Cross-Border Licensing Baseline Mechanics under PRC Civil Code Provisions
PRC Civil Code technology licensing hinges on explicit title warranties, MOFCOM TIER recordation for SAFE exchange, and compliance with Article 850 rules.
Trade Secret Confidentiality Survival
Meaning
Contractual effects ensure that the obligation to protect sensitive business information continues even after the main agreement has ended. A trade secret confidentiality survival clause prevents an employee or a business partner from disclosing protected data once their relationship with the owner finishes. This protection is central because the value of a trade secret depends entirely on its secrecy being maintained.
Most commercial contracts include this provision to cover drawings and manufacturing processes.
Post-Termination Duty
Legal obligations to maintain silence remain in force regardless of how the contract was terminated. When a trade secret confidentiality survival provision is active, former partners must continue to treat the information with the same level of care as they did during the contract term. This duty includes preventing accidental disclosure to third parties and not using the information for their own commercial gain.
Breach of this duty allows the owner to seek liquidated damages or an injunction.
Duration Limit
Statutory rules in some jurisdictions may restrict how long a person can be tied to a non-disclosure agreement. In Chinese practice, a trade secret confidentiality survival clause often lasts until the information enters the public domain through no fault of the recipient. Unlike non-compete clauses, which are strictly limited to two years for employees, confidentiality duties can theoretically last indefinitely.
However, owners must be able to prove that the information still meets the legal definition of a trade secret to enforce it years later.
Protection Standard
Administrative and judicial enforcement depends on the measures taken by the owner to keep the information secret. For a trade secret confidentiality survival claim to succeed, the owner must show they used digital locks and restricted access. If the owner was careless with the data, the court may find that the information has lost its status as a secret.
This means that the survival clause only protects information that is actively guarded. Effective trade secret confidentiality survival remains dependent on the continuous application of protective measures by the owner.