EU Parliament votes for Trade Secrets Directive

On 14 April 2016, the EU Parliament voted by 503-131 to adopt the “Directive of the European Parliament and of the Council on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure” (“Directive”). The Directive aims to facilitate the cross-border transfer of know-how and to foster competition and innovation.

With its vote, the Parliament approved an informal agreement between the Commission, the Parliament and the Council of 18 December 2015 the content of which remained unchanged (the results of the trilogue meeting were discussed here). Compared to the Commission’s initial proposal, the agreed text puts even more emphasis on the protection of the general public interest and the right to freedom of expression and information and thus strengthens the legal position of whistleblowers and the media.

Still, under the fresh impression of news coverage on the so-called “Panama Papers”, some felt that whistleblowers and journalists would not be adequately protected under the terms of the Directive, and the matter was extensively discussed during the debate of the European Parliament on 13 April 2016. The request made on 14 April 2016 that the vote be postponed pending a proposal by the EU Commission for a stronger protection was rejected by the Parliament, and the Commission’s proposal with the agreed amendments was approved.

It is expected that the Council approve and thus formally adopt the Directive on the occasion of its next meeting provisionally scheduled for 17 May 2016. After adoption, the Member States will have two years to implement the provisions of the Directive into national law.