India's Leap Towards Reinforcing IP Protection and Innovation with the Draft Protection of Trade Secret Bill, 2024.

Here we have a potential step in the development of IPR laws in India, stemming from the newly presented THE PROTECTION OF TRADE SECRETS BILL, 2024. It is pertinent to note that trade secrets are as crucial for any manufacturer or business as all other intellectual property and were previously governed by the contract act as part of non-disclosure agreements. However, in the given scenario, it would be great to have specific laws for trade secrets. While presenting the bill, the law panel observed, “In today's economic climate, there are fast-emerging technologies and sectors such as artificial intelligence (AI) and data-driven technologies that have gained significance...The law as it stands now is fragmented and difficult to navigate. A statute will bring clarity and espouse confidence in the legal system amongst the industry”.

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Here are some salient features of the Bill:

Section 2 (f) of the bill defines trade secrets. It provides:

"trade secret" means any information—

(i) that is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question;

(ii) that derives commercial value on account of being secret;

(iii) that has been subject to reasonable steps under the circumstances, by the holder of such information, to keep it secret; and

(iv) the disclosure of which is likely to cause damage to the holder of such information.

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Further, the explanation of the clause provides that experiences and skills acquired by an employee in the course of normal professional practice; or any information disclosing a violation of any law shall not amount to trade secret.

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Chapter II of the bill, consisting of sections 3 to 6, provides for the Acquisition, use, and disclosure of the trade secret, as well as Chapter III of the act, consisting of sections 7 to 10, provides for legal proceedings. The primary focus of relief remains the injunction supported by other relief including but not limited to orders for surrender and/or destruction of the documents, objects, etc. (The Bill is divided into four chapters with 13 sections - the PDF copy has been attached for reference).

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In conclusion, the introduction of THE PROTECTION OF TRADE SECRETS BILL, 2024 marks a significant stride in India's intellectual property rights landscape. With the exponential growth of innovative industries like artificial intelligence and data-driven technologies, a comprehensive legal framework for safeguarding trade secrets is imperative. The clarity and confidence instilled by this statute will not only fortify businesses but also foster a culture of innovation and competitiveness. By defining trade secrets and delineating mechanisms for acquisition, use, and legal recourse, the bill sets a solid foundation for protecting the invaluable assets of businesses in the ever-evolving global market.

Authored By: Shri Harsh