Undisclosed know-how and trade secrets enjoy stronger protection in Italy after the entry into force of the law implementing EU Directive No. 943/2016 on trade secrets.

Legislative Decree No. 63/2018 came into force on 22 June 2018, implementing into Italian law the European Union Directive No. 943/2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure.

The legislative decree, published in the Italian Official Gazette No. 130 of 7 June 2018, has introduced important changes while strengthening provisions for the protection of trade secrets and know-how already in force in Italy.

What has not changed?

The object of the protection remains unchanged.

Undisclosed know-how and trade secrets are still defined as “business information, technical and industrial experience, including business experience”.

In order to enjoy protection under the Italian Industrial Property Code, undisclosed know-how and trade secrets must:

• be secret
• have commercial value because they are secret
• have been subject to adequate measures to keep them secret.

What has changed?

Broader scope of protection

Legislative Decree No. 63/2018 provides that the holder of trade secrets or undisclosed know-how may act in court against their culpable or even blameless disclosure use, including the marketing of goods infringing them. Therefore the new law broadens the scope of protection, formerly limited to wilful misconduct only.

Stronger safeguards pending proceedings

Trade secrets also enjoy greater protection during court proceedings: companies have stronger safeguards when the proceedings refer to secrets or know-how, in order to maintain secrecy.

The court may forbid subjects taking part in the proceedings (parties, attorneys, expert counsel, etc.) to disclose or use the trade secrets or undisclosed know-how that they have become aware of during the trial, or may order “sensitive” information in court orders to be blacked out or removed.

Continuing unlawful use of know-how/secrets subject to security

In cautionary proceedings the judge may allow the alleged infringer to continue the alleged unlawful use of the undisclosed know-how or trade secrets subject to the lodgeing of a security.

The blameless infringer may request to continue the alleged unlawful use of the undisclosed know-how or trade secrets subject to the lodging of guarantees (to be calculated based on the royalty expected for the legitimate use of the secret) but the decision is remitted to the judge who should evaluate all circumstances of the case.

Stiffer criminal sanctions

 Legislative Decree No. 63/2018 has stiffened sanctions for the disclosure of illegally acquired trade secrets or know-how: criminal penalties have been raised to a maximum two years’ imprisonment, and can be made heavier if the disclosure is committed by electronic means.

The new Italian law enacting EU Directive No. 943/2016 on the protection of undisclosed know-how and trade secrets has therefore provided stronger measures to act against the theft of secret and valuable information.

However it remains essential, in order to access those measures, to be in a position to show that adequate protection was in place to keep the information secret.