Certain Provisions on the Prohibition against Acts of
Infringement on Business Secrets
Promulgated by Order No.41 of the State Administration of
Industry and Commerce on November 23, 1995

Article 1

With a view to preventing the acts of infringement on business secrets, safeguarding the lawful rights and interests of the owners of business secrets and preserving the order of the socialist market economy, and according to relevant provisions of the Law of the People's Republic of China for Countering Unfair Competition (hereinafter referred to as the Law for Countering Unfair Competition), the Provisions are formulated.

Article 2

"Business secrets" in the Provisions refer to the technical information and operational information which is not known to the public, which is capable of bringing economic benefits to the owners of the rights, which has practical applicability and which the owners of the rights have taken measures to keep the secrets.

"Information which is not known to the public " in the Provisions refers to information which can not be obtained directly through the public channel.

"Information which is capable of bringing economic benefits to the owners of the rights , which has practical applicability " in the Provisions refers to information which has certain applicability and can bring practical or potential economic benefits or competitive advantages to the owners of the rights.

"Measures taken by the owners of the rights to keep the secrets" in the Provisions include the conclusion of an agreement on the protection of the secrets, formulation of security systems and other reasonable measures to maintain secrecy.

"Technical information and operational information" in the Provisions includes information for design, programme, product ingredients, manufacturing process, manufacturing method, management know-how, list of clients, or information on the supply of goods, production and marketing scheme, tender base for inviting tenders or making tenders and contents of the tender paper.

"The owners of the rights" in the Provisions refer to any citizen, legal person or other organization who has the legal rights of ownership or use over the business secrets.

Article 3

The following acts of infringement on business secrets shall be forbidden:

1. Obtaining business secrets from the owners of the rights by stealing, promising of gain, resorting to coercion or other illegitimate means;
   
   
2. Disclosing, using or allowing others to use business secrets of the owners of the rights obtained by the means mentioned in the preceding section;
   
   
3. The organization or individual who has business relations with the owners of the rights discloses, uses or allows others to use the business secrets of the owners of the rights that it/he has obtained in breach of the contractual agreement or disregarding the requirement of the owners of the rights to preserve the business secrets;
   
   
4. Employees of the owners of the rights disclose, use or allow others to use the business secrets of the owners of the rights that they have obtained in breach of the contractual agreement or disregarding the requirement of the owners of the rights to preserve the business secrets.

Where a third party obtains, uses or discloses business secrets of others when it/he has or should have full knowledge of the illegal acts mentioned in the preceding section, it/he shall be deemed to have infringed on the business secrets of others.

Article 4

Acts to infringe on business secrets shall be ascertained and prosecuted by the competent authorities for the administration of industry and commerce at the level of the county or above.

Article 5

Where an owner of the rights (Applicant) who considers that its/his business secrets are infringed on applies to the competent authorities for the administration of industry and commerce for the investigation and prosecution of the infringing acts, it/he shall provide relevant evidences to prove the existence of the business secrets and infringing acts

The organization and individual under investigation (Respondent) as well as the interested parties and witnesses shall truthfully provide the competent authorities for the administration of industry and commerce with relevant evidences.

Where the owner of the rights is able to prove that the information used by the Respondent are uniform or identical with its/his business secrets and, at the same time, is able to prove that Respondent has the condition to obtain its/his business screts, while Respondent is unable or refuses to provide evidences which prove that the information used by it/him is legally obtained or used, the competent authorities for the administration of industry and commerce may ascertain that Respondent has committed the acts of infringement on the basis of relevant evidences.

Article 6

Where Respondent's acts of disclosing, using and allowing others to use business secrets of others in violation of the law will cause irrecoverable losses to the owner(s) of the rights, the competent authorities for the administration of industry and commerce may take the following measures at the request of the owner(s) of the rights with the written guarantee voluntarily issued by the owner(s) of the rights undertaking to bear the responsibility for the consequences of the compulsory measures:

1. To detain drawings, software and other relevant material carrying business secrets of the owners of the rights obtained by Respondent by unfair means;
   
   
2. To order Respondent to stop selling the products produced by using the business secrets of the owners of the rights.

Article 7

For those who violate Article 3 of the Provisions, the competent authorities for the administration of industry and commerce shall order them to desist from the illegal acts and may punish them by imposing, according to circumstances, a fine of more than RMB���10,000 and less than RMB���200,000 in accordance with the provision of Article 25 of the Law for Countering Unfair Competition.

When making a punishment in accordance with the provision of the preceding paragraph, the competent authorities for the administration of industry and commerce may dispose the infringing articles in the following ways:

1. To order and supervise the infringer to return to the owners of the rights the drawings, software and other relevant material carrying the business secrets.
   
   
2. To supervise the infringer to destroy the products which have been produced by using the business secrets of the owners of the rights and will make the business secrets public once sold in the market, except that the owners of the rights agree to dispose them in other ways such as buying or selling .

Article 8

In case an infringer refuses to perform the punishment decision and continues to commit the acts listed in Article 3 of the Provisions, it/he shall be deemed as having committed new illegal acts and shall be punished in severity.

Article 9

Where the owners of the rights request the competent authorities for the administration of industry and commerce to conciliate for damages, the competent authorities for the administration of industry and commerce may conduct the conciliation. The owners of the rights may also directly institute proceedings in the people's court for claims.

Article 10

State organs and the civil servants shall not disclose or allow others to use the business secrets of the owners of the rights in the performance of their public duties. When supervising and inspecting the acts of unfair competition of the infringement on business secrets, the staff members of the competent authorities for the administration of industry and commerce handling the case shall keep confidential the business secrets of the owners of the rights.

Article 11

The State Administration of Industry and Commerce shall be responsible for the interpretation of the Provisions.

Article 12

The Provisions shall enter into force as of date of promulgation.