Trade Secret Infringement

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The success of a business could rely on a piece of information so simple, yet with exceptional economic value. For example, the perfect mix of herbs and spices has turned KFC from a small outlet into one of the biggest culinary franchises in the world. Meanwhile, Coca-Cola’s defining taste greatly benefitted them against their market competitors. As with anything else in life, with value comes a necessity to protect it —this is the idea behind Trade Secret protectionBecause of its potential, disputes and infringements regarding Trade Secrets between major companies are not rare. Thus the stipulations in Law no. 30/2000 on Trade Secrets reflect how highly regarded Trade Secrets protection for the market.

What constitutes Trade Secret Violation?

According to regulations in the Indonesian Trade Secret Law, there are two forms of Trade Secret infringement, they are:

  1. When a person deliberately discloses the Trade Secret or breaks the agreement, or the obligation, either written or not, to maintain the confidentiality of the relevant Trade Secret. (Article 13)

If we were to dissect this article, its key components are:

  1. Subjective
    1. deliberately (tort)

“Deliberately” in this context can be interpreted as purposefully intending or knowing, which could include:

  • The perpetrator purposefully wills the disclosure of a Trade Secret, purposefully wills the breach of an agreement, and/or for a written or verbal obligation to be infringed upon.
  • The perpetrator comprehends their actions.
  • The perpetrator understands that Trade Secrets are not to be disclosed to parties that they know they are not entitled to. The perpetrator understands that there is an agreement that has to be upheld. And understand that there are verbal or written obligations that must be followed.

Proving deliberateness may be a difficult and highly subjective task, but the process could be aided by analyzing the relevant objective factors. This includes the action, the object of the action, the instrument of the action, etc. Analysis of these facts can be the basis for concluding whether there was an element of deliberation in an action.

  1. Objective (Action and Object)
    1. discloses the Trade Secret or breaks the agreement, or  breaks the obligation, either written or not, to maintain the confidentiality of the relevant Trade Secret.”(Action)

Trade Secret, Agreement, Obligation, either written or not (Object)

If the formulation of an act consists of three acts, in which the object of each act is different, then it can be concluded that the act consists of three separate acts.

  • “Discloses the Trade Secret” includes all actions in any form and manner onto a Trade Secret that makes the Trade Secret known to other parties who had not known it beforehand. Examples include informing, discussing, sharing the trade secret in the form of documents and so on. This act may be considered to be completed, if another party now knows the Trade Secret because of the action. With the completion of the action, comes the completion of the infringement (voltooid).
  • “Breaks the agreement”  action is completed if there is an agreement, between two or more parties, regarding the maintenance of the confidentiality of a Trade Secret, in which the agreement was broken. To break an agreement is to do actions contrary to the agreement’s contents.
  • “Breaks the obligation, either written or not.” Action is completed if an agreement contains an obligation to do or not do, an act related to a Trade Secret. Then the obligation is violated by carrying out actions contrary to the agreement’s contents.


  1. A person shall be deemed to have committed an infringement on a Trade Secret of another party if he obtains or possesses the Trade Secret in a manner that is contrary to the prevailing laws and regulations. (Article 14)

When dissected, components in this stipulation are as follows:

  1. Objective
    1. obtains or possesses” (action)

Obtaining or possessing, in this context, can be defined as a single act, because by their nature, these two acts cannot stand alone. Obtaining/possessing can be defined, as acts that, in any form or manner, against an object that was originally outside his control, which transfers the object to their control directly and absolutely. Thus, the act will be considered complete if the object is transferred to the perpetrator. An object can be considered “transferred”, if the perpetrator can directly utilize the object without the need to do other actions beforehand. This act may manifest in multiple forms, such as stealing files containing Trade Secrets, reproducing or distributing documents containing Trade Secrets without authorization, and so on.

  1. “a manner that is contrary to the prevailing laws and regulations.” (action)

This is a component that is attached to an action. It can be proven by presenting laws or regulations violated in obtaining and controlling a Trade Secret. The regulations in question do not have to be from Law No. 30/2000, but they may also come from other existing legal provisions, such as government regulations, ministerial regulations, and others. This component must be present for an act of obtaining or possessing to be unlawful.

  1. Trade Secret of another party” (object)

This component must also be proven, because to prove the unlawful nature of the act of obtaining and possessing, it must be proven that the Trade Secret obtained or possessed by the perpetrator rightfully belongs to another party.


Criminal Provisions in Trade Secret Protection

Trade Secret infringement is regarded as a very serious crime by Indonesian Law. As stipulated in Article 17 of Trade Secret Law, any person who deliberately and without rights uses the Trade Secret of another party or conducts any acts as referred to in Article 13 or Article 14 shall be sentenced to imprisonment of at most two years and/or a fine of at most three hundred million rupiahs. Partners, especially business owners, ought to be very careful in dealing with other parties’ trade secrets.

Trade Secrets, like any other form of intellectual property, are the result of a great deal of hard work, research, and brainstorming. If an idea or work, or in this case, a trade secret, can bring significant profits, then we should respect the rights of the Trade Secrets owners as those who are entitled to that economic value. Respecting intellectual property rights is a manifestation of our appreciation towards the side of the human soul that produces creativity, innovation, and invention.

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Law  No. 30/2000 on Trade Secret

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