Protecting your competitive advantage

A trade secret is, broadly speaking, any confidential business information which provides a business with a competitive advantage. The precise definition of a trade secret varies depending on the specific laws of a country. However, the following three factors are generally common to all such definitions:

  • The information is not generally known to the public
  • It confers some sort of economic benefit on its holder
  • It is the subject of reasonable efforts to maintain its secrecy

The following types of information are often considered trade secrets:

  • Unpatented inventions
  • A special recipe or chemical formula
  • Methods of doing business, techniques, and training manuals
  • Marketing and customer information

Unlike patents or trademarks, a trade secret is a type of intellectual property for which the holder does not seek registration or a grant from the Canadian Government. Currently, no province in Canada has enacted any special trade secret legislation. Trade secrets are therefore protected primarily by common law in Canada, with the exception of the province of Quebec. In Quebec, there are a few articles in its civil code which address some aspects of trade secrets.

The primary rule for trade secret protection is that the trade secret must really be a secret. It must be information that is not generally known to the public and would not be ordinarily available to competitors. The greater the degree to which the information is disseminated to others, the less likely it will be a protectable trade secret. Therefore, business owners should be very careful about the type of information that they provide to outsiders. Unless a trade secret owner takes diligent steps to try to preserve the secrecy of its information, courts may be reluctant to provide assistance to that owner if others learn about it.

If you have any questions regarding the protection of your trade secrets, please click here to send us an email. Alternatively, call us at 613-238-8080 or in Canada toll free at 888-565-9912.