Brussels, 30/03/2016 (Agence Europe) - Corporate Europe Observatory (CEO) is warning MEPs about the dangers inherent in the directive on the protection of trade secrets.
On Wednesday 30 March, a coalition of European civil society, worker protection and journalists' organisations sent members of the European Parliament a critical analysis of the draft directive, urging them to reject it. The coalition says the draft directive “creates excessive rights to secrecy for businesses”.
Following agreement reached between the European Parliament and the Council of the EU on the draft directive to protect business secrecy in December 2015 (see EUROPE 11454), the European Parliament will be invited to take a position on the directive in Strasbourg on Thursday 14 April.
By definition, business or trade secrets include everything businesses wish to keep secret to protect their competitive edge, but opponents see a danger in the very definition of the term in the draft directive, viewing it as “too wide”. “Almost all internal information within a company can be considered a trade secret”, they explain.
CEO raises a number of threats that such a proposal might contain: - companies would no longer have to identify information they consider as being trade secrets; - anyone desiring to access such information would now be threatened with judicial proceedings if going ahead because the exemptions foreseen in the directive do not provide sufficient protection - legal uncertainties risk putting people off communicating information to the public revealing company behaviour that could be criticised or might break regulations; - the directive foresees restricting the publication of documents during judicial proceedings; - the directive creates minimum legislation in the EU and member states will be able to go further when they transpose it into their legal systems. This will create a heterogeneity of legislation in the EU which companies could then exploit by issuing court cases from countries that have introduced stricter protection of business secrecy.
The people concerned. The coalition says consumers are not immune from the risks. Only independent studies will be able to confirm whether or not products that are used by consumers on a daily basis are dangerous. Unfortunately, such studies are carried out by manufacturers, which then send them to public bodies (which decide whether or not to authorise sale of the product). CEO says: “The problem is that producers systematically oppose the publication of these studies as they consider that they contain trade secrets and should not be seen and used by competitors”, and independent scientists will therefore be unable to advance the debate.
The directive's critics say the battle will be tough for journalists. They say that despite a number of elements of the text affirming that the right to be informed is not jeopardised by the directive, “there is no guarantee”. Companies will have the right to issue legal proceedings against anyone publishing without their consent information they deem to be trade secrets. “Journalists will have to weigh up the risk, taking into account potentially very high financial damages”, says CEO.
It will not be easy for whistleblowers either. As important sources of information for the media and public authorities about abusive corporate behaviour, they would only have protection for revealing a fault, embezzlement or an illegal activity, as long as the whistleblower acted to protect the general public interest (Article 5). Whistleblowers would therefore have to prove that they acted to protect the general interest. The burden of proof would be upon them although they do not generally have the same financial means as big companies at their disposal.
Finally, workers would be among those most concerned. The large majority of existing court cases over violations of business secrecy are by companies against their former employees. The idea of 'business secrecy' is so broad that a lot of information learned by workers doing their jobs could be seen as trade secrets. Changing employer and therefore using skills and information that could be considered business information by their former employer would be very dangerous since legal proceedings are possible up to six years after leaving an employer. This would have the consequence of holding back worker mobility and therefore innovation, says the coalition.
CEO's analysis also shows that if the directive is approved at EU level, member states will be able to go further when they adapt it to suit their own legislation and one can expect multinationals to encourage them to do so. Martin Pigeon from the European Observatory of Multinationals (EOM) says: “This is not going to be an easy battle: multinational corporations have been lobbying for this directive for years”. He said the final opportunity would be to reject the draft legislation en bloc or to improve it. (Original version in French by Maëlle Didion)