Trade Secret Protection in Malaysia

Trade Secret Protection in Malaysia

What are trade secrets?

Trade secrets are intellectual property rights on confidential information which may be licensed or sold. Any type of confidential information that gives your business a competitive advantage and is undisclosed to third parties is eligible for trade secret protection. Such information may entail technical information, such as research and engineering data, engineering drawings, process sheets, computer software source code, and commerical information, such as marketing strategy, production data or recordings regaring commercial activity.

Trade Secrets In Malaysia

In Malaysia, the term ‘trade secrets’ is interchangeable with ‘confidential information’, with the latter term recognised officially in Malaysian law. Trade secrets are not eligible to be registered in Malaysia, however one can take legal action against others should their trade secret(s) be exploited.

Eligibility for Trade Secrets

Eligibility to be recognised as a trade secret is as follows:

  1. It must be confidential information. Your information must only be known to a limited number of people involved, must not be previously disclosed to the public and must not exist in the public domain.
  2. It must be made clear to be a trade secret. You must make it reasonably clear to all parties involved that the information disclosed is considered to be a trade secret. Should there be no indication that the information disclosed is a trade secret, then the information may not be protected as such.

Term of Protection for Trade Secrets

Unlike most other forms of intellectual property, trade secrets are not protected according to a set amount of time. Trade secrets are protected as long as it consistently meets the eligibility for being a trade secret. If your trade secret is no longer confidential information, then it is no longer a trade secret and as a result it will not receive the same legal protection as it did prior to existing in the public domain.

Preparing for Trade Secret Protection

To protect trade secrets, confidentiality agreements, clauses or non-disclosure agreements (NDAs) should be organised by the employer to prevent employees from revealing confidential information to competitors, either during or after the period of employment at the company. It is also advised to draw up confidentiality agreements with contractors, suppliers, inventors relevant to the business. Owners of trade secrets may consider establishing confidentiality agreements or NDAs with the relevant parties prior to disclosing any knowledge as to prevent compromising the integrity of the trade secret.

In Malaysia, trade secret protection is enforced through legally binding contracts and not goverened by a specific legislation. For this reason, the process of challenging a third party who you believe to have had infringed upon your trade secrets will be taken through via regular Malaysian courts instead of the Malaysian Intellectual Property court.

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Trade Secrets, WIPO

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