Overview of trade secrets in Laos

Trade secrets in Laos are a factor that helps businesses create unique products and services that are different from competitors, thereby attracting customers and increasing revenue. Protecting trade secrets in Laos plays an extremely important role in promoting the sustainable development of the economy. The protection of proprietary information helps businesses create competitive advantages, attract investment, encourage innovation and prevent unfair competitive behaviors. When trade secrets are protected, businesses will be motivated to invest in research and development, create new and unique products and services, contributing to improving the competitiveness of the economy. At the same time, the protection of trade secrets is also a way to protect the legitimate interests of businesses, avoid economic and reputational losses. Viet An Law would like to guide customers on how to protect trade secrets in Laos through the article below.

Overview of the definition of trade secrets in Laos

Trade secrets are information that is important to your business and is not publicly available or easily accessible to the public. A trade secret must also provide some economic benefit or advantage to its owner, and the person who controls the information must make reasonable efforts to maintain its confidentiality.

In Laos, a trade secret is defined under intellectual property law as “confidential information in the sense that it is not known or easily accessible by people in circles who regularly handle that type of information, such as: recipes, production processes, etc  or any information that has commercial value because it is confidential.” The Lao IP Law also stipulates the conditions for information to be understood as a trade secret. Accordingly, the information must:

• Is secret and known only by a limited group of people;
• Have commercial value; and
• Be asked by the owner of such information to take specific actions to keep the information confidential.

Overview of owners’ rights to trade secrets in Laos

• Right of Use and Disclosure: You have the freedom to decide on the use and disclosure of your trade secrets. You can share this information with people you trust and allow them to use it with your consent.
• Right to prevent unauthorized use: If someone uses your trade secret without permission, you have the right to prevent this behavior. You can take them to court to claim damages and stop them from continuing the violation.
• Right to Transfer: You have the right to transfer your trade secrets to others, such as selling, giving, or licensing. However, when transferring, you need to make sure that the recipient will keep this information confidential.

Overview of acts of infringement of trade secrets in Laos

• Disclosure of Confidential Information:
  • Intentionally or unintentionally disclosing confidential information to unauthorized outsiders.
  • Use confidential information to serve personal or other people’s interests.
• Unauthorized use of confidential information:
  • Using confidential information to produce and trade similar products and services.
  • Using confidential information to compete unfairly with the owner.
• Appropriation of confidential information:
  • Stealthily stealing, copying confidential information.
  • Buying, selling, and exchanging confidential information illegally.
• Other acts:
  • Expand the scope of use of confidential information beyond the permitted limits.
  • Dismantling and analyzing products and services to obtain confidential information.

Legal consequences of infringing on trade secrets

• Administrative penalties: Fines, temporary suspension of business activities. According to Lao intellectual property law, any person, legal entity or organization that knowingly infringes can be fined between 1% and 5% of the total value of the damage that has occurred
• Civil penalty: Compensation for damage must be paid to the owner of the trade secret. In addition, those who commit acts of counterfeiting, deception, fraud or unfair competition can be sentenced to imprisonment from three months to two years and fines ranging from 500,000 LAK (about 60 USD at the February 2017 exchange rate) to 10 million LAK (about 1220 USD)
• Criminal penalties: In case of serious violations, criminal liability may be prosecuted.

Some questions about the protection of trade secrets in Laos

How do I protect my trade secrets in Laos?

Under Lao IP law, you are exempt from the obligation to register and have the right to protect your trade secrets without registration. To protect the confidentiality of that information, you may disclose, disseminate, or provide access to it to a very limited number of people. Alternatively, a non-disclosure agreement in writing will legally ensure the confidentiality of the information that needs to be protected.

How long will my trade secrets be protected?

Trade secrets are protected indefinitely, as long as they remain confidential.

What exceptions are there when it comes to trade secret infringement?

According to regulations, the following acts are not considered violations:

• Reverse engineering or product analysis: Disassembling a product to learn its structure, operating principles, or performing laboratory experiments is not a violation.
• Legally obtained information: If an individual obtains information without knowing that it is a trade secret or has no obligation to keep it confidential, this behavior is also not considered a violation.