Prior to 2018, several bodies of law governed trade secret legislation in Finland. Various provisions providing comprehensive protection for trade secrets were included in laws such as the Criminal Code, the Unfair Business Practices Act, the Employment Contracts Act and several others.
Since the implementation of Directive (EU) 2016/943 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure (hereinafter the Trade Secrets Directive) into national law in 2018, trade secret regulation was codified into one general act.
The definition of a trade secret was included in the Finnish Trade Secrets Act. References to trade secrets in other Finnish legal texts were similarly unified in accordance with the new act. Therefore, as of recently, the general source of civil regulation concerning trade secrets is the Finnish Trade Secrets Act while most offences concerning trade secrets remain criminalised in the Criminal Code.
The type of information protectable as a trade secret has not been limited as such, but information does have to fulfil certain requirements in order to be considered a trade secret. That is to say that information of any type or form may be protectable as long as it fulfils the three requirements established for a trade secret in the Trade Secrets Act; for more detail, see 1.4 Elements of Trade Secret Protection.
Since there are no strict limitations to the type of information protectable as a trade secret, the examples that could be given are many and varied. Common examples of protectable trade secrets include information of a technical or financial nature. Concrete examples would constitute product development information, business methods, pricing and market information, economic predictions, competition analysis, client registers as well as administrative and organisational information about a company. Moreover, trade secrets could constitute parts of computer code or algorithms within software as well as food recipes.
Importantly, the Finnish legislator has specifically pointed out that, in addition to positive information, so-called negative information (for example, that a certain solution does not work for a particular product) may also constitute a trade secret.
Through the implementation of the Trade Secrets Directive, the criteria for a trade secret have been harmonised EU-wide. According to the derivative Trade Secrets Act, a trade secret has three requirements. Firstly, it must not be generally known or readily accessible to persons who normally deal with the type of information in question. Secondly, the secrecy of the information must have economic value for a business. Thirdly, the definition requires that the rightful owner of the trade secret has taken reasonable measures to ensure the protection of the information. Since the implementation of the Trade Secrets Act, references to trade secrets in other acts of Finnish legislation have been linked to this definition.
Taking reasonable measures means that the rightful owner of the trade secret on the one hand endeavours to keep the information secret, and on the other hand ensures that people handling trade secrets are aware of it. Whether the measures taken are reasonable enough must be assessed on a case-by-case basis. Such measures can again be many and varied depending on the nature of the protectable information and the protection methods available to the owner.
Reasonable measures taken can be as simple as maintaining physical barriers to secret information – for example, by storing confidential documents behind locked doors. In the electronic era, more common and widely used measures of protection include adequate security for IT systems through the use of passwords and firewalls as well as limited access to certain databases. In addition to any security measures taken, up-to-standard confidentiality agreements between companies, their employees and business partners constitute a vital form of protection.
Despite the fact that reasonable measures may include a wide variety of methods, some specific measures which have not fulfilled the criterion have also been identified in Finnish case law. Measures include physical signs conveying that an area contains confidential information or oral expressions alone about the secrecy of certain information have not been considered adequate enough to be considered reasonable measures.
In general, successful business practice often requires certain trade secrets to be shared with a considerable amount of a company’s employees. However, the fact that trade secrets must at times be disclosed to employees does not translate to them losing their protection.
In Finland, the protection of information disclosed to employees is regulated in the Trade Secrets Act, the Employment Contracts Act and the Criminal Code. According to the Trade Secrets Act, an employer’s trade secrets may not be unlawfully disclosed or used for the employee’s own benefit during the duration of the employment. Moreover, the Finnish Employment Contracts Act identically dictates that an employee may not unlawfully disclose an employer’s trade secrets or use them for their own benefit.
Further, the offences concerning trade secrets in the Criminal Code are similarly applicable to an employee as to anyone else. Therefore, the availability for protection per se is not limited when disclosing secret information to employees, it simply means that the circle to which secret information is trusted to has grown, which in turn means that more focus must be put on protective measures.
