Along with intensifying international competition, there is a growing risk of trade secret infringement by overseas competitors.

Theft of trade secrets across national borders constitutes a loss of national wealth, leading to the deterioration of Japan's industrial competitiveness. However, Japan lags behind other countries in effective measures covering this field. Immediate review of the current measures against the issue is required.

(1) Enactment of new law intended to protect trade secrets

The Unfair Competition Prevention Act, the current law governing the protection of trade secrets, includes various types of regulations with different purposes and therefore does not effectively convey the significance of the matter. In order to clearly demonstrate an uncompromising attitude against infringement of trade secrets, a new law solely dedicated to the protection of trade secrets should be enacted at next year's ordinary Diet session. In addition, it is also necessary to review the current law in terms of insufficient provisions against trade secret infringement, such as lenient fines compared with other countries and a lack of rules to impose severe punishment on overseas criminals.

(2) Improvement of operation through the revision of Trade Secrets Management Guidelines

In order for a company to be protected by Unfair Competition Prevention Act, it is required to ensure "confidentiality management," which has not been easy to prove that a trade secret has been violated. The Trade Secrets Management Guidelines, defined by the Ministry of Economy, Trade and Industry, should clearly indicate realistic minimum requirements for companies with respect to proper confidentiality management.

(3) Early establishment of Public-Private Forum and its effective operations

The Ministry of Economy, Trade and Industry is currently thinking about establishing a "Public-Private Forum" proposed by Keidanren. It is hoped that the forum will be established soon. Also, by incorporating effective practices of other countries, a wide range of relevant agencies and institutions including the police should be involved in this forum to provide one-stop services.

"Trade secrets" mean technical or business information useful for business activities, such as manufacturing or marketing methods, that is kept secret and that is not publicly known.