The State Administration for Market Regulation of the People's Republic of China has issued the Provisions on the Protection of Trade Secrets, which shall take formal effect on June 1, 2026. The old provisions issued in 1995 shall be repealed simultaneously.
The new provisions represent an all-round upgrade in core areas including protection scope, value determination, infringement regulation and legal sanctions.
Expanding the Scope of Protection
The new provisions have significantly expanded the scope of trade secret protection, officially incorporating core digital economy assets such as data, algorithms, computer programs and codes into the protection of technical information.
Meanwhile, it has refined the scope of business information protection to cover in-depth business data including customers' transaction habits and intentions.
Criteria for Determining Commercial Value
Article 7 of the new provisions specifically defines "having commercial value" in relation to trade secrets, clarifying that the commercial value of business information includes both actual and potential value.
It also clarifies that interim achievements, failed experimental data and technical schemes generated in production and business activities shall be deemed to have commercial value if they meet the criteria for determining commercial value.
Infringement Determination
In terms of infringement determination, electronic intrusion has been added as a form of improper acquisition. Acts such as unauthorized access to systems, theft of trade secrets through technical means, and transmission of trade secrets to external devices shall all be deemed as infringement.
Non-infringement Scenarios
The new provisions clearly delineate five types of acts that do not constitute trade secret infringement, so as to balance the protection of trade secrets with the needs of fair market competition and rational flow of talents.
Independent discovery and independent research and development
Conducting technical analysis on products from public channels
Former employees engaging in work by applying the knowledge, skills and experience accumulated in their work
Lawful disclosure based on public interests
Other acts that do not constitute trade secret infringement
Strengthening Penalties and Clarifying "Serious Circumstances"
In terms of legal sanctions, the new provisions add a clause specifying the circumstances for determining "serious circumstances", with a simultaneous and significant increase in the intensity of penalties.
It clearly stipulates that the basic fine for infringing acts shall be not less than 100,000 yuan ($13,800) and not more than 1,000,000 yuan ($138,000); for serious circumstances, the fine shall be not less than 1,000,000 yuan ($138,000) and not more than 5,000,000 yuan ($690,000), representing a substantial increase compared with the penalty range under the old provisions.
Cross-border Infringement Protection
Furthermore, the new provisions fill the gap in cross-border infringement protection and will legally handle overseas infringement acts that disrupt the domestic market and harm the rights and interests of domestic business operators, adapting to the development of the global business environment.
The implementation of the new provisions has strengthened the protection of various types of core assets, clarified the boundary of legitimate acts, and provided clear compliance guidelines for the business activities of market entities.
Source：https://www.samr.gov.cn/zw/zfxxgk/fdzdgknr/fgs/art/2026/art_a89ca909478b460595670fabe02b21d3.html
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