Despite the fact that trade secrets are protected in relation to employees similarly as to anyone else, there are some specific limitations to the length of the protection. Both the Trade Secrets Act and the Employment Contracts Act only limit the employee’s right to disclosure and use of the trade secrets to the duration of the employment. The Criminal Code, on the other hand, limits use and disclosure up to two years after employment has ended. This is only relevant in connection to trade secret violations. Misappropriation and industrial espionage offences, which can also be committed by an employee, have no similar time limitations. In order to extend the length of protection, relevant confidentiality agreements must therefore be in place between the employer and employee to prevent the leakage of secret information by former employees.
Another form of protection used in an employment relationship that is particular to the Finnish Trade Secrets Act is the so-called “technical instruction”. The provision prohibiting the unlawful use or disclosure of a technical instruction is derived from the prior Unfair Business Practices Act and was therefore included in national trade secret legislation.
According to the act, it is prohibited to disclose or use a technical instruction in order to gain financial benefit for oneself or another, or in order to harm another. A technical instruction does not need to fulfil the requirements of a trade secret to be granted protection and the protection thereof is based on the fact that it constitutes information which has been disclosed to an employee or business partner in confidence. Thus, the requirements for a piece of information to constitute a technical instruction are less rigid than those of a trade secret and moreover the protection of a technical instruction has no statutory time limit.
The Finnish Trade Secrets Act confirms that gaining information through independent discovery or reverse engineering does not constitute trade secret misappropriation. According to the Trade Secrets Act, the acquisition of a trade secret is lawful when it occurs through discovering a trade secret through the observation, study or testing of a product or an object which has been made available to the public, or that is lawfully in the possession of someone who has no duty to limit the acquisition of the trade secret.
Thus, the principle is that lawful independent discovery should be fairly easy and not require an unreasonable amount of time or effort to conclude. In case law, the Supreme Court of Finland has, for example, found that what can be visually detected from a publicly available product cannot constitute a trade secret to begin with. Products which are available to the public cannot constitute a trade secret for the part that human sensory-based detections can be made from them. These same products may, however, include trade secrets which cannot be visually detected. For example, tolerance levels of products constitute product information which cannot be visually detected. On the other hand, case law has also confirmed that the drawings and sketches of specific machinery may include trade secrets even if the principle and the outlines of its mechanics are generally known information.
There are no specific provisions concerning protection of computer software or other technology as trade secrets. In general, computer software is protected by the Finnish Copyright Act. Despite copyright being the accepted primary protection method of software, it has been considered insufficient at times.
Whereas copyright protects the exact form in which code is presented, the idea behind it is left unprotected. Therefore methods, principles and other relevant information concerning software would, upon fulfilling the necessary requirements, have to be protected as trade secrets in lack of any other form of protection. What must be considered is that reverse engineering of information is allowed. This also affects the protection of computer software and source code as trade secrets in particular. Moreover, information concerning software and technology may be protectable as technical information as described in 1.6 Disclosure to Employees.
There is no definite statutory timeline for the duration of trade secret protection in Finnish legislation and, therefore, a trade secret has protection for as long as it fulfils the requirements set out for it. As time passes, if information which has previously been considered a trade secret becomes public information or otherwise loses its economic value, it simultaneously loses its legal protection. That is to say that the value of any such information considered a trade secret at one point in time may and most likely will also dilute when time passes. This is especially relevant for fast-paced technical developments or financial figures from previous years.
Conversely, some information may fulfil the requirements of a trade secret indefinitely. A common example of such information is iconic recipes. Although there is no limit to the duration of protection, the relevant statutes of limitations described in more detail in 5.2 Limitations Period pose restrictions on the timeframe during which lawsuits can be raised against misappropriation.
Licensing a trade secret does not differ from licensing any other intellectual property right as such. Licensing agreements can therefore be freely concluded under the consideration of the trade secret owner. However, when information being licensed is solely protected as a trade secret, as opposed to any other IP right, relevant confidentiality agreements must be in place in order to ensure an adequate level of protection.
Unlike other IP rights, trade secrets do not create an exclusive right to use protected information. The same trade secret may therefore be independently known to many parties at the same time while still enjoying legal protection. Unlike most other intellectual property rights, there are also no conditions to what a trade secret protection may protect in terms of its shape, form or other technical, aesthetic or formal elements. As previously noted, there is also no set timeline to how long a trade secret is protected. While many other IP rights may be registered or even require registration for validity, trade secrets cannot be registered as their protection is based solely on the fact that they are kept secret.
