Dutch law protects a trade secret automatically, without any contract, once three conditions are met: the information is secret, it has commercial value because it is secret, and you have taken reasonable steps to keep it that way. Most disputes turn on that third condition – information that circulates freely inside a business, without access control or a confidentiality clause, is not protected however valuable it is.
This protection follows from the Trade Secrets Protection Act (Wet bescherming bedrijfsgeheimen), which implemented the EU Trade Secrets Directive into Dutch law. Unlike a patent, a trade secret is not registered anywhere; it exists only for as long as it stays secret and is guarded as such.
What counts as a trade secret?
Recipes and formulations, manufacturing processes, source code, algorithms and models, customer and supplier lists with pricing terms, margin data, and unpublished research results can all qualify. An employee’s general knowledge, skill and experience does not – the law does not let an employer lock up what someone has learned simply by doing the job.
What is prohibited?
Acquiring a trade secret through unauthorised access or copying, or by other conduct contrary to honest commercial practices, is unlawful. So is using or disclosing it in breach of a confidentiality obligation. Liability also extends to a party who knew, or ought to have known, that the information reached it through such conduct – which is how a competitor that recruits a whole team can end up liable alongside the individuals involved.
Reverse engineering a lawfully obtained product is, in principle, permitted, unless it has been validly excluded by contract. Independently discovering the same information is always permitted.
What remedies are available?
The court can prohibit further use and disclosure, order the recall or destruction of infringing goods, order the delivery up of documents and files, and award damages. Where the infringer acted in bad faith, damages can be measured by the profit it made rather than by the loss you suffered.
Interim relief is available, and in this area speed matters more than almost anywhere else: once information is public, it is no longer secret, and no court order can undo that. Proceedings are adapted to the subject too – the court can restrict access to documents and hearings so that litigating does not itself destroy the secret it is meant to protect.
How do you protect a trade secret in practice?
Because legal protection depends on the measures you took, those measures are the strategy. Identify what is actually secret – a register of categories, not a blanket claim that everything is confidential. Restrict access on a need-to-know basis and log who has it. Use confidentiality clauses with employees, contractors and counterparties, reinforced by a penalty clause, because proving the loss caused by a disclosure is otherwise very difficult. Mark sensitive documents, and run a proper exit procedure when someone leaves: retrieve devices, disable accounts, and remind the departing employee of their obligations in writing.
How does a trade secret differ from a non-compete clause?
A confidentiality clause and a non-competition clause do different work. The confidentiality clause protects information and can last indefinitely. The non-competition clause restricts where someone may work afterwards and is subject to its own strict requirements, including in fixed-term contracts. Relying on a non-competition clause alone to protect information usually fails on both fronts: it is easier to challenge in court, and it does not actually stop the information from being used.
An illustrative example
An illustrative example: a sales manager leaves to join a competitor and takes a spreadsheet of customer margins and renewal dates. Because the company had restricted access to that spreadsheet and the employment contract contained a confidentiality clause with a penalty, it could seek an injunction and damages. Without those measures in place beforehand, the same facts would likely have led nowhere.
In summary
- A trade secret is protected automatically once it is secret, has commercial value because it is secret, and you have taken reasonable steps to keep it secret.
- General know-how an employee picks up on the job is never a trade secret.
- Remedies include an injunction, recall or destruction of infringing goods, delivery up of documents, and damages, which can be based on the infringer’s profit if it acted in bad faith.
- Protection depends entirely on the measures you can show you took, so access control, confidentiality clauses and a clear exit procedure matter more than the label you put on a document.
- Act quickly: once a secret becomes public, no court order can make it secret again.
FAQ
Do I need to register a trade secret to be protected?
No. Unlike a patent or trademark, a trade secret requires no registration. Protection exists automatically as soon as the three conditions are met, and it ends the moment the information is no longer secret.
Can a former employee use knowledge from their old job?
Yes, for their general knowledge, skill and experience. They may not take or use specific confidential information such as customer data, pricing models or source code that was properly protected by their former employer.
What should I do first if I suspect a trade secret has been leaked?
Secure your evidence of what was taken and how, and move quickly – interim relief is only effective before the information spreads further. Early legal advice affects both the remedies still available and how the claim should be framed.
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