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Trade secrets

Harmonisation could undermine fundamental rights

The European Parliament's Legal Affairs committee today voted on draft legislative proposals on the protection of trade secrets. While the Parliament's proposals are a slight improvement on the original Commission proposals, Greens/EFA demands on improving transparency requirements were rejected. Greens/EFA MEP Julia Reda, Member of the Legal Affairs committee commented:

“This proposal does not provide any added value for EU companies or, a fortiori, innovation in the EU. Supporters of the proposal relied on a flawed argument by which insufficient protection of trade secrets would hamper innovation in the EU. But if EU member states want to promote innovation, they should increase their research and development spending.

The European Commission states that its proposals were necessary because of the need to harmonise rules across the EU. However, this will not be possible without undermining fundamental rights. For example, up to now, the only information which German courts have recognised as trade secrets is information whose disclosure would threaten the company’s legitimate economic interests. Yet the draft directive makes no mention of this important test of legitimate interest. This would enable companies to easily withhold from the public any information whose disclosure might embarrass the company. Fundamentally, the directive’s very vague definition of trade secrets means that companies have leeway to abuse the legislative provisions.

This proposal is especially wrongheaded in light of the recent revelations of spying by the American intelligence service, helped by the German intelligence service, in numerous large European companies.

Nevertheless, the Greens/EFA Group succeeded in adding provisions allowing whistleblowers to reveal trade secrets when it is in the general public interest. Whistleblowers are now not obliged — as initially called for by the Commission — to prove that their revelations were essential for the detection of an irregularity.”