The concept of "double protection" exists in connection to IP rights. In essence, double protection means that, for example, something enjoying a copyright may also well be protected as a trade secret. Although double protection is possible, these overlapping rights constitute separate methods of protection and are regarded individually.
In cases where bringing claims for trade secret misappropriation, violation or suchlike is not possible on the basis of the Trade Secrets Act or the trade secret offences enshrined in the Criminal Code, other legal theories may still be available. Offences relating to trade secrets may amount to the misuse of a position of trust which has been criminalised in the Criminal Code or even to a secrecy offence, at least indirectly. Additionally, any violation of an employee’s loyalty towards their employer may be taken into consideration when assessing the rights to termination of employment.
Please see 1.13 Other Legal Theories.
The Criminal Code identifies three types of trade secret offences: industrial espionage, the misappropriation of a trade secret and the violation of a trade secret.
In the Criminal Code, the offence of misappropriation is defined as unlawfully using a trade secret which has been acquired or disclosed through an act punishable in the Criminal Code or disclosing a trade secret in order to obtain financial benefit. The closely related offence of trade secret violation is defined in the Criminal Code as unlawfully disclosing or utilising a trade secret which has been learned while in the service of another or in any other trusted position, to obtain financial benefit or to harm another; see also 2.4 Industrial Espionage. An attempt to violate trade secrets in any of the above ways is likewise punishable.
Both civil and criminal claims may in principle be pursued. Civil claims concerning a trade secret offence may be pursued either together with the criminal claims in criminal proceedings, or alternatively in separate civil proceedings. It should, however, be taken into account that only trade secret lawsuits against companies can be pursued before the Market Court. In the case that the offender is an individual, a trade secret law suit is always tried before a district court.
The possible penalties for a trade secret offence vary from a fine to up to two years of imprisonment.
Following the Trade Secrets Directive, the Trade Secrets Act recognises misappropriation in three main categories: unlawful acquisition, use and disclosure.
Unlawful acquisition constitutes stealing and unauthorised copying, tracing, observation or other handling of documents, objects, materials, substances or electronic files which contain a trade secret or from which a trade secret can be derived, as well as any other method of acquisition going against good business practices. Accordingly, a trade secret may not be used or disclosed by someone who has unlawfully acquired it. Moreover, a trade secret may not be used or disclosed when it has been obtained through working in different roles in a company such as part of the management, reorganisation proceedings or other trusted positions.
The Criminal Code identifies three types of trade secret offences: corporate espionage, the misappropriation of a trade secret and the violation of a trade secret. In the Criminal Code, the offence of misappropriation is defined as unlawfully using a trade secret which has been acquired or disclosed through an act punishable in the Criminal Code or disclosing a trade secret in order to obtain financial benefit. The closely related offence of trade secret violation is defined in the Criminal Code as unlawfully disclosing or utilising a trade secret which has been learned while in the service of another or in any other trusted position, to obtain financial benefit or to harm another. An attempt to violate trade secrets is likewise punishable.
As described in 1.6 Disclosure to Employees, the Trade Secrets Act, Employment Contract Act and Criminal Code all protect trade secrets from misappropriation or violation by an employee. In principle, the elements of the claim do not differ in substance but, as previously noted, the window of time during which a claim may be brought against an employee or former employee in trade secret violations is narrower and must be supplemented with adequate confidentiality agreements.
Finnish legislation does not recognise the existence of any obligations between joint ventures with respect to trade secrets. Such obligations are thus dependent on individual contracts laid out between the parties.
Industrial espionage is one of the three trade secret offences criminalised in the Criminal Code. According to the code, a person who unlawfully obtains information regarding the business secret of another by entering an area closed to unauthorised persons or accessing an information system protected against unauthorised persons, by gaining possession of or copying a document or other record, or in another comparable manner, or by using a special technical device with the intention of unlawfully revealing this secret or unjustifiably utilising it shall, unless a more severe penalty has been provided elsewhere in law for the act, be sentenced for business espionage to a fine or to imprisonment for two years.
