Non-Competition Clauses in Employment Contracts: A Danish Perspective
This content discusses non-competition clauses in relation to employment contracts from a Danish perspective, covering the overall purpose, scope, subjects, and statutory obligations. It also delves into the proposed EU Trade Secrets Directive, including definitions and areas requiring further guidance.
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Presentation Transcript
NON-COMPETITION CLAUSES IN RELATION TO EMPLOYMENT CONTRACTS - A DANISH PERSPECTIVE Advokat Anders Valentin NIR 20 June 2016
ACT ON EMPLOYMENT CONTRACT CLAUSES page 2 Overall purpose to reduce the use of employment contract clauses Applies to salaried employees (modif.: salaried partner in law firm!) Applies to non-competition, non-solicitation and combination of both etc. Entered into as of 1 January 2016 and later
NON-COMPETITION CLAUSES (ACT ON EMPLOYMENT CONTRACT CLAUSES) page 3 Competition restriction Content Scope Subjects Based on contractual obligation of loyalty Prohibitionagainst conduct contraryto employer s commercialinterests Comprehensive, but only while employed All salaried personnel + executive management (CEO, CFO, etc.)
ACT ON FAIR MARKETING PRACTICES page 4 Competition restriction Content Scope Subjects Statutory obligation of loyalty Requirementof fair conduct/marketing practices During and after term of employment, but only if disloyalconduct All salaried personnel + executive management (CEO, CFO, etc.) and persons with accessto business Protectionof trade secrets (obtaining/passingon) (EnforcementDirective does not apply = not IP) Trade secrets notdefined
THE PROPOSED EU TRADE SECRETS DIRECTIVE page 5 Definition of Trade Secrets is information , which is secret (neither generally known nor readily accessible) has commercial value because it is secret has been subject to reasonable steps to keep it secret (generally similar to TRIPS Agreement, article 39 (2)
THE PROPOSED EU TRADE SECRETS DIRECTIVE page 6 Two areas (in particular) will require further guidance from CJEU What is commercial value ? Preamble states that information has commercial value when its unauthorized acquisition, use or disclosure may harm the interests of the possessor by undermining scientific/technical potential, business/financial interests, strategic positions or ability to compete What are reasonable steps ? Generally: the more control implemented over access to (and use of) information, the higher the likelihood of protection by law
THE PROPOSED EU TRADE SECRETS DIRECTIVE page 7 Lawful handling of Trade Secrets Reverse engineering and independent discovery/invention/creation etc. of information otherwise qualifying as Third Party Trade Secret NB! Access to reverse engineering is not mandatory by law but member states may make it mandatory by law. Freedom of expression and information Whistleblowing
THE PROPOSED EU TRADE SECRETS DIRECTIVE page 8 Remedies Similar to those in the IP Enforcement Directive Courts may grant injunctions (EU-wide?) Other remedies include damages and accounts of profits Member states may chose to restrict liability for employees having acted without intent
Horten Advokatpartnerselskab Philip Heymans All 7 DK-2900 Hellerup, Copenhagen Tel. +45 3334 4000 Fax +45 3334 4001 info@horten.dk horten.dk
