Trade secrets became explicitly protected under Spanish national law when EU Directive (2016/943/EU) became part of Spain law in 2019. A trade secret in Spain is now defined as secret information, unknown to those who usually handle such kinds of information and not readily accessible. This information also must have commercial value precisely because it is secret. Lastly, the party asserting its trade secret rights to the information must have done what it could to reasonably keep its trade secret information a secret. In other words, Spain’s trade secret law now lines up with much of the rest of the developed world. See e.g. the United States’ Uniform Trade Secrets Act.

Spain’s trade secret law creates economic value for companies that hold trade secrets and it has already helped to promote and increase innovation by Spanish companies. Investments made by Spanish companies in research and development will not only be protected, they will be a factor in company competitiveness and value. This is also true for foreign companies that pursue innovation in Spain or in tandem with Spanish companies.

As mentioned above, for a company to be able to invoke the protection of Spain’s new trade secret law, it must have made reasonable efforts to keep the information secret. Fulfilling this “reasonable effort” requirement will be important for companies and they must set up policies and procedures and engage in best practices for doing so.

Spain’s trade secret law also impacts employee contracts as the failure to have trade secret protection provisions in your employee contracts may be construed by Spanish courts to mean that you did NOT make reasonable efforts to protect your trade secrets. If your existing employee contracts with your Spain employees do not explicitly make clear that they are never to reveal (or even put at risk) your company’s trade secrets, you should consider revising your employment contracts now. You should also consider adding trade secret protection language to any of your other contracts — especially your vendor agreements — with any company that may gain access to your trade secrets.

Spain took a big step in establishing a strong system for protecting trade secrets. Your company now must take the next step to ensure that it does not fall prey to it.

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