The attempt of industrial espionage is likewise punishable. That is to say that industrial espionage covers a wide variety of situations and being convicted of industrial espionage may result in severe consequences. Additionally, the processing of trade secret cases under the criminal offence of industrial espionage does not mean that civil remedies such as damages could not be simultaneously sought out by the owner of the trade secret.
Recognised and commonly used ways to ensure the safeguarding of trade secrets beyond what has been provided by legislation again are varied. The most important practices include having separate confidentiality and non-disclosure agreements, confidentiality clauses in employment contracts and possible non-compete clauses in place when disclosing trade secrets to employees, business partners or others.
Similarly, a business partner should be required to ensure trade secret confidentiality with their own employees and business partners through appropriate confidentiality agreements. It is also prevalent to ensure that the disclosure of certain trade secrets to employees or business partners only happens on a need-to-know basis.
Other day-to-day practices to ensure the protection include ensuring both physical and electronic restrictions to secret information. It is also important to identify risks of leaks and secure them with adequate measures.
Additionally, and very importantly, anyone who may receive secret material or information must be made fully aware of its secrecy as well as their obligations towards trade secrets. In many situations, a company’s own employees pose the greatest risk of leakage, which is why adequate training and instructions on the lawful handling, as well as of the consequences of mishandling, trade secrets must be present at a workplace.
An employee must be made aware of how they can best ensure that they are acting lawfully in their daily practice – for example, by advising on how to handle information when teleworking. Important practices concerning employees leaving and joining the company are described in more detail in 3.2 Exit Interviews and 4.2 New Employees.
There are no legal obligations within Finnish legislation concerning written or other assurances with respect to confidentiality, secrecy and/or trade secrets when employment comes to an end. However, during an exit interview, it is a diligent employer’s responsibility to have their exiting employees understand their obligations toward their now former employee and remind them of their confidentiality agreements and legal obligations. It may also be necessary to remind employees of the information that they have handled which constitutes trade secrets or examples thereof. Importantly the former employee must also be asked to return all material and or access keys, etc, to information containing trade secrets.
In principle, general professional knowledge, skills, expertise or experience do not constitute trade secrets as such. Moreover, the fact that an employee is personally skilled or talented cannot be protected by an employer as a trade secret. The Trade Secrets Act specifically provides that information which is either general knowledge or easily discoverable to a person used to handling such information does not fulfil the secrecy requirement of the Trade Secrets Act. Therefore, knowledge gained through education or conventional skills and experience that may be gained by anyone in the profession clearly do not constitute trade secrets. What is more, the use of a person’s professional knowledge and expertise in their future work can only be limited so far.
In practice, however, drawing a line between pre-existing skills or expertise and trade secrets may pose a challenge. For example, a person who has worked in a highly technical project for the same company for a long period of time may possess skills and expertise through their work that also constitute information protectable as their employer’s trade secrets. Another example would be the case that knowledge has been gained through training offered by an employer. Even if the substance of the training itself may constitute general information, the training material itself is the property of the employer.
Legislation does not offer a clear-cut answer as to when skills and expertise cross a certain line and become trade secrets. This question must therefore be assessed on a case-by-case basis. In the government proposal for the Trade Secrets Act, the Finnish legislator provided some guidelines for conducting this assessment. The legislator suggested that information that is written or recorded instead of being memory-based, which is detailed rather than general, and which is in the possession of only very few companies could constitute a trade secret rather than professional skills or expertise. While the legislator’s guidelines offer a framework for reference when considering the relationship of pre-existing skills and expertise with that of trade secrets, they are not airtight. For example, a previous employee may well have memory-based knowledge of information which still constitutes a trade secret.
Generally, any new employees would have already been informed of their confidentiality obligations and have signed relevant non-disclosure agreements with their previous employer prior to taking on a new position at a competitor. However, especially when hiring an employee from a competitor to a higher position requiring special skills or expertise, the above-mentioned assessment between such skills and experience and trade secrets becomes highlighted and a new employee should be made aware of this.
Furthermore, a new employee should not bring with them documents, files or other material containing a previous employer’s trade secrets to their new place of work. In any case it is good practice to remind new employees that, equivalent to their obligations concerning your trade secrets, their obligations also extend to their previous employer’s trade secrets.
