ANALYZING THE IMPACT OF A CODIFIED TRADE SECRETS ACT ON INDIAN BUSINESS

Abstract

A trade secret is confidential business information that has commercial value. Its owner keeps it secret and does not share it with anyone who is not authorised to receive it. Examples include a method of making a product, account records and business strategies. Like trademarks, copyrights, designs and patents, a trade secret is a creation of the human mind, so it also deserves legal protection.

In India, it is fairly easy for a business to take another business’s confidential methods, recipes or strategies and use them as its own. This has become common because of growing unhealthy competition among small and medium enterprises (SMEs). Such practices encourage unfair trade and let some businesses exploit the work of others. This harms the growth of the country. In line with the Sustainable Development Goals, trade secrets should be protected as a form of intellectual property.

India has no single law on trade secrets, so courts deal with these cases in different ways. Some courts treat them under the Indian Contract Act, 1872, some apply principles of equity, and others treat them as a common law claim for breach of confidence. Trade secrets are also often confused with other forms of intellectual property, especially patents. Article 39.2 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) requires that secret information with commercial value be protected. This paper examines the effects of the Uniform Trade Secrets Act (UTSA) adopted in the USA and the effects of India not having a specific law.