Serbia Adopts New Trade Secret Law

The new trade secret protection law, which harmonizes Serbian legislation with Directive (EU) 2016/943 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, entered into force in Serbia on June 5, 2021.

Under the new law, in order for information to be considered a trade secret, it needs to:

• Have commercial value because it is not generally known or easily available to third parties who normally come into contact with this type of information;
• Be protected by its holder by appropriate measures in order to preserve its secrecy.

The new definition expands the scope of information that is considered a trade secret. Under the old trade secret law, trade secret was defined as information that had commercial value because it was not generally known or available to third parties that could gain economic advantage from its use and also as information that could harm its holder if disclosed to third parties.

In order for a trade secret to enjoy legal protection under the new law, trade secret holders must adopt internal acts on the protection of trade secrets and undertake other prescribed protection measures, such as using the label “trade secret” on confidential documents, restricting access to the premises or files where confidential information is located and concluding confidentiality agreements with persons who may have access to trade secrets.

Under the new law, foreign trade secret holders have the same rights as domestic ones only if this protection arises from international agreements applicable in Serbia or from the principle of reciprocity. The previous law did not distinguish between foreign and domestic holders.

Previously, the disclosure of a trade secret was not considered misappropriation only if it was done in order to reveal an act punishable by law. Under the new law, a trade secret can be disclosed under certain conditions in the following cases:

• For the purpose of exercising the right to freedom of expression and information;
• For the purpose of disclosing criminal acts and other illegal acts;
• For the purpose of protecting the rights under a law governing a specific subject matter (lex specialis);
• When employees disclose trade secrets to their representatives in the performance of their official duties;
• In connection with the provision of legal assistance by a lawyer.

The new law also introduces the following novelties in civil proceedings for trade secret misappropriation:

• Longer deadline for filing a lawsuit – the deadline is now one year (as opposed to six months under the previous law) from the day on which the plaintiff learned of the misappropriation, and a maximum of five years (as opposed to three years under the previous law) from the day of the misappropriation;
• Special delivery rules to protect secrecy;
• New rules for calculating damages;
• The possibility of filing a lawsuit against an intermediary, i.e. a person who provides services that a third party uses in acts of the misappropriation or imminent misappropriation of a trade secret.

Finally, criminal provisions have been expanded – in addition to fines for legal entities, the new law introduces fines for entrepreneurs and natural persons.

By: Djordje Marković

For more information, please contact Djordje Marković at our Serbia office.