The procedure for initiating a civil lawsuit concerning misappropriation of trade secrets is the same as any other civil procedure in Finland, with the exception that a trade secret lawsuit may be also brought in the Market Court instead of a District Court. However, there are no prerequisites or preliminary steps to filing a civil lawsuit in either a district court or the Market Court.
Filing a civil claim concerning trade secret misappropriation under the Finnish Trade Secrets Act must be done within five years from when the rightful owner of the trade secret became informed of the misappropriation. Notwithstanding, a claim can only be brought a maximum of ten years from when the misappropriation took place. Initiating a criminal process under the Criminal Code must take place within five years of the criminal act.
Initiating a lawsuit concerning trade secret misappropriation follows the normal procedural steps of a civil process when claims are brought under the Trade Secrets Act. In accordance with the Finnish Code of Judicial Procedure, a civil process is initiated with a written application for a summons which is to be delivered to the relevant District Court or, in the case of certain trade secret lawsuits, the Market Court, which in turn will deliver a summons to the defendant.
Similarly, initiating a criminal process follows the normal procedural steps when offences are reported under the Criminal Code. A criminal process is initiated by making a report of an offence to the police in order for the police to start a pre-trial investigation. After the pre-trial investigation has been concluded, the matter is delivered to a prosecutor for a consideration of charges.
A trade secret misappropriation claim can be filed in two different venues. Civil procedures against natural persons as well as criminal procedures are tried in district courts as general courts of first instance. Civil procedures against undertakings or natural persons pursuing business activities in turn may also be tried in the Market Court, as a court with special expertise on the matter.
There is no legal obstacle to raising a claim concerning trade secret misappropriation in a civil procedure without concrete evidence. However, it must be noted that successful litigation concerning trade secret misappropriation usually requires a considerable amount of proof, and therefore raising a claim before having concrete evidence is likely to result in losing the case and having to reimburse your counterparty’s legal costs.
As for reporting a criminal offence, the likelihood of the pre-trial investigation resulting in the prosecutor raising charges is lowered when there seems to be no evidence on the matter. In a criminal procedure there is also the possibility of being charged for false denunciation in the event that accusations have no grounds. Although this is highly unlikely, it highlights that reports on criminal offences should not be made without good reason.
Where there is knowledge of misappropriation, but concrete evidence is not at hand or available, collecting the necessary proof for a successful claim may pose difficulties or require further efforts. Documents that are not accessible may be required to be included in evidence by, for example, the opposing party but, even then, these documents have to be identified. Therefore, and due to the fact that the police have extensive powers to conduct a pre-trial investigation, it may be worthwhile to bring a case of trade secret misappropriation as a criminal process instead of a civil process when concrete evidence cannot be accessed or identified by the owner of the trade secret.
According to the Trade Secret Act, seizure of certain products is possible in connection to a temporary injunction under the Trade Secret Act. Thus, the seizure of products may be ordered when the requirements for a temporary injunction are fulfilled and concern the ban to sell, produce or circulate goods that infringe upon trade secret rights. These products may be temporarily seized until a final judgment on the matter has been given.
In a criminal process the police carrying out the pre-trial investigation has a much larger right to obtain information and evidence from the parties than the plaintiff does in a civil process. The police may obtain information and evidence through home searches, seizures and other highly effective measures. In civil procedures, the information obtained must be based on what evidence the parties themselves have gathered from sources that are available to them. In principle, it is up to the party to gather their own evidence whereas their attorney then mirrors this evidence against relevant legal sources. It is possible for a party to also request during trial that a piece of information which is in the possession of the other party or a third party be presented as evidence during the trial.
In Finland, trade secrets in relation to the public and third parties during trial are protected by the Act on the Publicity of Court Proceedings in General Courts. The act enables limiting the public’s access to written material, oral proceedings and the final decision of the court in order to protect trade secrets. That is to say that trade secrets enjoy protection even during the trial process. The Trade Secret Act in turn goes a step further and even regulates publicity in relation to the other parties. In principle, and in accordance with the Act on the Publicity of Court Proceedings in General Courts, another party’s right to take part in hearings or to have access to the full decision cannot be limited on the grounds of trade secret protection. The Trade Secret Act, however, provides the possibility to minimise the circle of people to whom trade secrets are disclosed to during the trial process.
