Trade secrets have always been the foundation of innovation in Peru - intuitively and without much analysis. Although Peruvians only submitted 3,354 patent applications between 2010 and 2021, a much higher number of new products and services, as well as enhanced or updated versions, probably came to market during that time. How have these releases' inherent inventions and other developments been safeguarded?
Each of these launches undoubtedly involves the development of trade secrets, whether they are found in the underlying technology, the formulation, or the planning and design that lead up to the launch.
Over the years, as I've had the chance to provide advice on innovation projects or to visit businesses to learn about their newest products, I've been able to confirm how intuitively senior management has implemented procedures to manage the information it considers valuable, frequently essential for your trade, typically relying on highly trusted partners and employees.
In our nation, trade secrets have traditionally been handled in a trust-based manner without much plan or organization. But times do change. Today, workers acquire knowledge and experience that they fairly anticipate to bring with them to their next job or business venture. This is known as labor mobility. Greater accessibility to information and the quick transmission of data and images are both benefits and risks inherent to digitization.
Due to the lack of documentation and the small number of disputed cases, statistics on the management of trade secrets in Peru are not available. We only encounter situations where a secret is violated, disclosed, or used without authorization and the harmed owner decides to take legal action. Frequently, the secret's owner decides against filing a lawsuit.
Typically, allegations for unfair competition reflect complaints for trade secret infringement. Unless the acts of trade secret infringement are particularly obvious, as in the case file 0107-2019/CCD, this sort of complaint generally fails for lack of evidence to support the existence of the trade secret and the requisite preservation measures. Trade secret infringement has negative repercussions that extend beyond the party who is directly harmed:
When a third party exploits a company's trade secrets without authorization, it harms not only the owner of the information's competitive position but also discourages the development of more innovative products, which is detrimental to society as a whole. To put it another way, it engages in behavior that is inconsistent with the conduct that should govern the competitive process, committing an act of unfair competition insofar as it goes against the fundamental principle of commercial good faith that serves as the foundation for the regulation set forth in the Law for the Repression of Unfair Competition.
Trade secret violations can also take on criminal forms or manifest themselves in intellectual property litigation, for instance when a trusted person has acquired a right under their name. These are instances where trademarks, patents, or industrial designs are subject to oppositions or annulments based on the theft or illegal use of a trade secret, yet there are insufficient facts or circumstances to qualify the situation as a trade secret theft.
Classifying "everything" as confidential has been a common practice in this straightforward method of preserving trade secrets. Confidentiality agreements are signed and trusted positions are recorded in the belief that doing so will provide a shield of protection for all information that collaborators access.
The devil, though, is in the details. Not all information is confidential, and within what is, we must distinguish between various levels of relevance, classify the material, decide on access levels, and decide on the degree of diligence to be used.
Information must be classified, and access and protection levels must be governed, in order for work teams to communicate information effectively. The people who need access to the information in order to carry out their duties properly must have access to it.
This is how Mertz came to design and offer a service to address corporate needs to accurately identify their trade secrets, routinely audit and improve measures to protect their secrets' confidentiality, and make sure they can also provide adequate communication to their collaborators, both internal and external.
The development of intellectual property strategies that enable businesses to choose when to file for patents, how to expand the protection internationally, as well as how to combine them with other types of registrations that are available in the national and international regulations themselves—where, in addition, the trade secret could become a crucial component—is also becoming more and more important. Furthermore, the intangibles are strengthened through the protection of industrial designs, trademark registrations that encompass non-traditional marks such as those that are three-dimensional, audible, in motion, tactile, and others, and the protection of authorship rights for the collection of artistic creations that accompany the introduction and promotion of goods and services.
Returning to trade secrets, the most effective combination will be the strategic selection and rigorous protection of some elements as trade secrets, paired with the protection of some technical aspects as patents.
Mertz recognizes and oversees the protection of the collection of intangibles surrounding our clients' goods and services. To learn more about the trade secret service, ask for a customized presentation.