IP research paper reveals the importance of trade secrets

  • 1 September 2014
Intellectual Property

The contribution of trade secrets to knowledge diffusion and collaborative innovation is the focus of the latest intellectual property research paper from the International Chamber of Commerce (ICC).

“Trade secrets: tools for innovation and collaboration” is the third installment in a research paper series produced by the ICC Commission on Intellectual Property. The five-paper series explores how intellectual property (IP) interacts with decisions, transactions and processes related to technology development and dissemination.

The latest paper, prepared by external researchers Jennifer Brant and Sebastian Lohse, aims to inform policymakers about shortcomings in existing frameworks for trade secret protection, which can undermine cross-border collaboration. It comes amid growing awareness among companies of their vulnerability to the theft of confidential business information.

In the US, federal cases of trade secret theft doubled between 1995 and 2004, and are expected to double again by 2017. At the same time, in EU countries some 20% of respondents to a recent survey reported having experienced at least one attempt or act of misappropriation over the past 10 years.

Daphne Yong-d’Hervé, Chief Intellectual Property Officer at ICC, said: “Our new research paper explains what trade secrets are, then looks into the challenges that companies face in managing trade secrets in the real economy. It also suggests some actions that companies and legislators could take to ensure confidential business information can be effectively protected and managed.”

The ‘crown jewels’ of intellectual capital

“Trade secrets are often the ‘crown jewels’ of a firm’s intellectual capital, developed over many years of experience and trial and error,” explained David Koris, IP Commission Chair and General Counsel of Global IP in Shell. “Many of the complex technical problems today require a collaborative approach toward innovation. Often a broad array of confidential business and technical information may need to be shared. Companies need to foster a culture which links the value of technology and IP, such as trade secrets, to the economic objectives of a business plan. They then need a strategy to manage the development of the IP.”

“These actions go a long way to providing the discipline necessary to achieve business plan objectives while reducing risk when sharing knowledge with partners in an open, collaborative manner,” he added.

The first two papers in the IP and Innovation series, launched in October 2013, addressed how small- and medium-sized enterprises could improve their performance through better management of intellectual assets, and the role of open innovation.

Due for release later this year, the final two papers will explore issues relating to the evolving geography of innovation, and diffusion channels for technology and know-how.

ICC Commission on Intellectual Property