There are two main lines of defences against allegations of misappropriation. The first of them constitutes demonstrating that the information in question does not meet all the requirements of a trade secret and thus does not constitute a trade secret as defined in the Trade Secret Act. If the information is general or easily accessible, has no economic value due to its secrecy or if its lawful owner has not taken the necessary steps to protect it, it is not a trade secret and cannot be misappropriated. The second line of defence is demonstrating that the handling of the trade secret does not constitute misappropriation – ie, that unlawful acquiring, use or disclosure of the trade secret has not taken place as required in legislation or that unlawful acquiring, use or disclosure has not been intentional.
A court may dismiss a case without consideration on certain formal or procedural grounds. Generally, the court determines its lack of jurisdiction and other formal or procedural grounds for dismissal ex officio. However, a claimant may bring dispositive motions concerning the lack of so-called dispositive procedural requirements such as the lack of territorial jurisdiction or that the matter should be resolved by an arbitrator rather than a court.
The cost of litigation, especially in a civil lawsuit, may accrue up to a sizeable amount. This is mainly due to the fact that a trade secret lawsuit demands a considerable amount of presentable proof, the collecting and processing of which in turn requires a lot of time and effort.
In criminal proceedings, on the other hand, the police will handle most of the investigation and collection of evidence and costs thereof. However, due to the nature of trade secret offences and the fact that their investigation requires a great amount of special information about the nature of the business which is not accessible to the police, the criminal process also requires a lot of co-operation between the police, the plaintiff and their attorney.
Trials by jury do not exist in Finland as all cases are handled and decided in a bench trial. Only in very exceptional and severe criminal cases can the popular sense of justice be represented by so-called "lay judges" who take part in the decision-making process of the court.
There are three different trial processes that may be followed in a trade secret case. Firstly, there is a choice of trying the case as a civil process under the Trade Secrets Act or a criminal process under the Criminal Code. If the case is tried as a criminal process, it will be handled through an ordinary criminal process in the District Court. Upon trial through a civil process, depending on the defendant (natural person or an undertaking) the case will be tried through an ordinary civil process in a district court or in the Market Court.
Each of these trial processes entail unique characteristics but, in principle, follow the same pattern. After the process has been initiated, a trial process begins with written, and in some cases oral preparation, and follows with a main hearing during which witness testimony is heard, oral arguments are made, and evidence is examined. The process ends with closing statements by both parties. The length of a trial always depends on the complexity of the matter and the amount of witnesses to be heard, the amount of evidence to be examined, etc.
The use of expert witnesses during a civil trial in a district court has been specifically regulated in the Trade Secrets Act. According to the Act, a district court may use a maximum of two experts in a trial concerning misappropriation, during which the court poses questions to the experts who produce written statements to these questions. These statements may be commented by both parties.
In addition to the provision concerning experts in the Trade Secrets Act, the general regulation concerning the use of experts during trial can be found in the Code of Judicial Procedure. According to the Code, both the court and the parties may freely name any number of experts for statements. The use of an expert is separate from that of a witness per se. Experts, unlike witnesses, are asked to produce insight on an area of their expertise. Therefore, their testimony is legally separate from witness testimony, although in practice the distinction might not be clear.
Unlike the case for the district courts, the use of expert witnesses in market court proceedings is not regulated in the Trade Secrets Act but instead in the more open-ended Market Court Act, according to which the Market Court may use expert witnesses if the nature of the case requires it. The parties may additionally name experts for statements or as witnesses as is the case in any other trial.
Derived from Article 10 of the Trade Secrets Directive, the Trade Secrets Act also specifically provides for a possibility to seek a temporary injunction until a final decision on the case has been made by the court. The possibility of obtaining such relief has already been enshrined into the Finnish Code of Judicial Procedure, but the prerequisites to imposing such a relief are different between the two acts.
According to the Trade Secrets Act, a court may temporarily ban the continuation of the use or disclosure or other infringement of a trade secret holders rights by a person who has unlawfully acquired, used or disclosed the trade secret. This ban can be demanded and granted if the plaintiff shows that it is likely that a trade secret exists, that they are the rightful owner of the trade secret and that their right is or imminently will be infringed.
