New Trade Secret Legislation in France? Mais oui bien sûr!

If your trade secrets get stolen in France, what protections would you have?  Most U.S. trade secret lawyers don’t have occasion to consider trade secret laws outside the United States, but there’s a whole world beyond the Uniform Trade Secrets Act!  Other countries also recognize the value of trade secrets and have taken steps to protect them.

For the first time in France, the National Assembly adopted a bill aimed at criminal sanctions for trade secret disclosure.  This bill, called the “Proposition de loi visant à sanctionner la violation du secret des affaires,” recognizes that the financial value of a company depends more and more on ideas, know-how, and trade secrets that give companies an edge over their competitors.  The bill imposes penalties of up to three years’ imprisonment, individual fines of up to €375,000 and corporate fines up to €1.875 million for the disclosure of trade secrets.  These penalties aren’t as stiff as the U.S.’s Economic Espionage Act, which was recently amended to increase individual fines up to USD $5 million and corporate fines up to USD $10 million or three times the value of the stolen trade secret to the organization, but traditionally France provides for lower fines than the United States. Complementary corporate sanctions such as liquidation of the company, disqualification from public tenders, etc. will certainly be provided for in the final bill.

France doesn’t currently have any comprehensive law governing trade secret misappropriation.  Protecting trade secrets in France is only possible through tortuous routes such as criminal offenses for robbery, for breach of confidence, violation of professional or banking secrecy, or civil claims for unfair competition, or breaches of employment or IP legal requirements.  These routes work, but they lack specificity.  It’s not straightforward for companies doing business in France to prevent their competitors from stealing and using their trade secrets.  Given the importance of trade secrets in a competitive marketplace, and the gap in French law for dealing with trade secret violations head-on, this bill was well received.

The bill is currently under review by France’s Senate, and it remains to be seen whether it will be adopted.  And even if it’s adopted, there’s still a long way to go.  The penalties seem light in cases where the stolen trade secrets are worth millions of dollars/euros, and France doesn’t yet have a dedicated legal regime dealing with civil and commercial actions for trade secret violation.  But it’s a step in the right direction.  Hopefully we’ll see this bill pass bientôt!