China Releases New Regulation to Protect Trade Secrets

China protects trade secrets from being illegally acquired, disclosed, used, or permitted to be used by others primarily through the Anti-Unfair Competition Law (the “AUCL”) (revised in 2025), supplemented by relevant administrative regulations and judicial interpretations. The State Administration for Market Regulation (SAMR) recently released the Regulation on Protection of Trade Secrets (the “New Regulation”), effective on June 1, 2026, with an aim to provide more detailed protection guidance and reinforce administrative enforcement of the AUCL in respect of trade secret protection. The 1995 Regulation on Prohibiting Trade Secret Infringement will be repealed then. 

1.The New Regulation interprets the definition of Trade Secrets 

The AUCL provides that trade secrets refer to technical information, business information, and other commercial information that is not known to the public, has commercial value, and for which the right holder has taken corresponding confidentiality measures.

The New Regulation gives detailed elaborations to the key elements in the definition of trade secrets.

(1)“Technical information” includes information related to technology such as 

• structures

• raw materials

• formulas

• materials

• samples

• styles

• processes

• methods

• data

• algorithms

• computer programs

• codes

(2)“Business information” includes information related to business activities such as

• ideas

• management

• sales

• finance

• plans

• samples

• customer information, including customer’s name, address, contact information, and information such as transaction habits, intentions, and content.

• data

(3)“Not known to the public” means that at the time the alleged act of infringement of trade secrets occurs, the relevant commercial information is not generally known to or readily accessible by relevant persons in the field to which it belongs.

Any of the following circumstances shall be deemed as circumstances where the relevant commercial information is known to the public:

• the information constitutes general knowledge or industry practice in its field;

• the information merely concerns dimensions, structures, materials, or simple combinations of components of a product, which relevant persons in the field can directly obtain by observing products available on the market;

• the information has been publicly disclosed in published materials or other media;

• the information has been made public through open reporting meetings, exhibitions, and the like;

• relevant persons in the field can obtain the information from other public channels.

However, where relevant commercial information known to the public is organized, improved, or processed to form new information that meets the requirements of “not known to the public” as outlined above, it shall be deemed not known to the public.

(4)“Have commercial value” means that the commercial information has actual or potential value and can bring the right holder commercial benefits or competitive advantages such as asset appreciation, increases in operating revenue or profit, growth in the number of users, reductions in costs and expenses, shortened research and development time, increased transaction opportunities, or improvements in business reputation or commodity goodwill.

More importantly, the New Regulation clarifies that interim achievements formed in production and business activities, or failed experimental data, technical solutions and the like that meet the above requirements shall be deemed to have commercial value. 

(5)“the right holder has taken corresponding confidentiality measures” means that the right holder, in order to prevent the disclosure of trade secrets, adopts reasonable confidentiality measures that are commensurate with factors such as the nature of the trade secrets and their carriers, and the commercial value of the trade secrets.

They may include the following circumstances: 

• executing confidentiality agreements or stipulating confidentiality obligations in contracts;

• by establishing rules and regulations, conducting training, providing written notifications, and the like, imposing confidentiality requirements on employees, former employees, suppliers, customers, visitors, and other persons who can access or obtain trade secrets;

• prohibiting or restricting entry into confidential plants, workshops, laboratories, offices, and other production and business premises, or implementing differentiated management of such premises;

• adopting technical confidentiality measures such as tiered access control, data desensitization, and operation log retention for scenarios such as remote work and cross-border collaboration;

• managing trade secrets and their carriers separately by means such as marking, classification, segregation, encryption, sealing, and restricting the scope of persons who can access or obtain trade secrets and their carriers;

• with respect to computer equipment, network equipment, storage equipment, and the like that can access or obtain trade secrets, adopting measures to prohibit or restrict use, access, storage, copying, and the like;

• requiring departing employees to register, return, purge, or destroy the trade secrets and their carriers that they have accessed or obtained, and to continue to bear confidentiality obligations;

• adopting other reasonable confidentiality measures.

2.The New Regulation details the improper means of acquiring trade secrets

It is prohibited from acquiring trade secrets through theft, bribery, fraud, coercion, electronic intrusion, or other improper means.