The Trade Secrets Act provides a new and harmonised approach for civil remedies for trade secret misappropriation. Instead of corrective measures, the court may order the defendant to pay compensation and damages to the plaintiff. According to the Trade Secrets Act, damages must be paid to the rightful owner of the trade secret by a person who intentionally or negligently acquires or discloses a trade secret.
Compensation, in turn, must be paid if a person, intentionally or negligently, unlawfully uses a trade secret as described in the Trade Secrets Act. Despite the existence of a separate Tort Liability Act as the main act concerning damages, the Trade Secrets Act includes a new separate damages provision which implements Article 14 of the Trade Secrets Directive.
As for punitive damages, they are not recognised in Finnish legislation and therefore only what has been lost can be payable as damages.
In accordance with the Trade Secrets Directive, the Finnish Trade Secrets Act allows for a court to impose permanent injunctions in addition to corrective measures on the infringer. According to the act, a court may order an injunction to prohibit the infringer from beginning, continuing or repeating misappropriation. However, the injunction may not be disproportionate to the circumstances at hand or unnecessarily limit the actions of the defendant.
A plaintiff may recover their attorney’s fees in a civil litigation as part of their recoverable costs. In principle, it is up to the unsuccessful party to compensate the successful party’s trial costs which include attorneys’ fees. Despite this being the general rule, a court will not order costs to be recovered from the unsuccessful party ex officio. Therefore, a party must specifically claim the costs from the opposing party. The court will then examine the claimed costs and order reasonable costs as recoverable from the other party.
Other costs that may be recovered from the unsuccessful party include, for example, reimbursements for expert statements, witness fees, travel and living expenses during the proceedings (public transport, hotel visits) as well as the loss of any earnings due to the time spent in trial. Again, these costs must be specifically claimed by the party.
Appealing a decision in a trade secret case follows the ordinary appellate procedure in place in Finland. Thus, both parties have the right to appeal an unsatisfactory decision made by the court. The appealing process differs depending on whether the claim was brought in a district court for either a civil or criminal process or the Market Court for a civil process.
Appealing a decision of the District Court to the appellate court must be done within 30 days of receiving the decision. Appealing the decision of an appellate court can be done by application to the Supreme Court for leave to appeal within 60 days of the decision of the appellate court. If the Supreme Court does not grant leave to appeal, the decision made by the appellate court will remain final. An appeal concerning a decision of the Market Court on the other hand, is made directly to the Supreme Court, which again must grant leave to appeal for the appellate procedure to be successful.
The appellate courts and the Supreme Court in Finland review both factual and legal issues. The case is retried from the beginning orally by the appellate court; in certain cases, an oral retrial is possible even by the Supreme Court. However, this occurs rarely. Additionally, in criminal procedures new evidence and facts of the case may be presented in appellate courts as well as the Supreme Court. In civil procedures new evidence might be considered during appeals procedures if the party can show that the information was not available at the trial of first instance. As described above in 8.1 Appellate Procedure, a party must appeal a decision of a court within a set timeframe.
The Criminal Code recognises offences under the titles of corporate espionage, trade secret violation and trade secret misappropriation. The process for initiating a criminal prosecution for any of these trade secret offences follows that of any other criminal proceeding in that the first line of duty is to file a criminal report of an offence to the police.
The potential penalties for all three offences are fines or imprisonment for a term not exceeding two years. Trade secret offences also entail an undertaking’s criminal liability – ie, if the offence was committed within an undertaking, this undertaking may be fined between EUR850 and EUR850,000. Similar to defences in civil law cases concerning trade secrets, the defences in a criminal case would also constitute proving either that (i) the information at hand does not constitute a trade secret or (ii) that it has not been misappropriated or that such misappropriation lacked intention.
There are no separate mechanisms for trade secret owners to co-ordinate with law enforcement authorities in investigation trade secret offences. As with any criminal case, the target of the offence is interviewed by the law enforcement authorities as part of their investigations. The law enforcement authorities may also be provided with necessary material for the investigation of the case.
As with any dispositive matter, trade secret matters may be resolved through alternative dispute resolution when this is agreed upon between parties. The most commonly used alternative dispute resolution is arbitration. However, a number of other mechanisms such as legal advisory services, mediation and other panels also exist in Finland and they may be freely used as agreed on between parties.