Trade secrets were traditionally protected by the common law of confidence, which required three elements: (1) the information must have a quality of confidence; (2) the information was imparted in circumstances importing an obligation of confidence; and (3) there was an unauthorized use of the information to the detriment of the party communicating it. Since 2018, UK law must comply with an EU Directive that defines a trade secret as information that is secret, has commercial value because it is secret, and reasonable steps have been taken to keep it secret. This new definition differs from the common law in requiring trade secret owners to take active steps to preserve secrecy of the information.

1. Trade Secrets
Jane Lambert1
Until 9 June 2018 trade secrets were protected by the law of confidence. This was a doctrine developed by the
judges over the years. It was summarized as follows by Mr Justice Megarry in ​Coco v AN Clark (Engineers) Ltd.
:2
“In my judgment, three elements are normally required if, apart from contract, a case of breach of
confidence is to succeed. First, the information itself, in the words of Lord Greene, M.R. in the ​Saltman
case​ on page 215, must “have the necessary quality of confidence about it” . Secondly, that information
must have been imparted in circumstances importing an obligation of confidence. Thirdly, there must be
an unauthorised use of that information to the detriment of the party communicating it.”
Since 9 July 2018 our law has had to comply with Directive (EU) 2016/943 of the European Parliament and of the
Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets)
against their unlawful acquisition, use and disclosure. Art 2 (1) of the Directive defines a trade secret as:
“information which meets all of the following requirements:
(a) it 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;
(b) it has commercial value because it is secret;
(c) it has been subject to reasonable steps under the circumstances, by the person lawfully in control of
the information, to keep it secret.”
That is different from the traditional common law formulation in that it requires the trade secret owner to take
steps to preserve the secrecy of the information,
1
Barrister, 4-5 Gray’s Inn Square, London, WC1R 5AH, Tel 020 7404 5252, jane.lambert@nipclaw.com
2
1968] 7 WLUK 2; [1968] F.S.R. 415; [1969] R.P.C. 41;