EU Parliament urged to reject trade secrets directive

Written by Martin Banks on 1 April 2016 in News
News

Proposed EU legislation on "trade secrets protection", which Parliament votes on this month, creates "excessive rights to secrecy for businesses", according to a leading campaign group.

Corporate Europe Observatory, a Brussels-based group, says the draft law is a "direct threat to the work of journalists and their sources, whistleblowers, employees' freedom of expression, and rights to access public interest information."

A coalition of civil society groups, citizens and journalists are now urging MEPs to reject the trade secrets directive in the parliamentary vote, scheduled for 14 April.

Ahead of a debate in Parliament on the issue on 13 April, the pan-European coalition has sent MEPs a "critical analysis" of the proposed legislation and have also launched a petition against the directive.


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Trade secrets are everything companies keep secret to stay ahead of competitors. 

They can range from a secret recipe or manufacturing process and plans for a new product, to a list of clients and prototypes.

The theft of trade secrets can pose a major problem for companies, and is already punished in all member states. 

For example, in January 2015 the French government introduced a penalty of up to three years in jail and €375,000 fine for a violation of trade secrets.

So far, however there has been no uniform legislation on the matter at EU level.

The coalition say that the definition of trade secrets the directive foresees is "so broad that almost all internal information within a company can be considered a trade secret."

It will put anybody revealing such information without the company's consent at risk, according to the alliance.

Journalists, say the coalition, will be "directly impacted" by the directive.

"Legal harassment of media by private companies and wealthy individuals using defamation laws is already widespread, they will now be able to use trade secrets protection as an additional argument," says CEO.

Patrick Kamenka, from the French National Union of Journalists, said, "Citizens, journalists and scientists sometimes also need to have access to and publish this information to defend the public interest."

He adds, "They could now face legal threats, years in prison and heavy fines worth hundreds of thousands of euros for doing so, as Antoine Deltour and Edouard Perrin in the 'LuxLeaks' affair. 

The documents which caused 'Luxleaks', the name given to a financial scandal in Luxembourg, were contracts between Luxembourg and multinational companies, and, from the point of view of Luxembourg, legitimate since most EU countries are also engaged in such dealings to attract multinationals. 

As a consequence, says the coalition, the whistleblower and the journalist who exposed the scandal and who are being prosecuted in Luxembourg for trade secrets violations would not be protected by the new directive.

"This is despite the fact that they revealed a major tax evasion scandal harming all European tax payers," says CEO.

"This," said Kamenka, "effectively prevents people reporting corporate misconduct or wrongdoing. Which media editor can afford to take the risk of financial ruin?"

"It gets worse. If the directive is approved at the European level, member states will be able to go further when they adapt it into national law - and be lobbied by industry all over Europe to do so."

Further reaction came from Martin Pigeon from Corporate Europe Observatory, who warned, "This is not going to be an easy battle."

"Multinational corporations have been lobbying for this directive for years and heavily influenced the text while the general public hardly knows anything about it."

"The text can today no longer be changed. We call on the European Parliament to reject it."

He added, "We think it is essential that MEPs reject it and ask the Commission to come up with a better one. But they are under heavy pressure from multinational corporations to adopt it."

About the author

Martin Banks is a Brussels-based freelance journalist

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