Evidentiary Burden Shift Mechanics under Anti Unfair Competition Law Article 32
Article 32 shifts the burden to the defendant once the plaintiff proves proprietary protection measures and substantial identity with access.
Confidentiality Measures
Meaning
Contractual provisions, physical access restrictions and digital containment protocols implemented across commercial facilities safeguard proprietary business information against unauthorized disclosure or theft. Under the Anti-Unfair Competition Law of the People’s Republic of China, confidentiality measures constitute an indispensable statutory requirement for technical drawings, operational formulae and customer matrices to qualify for legal protection as trade secrets. Information that lacks identifiable safeguards loses trade secret status entirely, irrespective of commercial value.
Statutory Threshold
Chinese judicial interpretations require evidence that the rights holder established proportionate, reasonable protective steps suited to the commercial value of the asset. Acceptable confidentiality measures under judicial review include marking paper designs with non-disclosure legends, securing tooling workshops with biometric access gates and binding relevant personnel through non-disclosure agreements. Merely executing a generic employee non-compete clause does not satisfy statutory requirements if the company permits external factory visitors unrestricted access to assembly layouts.
Operational Protocols
Manufacturing facilities partition production zones into security tiers to prevent unauthorized inspection of custom assembly tooling. Restricting cellular handsets with integrated cameras, encrypting numerical control code files and implementing watermarked display terminals restrict unauthorized reproduction by shift operators. Segregated digital networks isolate computer-aided design repositories from external supply chain interfaces.
Periodic security audits by compliance officers verify that departing engineering personnel surrender all localized drives, security tokens and plant access badges before signing statutory release instruments.
Evidentiary Burden
Judicial disputes over misappropriated engineering drawings turn on whether protective procedures remained active prior to an infringement event. Courts assess whether the owner tracked document circulation logs, maintained encrypted server access records and actively monitored data export flags. If an enterprise demonstrates consistent enforcement, the People’s Court shifts the evidentiary burden to the accused infringer to demonstrate lawful derivation.
Systematic enforcement of confidentiality measures forms the legal basis for seeking preliminary injunctions and damages during trade secret litigation before specialized intellectual property tribunals.
Evidentiary Standards for Digital and Physical Safeguards in Chinese Courts
Enforcing trade secrets in Chinese courts demands unbroken, notarized digital and physical access safeguards that satisfy strict judicial appraisal thresholds.