization or by exceeding the scope of authorization
  4. Having been instructed to delete or destroy a trade secret by the owner of the trade secret and failing to delete or destroy the trade secret or continuing to conceal the trade secret
  5. Acquiring, using, or disclosing a trade secret after maliciously receiving it

Criminal Penalties

Imprisonment of up to five years and a criminal fine: NT$50,000 to NT$10,000,000.

Extraterritorial  Enhanced Penalties

Enhanced penalties for any of the offenses where the offender intends to use the trade secrets in a foreign country, the Mainland Region, Hong Kong, or Macau.

Vicarious Criminal Liability

If an employee commits any of these offenses, the employer is also subject to criminal liability unless the employer has made utmost efforts to prevent the offense.

Duty to Make Concrete Defense to Advance Proceedings

When a plaintiff has explained and clarified the facts related to an infringement or likely infringement of its trade secret, and if the defendant denies such conduct, the defendant shall make a concrete defense of what he has denied; if the defendant does not reply to the allegations or fails to provide a sufficiently concrete defense by a deadline, the court may, after considering the circumstances, deem [the facts] explained and clarified by the plaintiff to be true.

 

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