Specifically, “other improper means” include the following circumstances:

• without authorization or beyond the scope of authorization, unauthorized access, possession, or copying of carriers under the control of the right holder that contain trade secrets or from which trade secrets can be derived, such as documents, articles, materials, and raw materials;

• by providing money or other property interests, personal threats, and the like, bribing, coercing, or deceiving employees or former employees of the right holder or other entities or individuals to obtain trade secrets for them;

• without authorization or beyond the scope of authorization, unauthorized access to the right holder’s digital office systems, servers, email accounts, cloud drives, application accounts, and the like, or obtaining trade secrets by technical means such as installing malicious programs or exploiting vulnerabilities;

• without authorization, beyond the scope of authorization, or upon expiration of the authorization period, unauthorized downloading or transmission of trade secrets to electronic mailboxes, cloud drives, and other online storage spaces or electronic devices not controlled by the right holder;

• other improper means of obtaining the right holder’s trade secrets.

3.The New Regulation elaborates what the right holder’s required confidentiality obligations and maintenance requirements could be

In general, it is prohibited from disclosing, using or allowing any third party to use trade secrets by breaching confidentiality obligations or trade secretes maintenance requirements set by the right holder.

The concerned confidentiality obligations or trade secrets maintenance requirements could include the following:

• stipulating the maintenance of trade secrets in contracts such as labor contracts, confidentiality contracts, and sales contracts;

• in the absence of contractual stipulations, being obligated to maintain trade secrets in accordance with the principle of good faith, based on the nature and purpose of the contract as well as trade practices and commercial ethics;

• the right holder imposes confidentiality requirements on relevant subjects who are aware of the trade secrets, including but not limited to subjects who have become aware of the trade secrets through contractual relationships, and those who have become aware of the trade secrets by participating in research and development, production, inspection, certification, and other activities;

• in the absence of contractual stipulations, the right holder, through rules and regulations or reasonable confidentiality measures, expressly requires employees, former employees, and partners to maintain trade secrets;

• other circumstances where confidentiality obligations exist or the right holder raises requirements regarding the maintenance of trade secrets.

4.The New Regulation lists exceptions to trade secrets infringement 

The New Regulation acknowledges that the following circumstances would not constitute infringement of trade secrets:

• independent discovery or independent research and development;

• disassembly, mapping, analysis, and the like of products obtained from public channels to obtain relevant technical information of the products;

• former employees of the trade secret right holder using general knowledge, skills, and industry experience accumulated during their work, or using industry information available through public channels to carry out their work;

• based on the need to expose illegal and criminal acts or to safeguard national security and the public interest of society, lawfully disclosing trade secrets to State organs, statutory institutions undertaking administrative functions, and their staff;

• other acts that do not constitute infringement of trade secrets.

As we can see from the above, “reverse engineering” could be a way acceptable to the New Regulation to acquire technical information of other right holders. Even so, a right holder may still contractually prohibit its business partners from acquiring its trade secrets through such reverse engineering in confidentiality agreements or other business contracts. 

5.The New Regulation provides guidelines to what needs to be submitted for reporting trade secrets infringement 

A right holder may report any alleged infringement of trade secrets to SAMR for protection. For reporting purpose, it is required to submit (1) preliminary evidence materials that prove its commercial information constitutes trade secrets and (2) specific clues of infringement.  

The preliminary evidence materials may include the following:

• the formation process and time of the commercial information;

• the commercial information is not known to the public;

• the commercial value of the commercial information;

• the confidentiality measures adopted by the right holder;

• other evidence materials that can prove that the right holder’s commercial information constitutes trade secrets.

Specific clues of infringement may include the following: 

• clues indicating that the suspect has channels or opportunities to obtain the trade secrets;

• clues indicating that the confidentiality measures for the trade secrets have been destroyed by the suspect by improper means;

• clues indicating that the trade secrets have actually been obtained by the suspect;

• clues indicating that the trade secrets have been disclosed or used by the suspect, or are at risk of disclosure or use;

• other clues indicating that the trade secrets have been infringed by the suspect.