Study On The Covenant Not To Compete For Trade Secrets Protection

In rapidly developing information era,the leaking of of trade secrets caused by talent flow attracts more and more attention .With the former employer's trade secrets grasped by resigned employee taking competing interests to new employers,at the same time,the former employer is facing an unprecedented threat of competition. Trade secrets is a kind of unregistered intangible assets,its basic characteristic is secrecy.the present judicial relief measures usually play very small role. As a precautionary measure,it is obvious that the covenant not to compete is placing an important role in trade secrets protection. At the same time the enforcement of the covenant not to compete will impose on the employee's rights to freely work. The critical problem is how can we find a proper balance between trade secret right and the resigned employee's rights to freely work.In order to realize the value of the system,we must coordinate the conflict of intrest between resigned employee and the holder of the trade secret. At present, there are not any overall and systematic rules about the covenant not to compete in our country's national legislation. Moreover, the current regulations are so imperfect that they can't fit in with the needs of the society. As a result of that,people's lawful interests can't be safeguarded to the fullest extent.This thesis begins with the basic question of the protection of trade secrets,admits the necessity of the covenant not to compete for trade secrets protection;analysis its concept,legal characteristic,theoretical foundation;introduce the legislation and judicial practice of foreign countries about the covenants not to compete, point the purpose and the contents of the covenant not to compete for trade secrets protection must accord with the criteria of legalization and reasonableness;at last,the author puts forward many perfection proposals from three aspects according to the defects of current regulations.This thesis is divided into five parts.The first part is the basic question of trade secret and the covenant not to compete.At first,the part points the protection of trade secrets need reasonable covenant not to compete through analysising the concept and components of trade secrets.Secondly,the author discusses its concept,theoretical disputing problems,legal characteristic emphatically.In addition,this part explores the theoretical foundation from legal theoretical and economics perspective. There are several advantages which use covenant not to compete for trade secret protection. At last,it is concluded that covenant not to compete is necessary for trade secrets protection.The second part studies the foreign legislation and judicature practice of covenant not to compete and makes a detailed discussion. American holds diverse perspectives,and Germany stressed the importance of protecting the rights and interests of laborers. We should learn foreign advanced experience and rebuild our own system of covenant not to compete.The third part gives a detailed interpretation on how to recognize a covenant not to compete as reasonable according to theoretical analysis and comparative study. As to the specific criteria of rationality,this chapter takes seven aspects into consideration.The fourth part is focus on the civil liability resulting from breach of the covenant not to compete for trade secrets protection. At first,the author discusses the critical point when the judicial powers intervene in. The civil liability occurred when the employee breaks the covenant not to compete and conduct competitive business which is prohibited. Once the resigned employee violates the mentioned obligation,employer may claim for stopping infringement,penalty and liquidated damages.The fifth part is the legal consideration of the covenant not to compete. There are not any overall and systematic rules about the covenant not to compete for trade secrets protection in our country's national legislation; the regulations of the effective conditions are not specific; the judicial relief measures are lack of application. At last the author puts forward several perfect proposals from the aspects of legislation,jurisdiction,management of enterprise according to the defects of current regulations.