On 17 December 2018 the Restriction of
Unfair Competition and Protection of Business Secrets Act (RUCPBSA) has entered into force in Estonia, one of the
goals of which is to bring Estonian law into conformity with the EU directive
on the protection of trade secrets.
The explanatory memorandum to the bill indicates that
there is nothing new in the definition of business secrets as the Supreme Court
has given similar meaning to the definition of business secrets in its previous
case law. It is noteworthy that the definition of business secrets set out in
the Act is rather general and may be difficult to understand for people with no
legal knowledge. According to the RUCPBSA, a business secret is information
that meets the following requirements:
The bill points out that irrespective of the contents
or nature, information can only be considered a business secret if it complies
with all three of the requirements set out in subsection 5 (2) of the
Act based on the bill. Thus, on the basis of this definition each undertaking
must consider what the information related to their company is that has
commercial value and that is subject to measures by the undertaking to keep it
secret. Arising from the above, every piece of information related to a company
does not constitute a business secret.
The correct definition of a business secret is also
significantly affected by the circumstance that unlawful acquisition, use or
disclosure of business secrets can be subject to both civil and criminal
However, the RUCPBSA contains an exception of the
so-called whistleblowing. The acquisition, use or disclosure of a business
secret is not deemed unlawful if it is necessary to reveal unlawful acts for
the purpose of protecting public interests; enable employees to protect their
rights and interests through the representative of employees, provided that the
disclosure of a business secret by an employee to a representative is necessary
for exercising the functions within the competence of the representative; or
protect a recognised legitimate interest.
The advisors of the Tax and Legal Advice Department of LEINONEN Tallinn office can provide advice to companies in this area, assistance in establishing the definition of business secrets in a company and consultation upon implementing effective measures to protect the business secrets.
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