What is a trade secret?
Shhhhh! Did you know that confidential information can be protected by an intellectual property right called a trade secret?
The Coca-Cola recipe is one of the most famous business secrets. It is protected by an intellectual property right called a trade secret.
A trade secret can be any confidential business information which provides an organisation with a competitive edge. They are often used when an invention is not eligible for a patent or if the inventor does not wish to disclose the ‘secret’ publicly, which a patent requires you to do.
By their nature trade secrets have a commercial value because they are secret from competitors, or would-be competitors. There must be active steps taken by the holder of a trade secret to keep the information secret.
Common trade secrets include:
- sales methods
- distribution methods
- consumer profiles
- advertising strategies
- lists of suppliers and clients
- manufacturing processes
The unauthorised use of trade secret information by someone who is not the holder is regarded as a breach of the trade secret.
The information that makes up a trade secret will depend on the individual situations. However, unfair practices in respect of secret information include industrial or commercial espionage, breach of contract and breach of confidence.