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After months of haggling, the European Parliament last week formally approved new rules to help companies protect their trade secrets. The move creates a framework for the European Union in which companies can take legal action against someone who allegedly steals confidential information.

The rules, which must also be passed into law by national parliaments in EU countries, were devised in response to longstanding complaints by corporations that Europe lacks a uniform approach to dealing with the theft of trade secrets.

“With one company out of every five a victim of theft of trade secrets every year, harmonization should allow the creation of a safe and trustworthy environment for European companies, which will see their intangible assets and know-how secured,” said Constance le Grip, whose role as rapporteur is to shepherd proposals to the European Parliament, in a statement.


But the rules, known as the Trade Secrets Directive, are sparking sharp protest from numerous organizations that claim the effort may jeopardize the legal rights of whistleblowers and others that attempt to disclose alleged wrongdoing by corporations.

Health Action International, for instance, contends the rules will benefit drug makers, which have sparred with European regulators over the extent to which confidential clinical trial data should be made available to outside researchers. Anyone who reveals important safety and efficacy information “will not be adequately protected under the law,” the advocacy group said in a statement.


The concern is that the European Medicines Agency and regulators in specific countries may become overly cautious and “less inclined” to release information. “Trade secret protection has long been a recurring argument by the pharmaceutical industry to justify data secrecy,” HAI argued.

As an example, the advocacy group pointed to the recent episode in France, where a clinical trial left one person dead and five others hospitalized. The company sponsoring the trial refused to release various details, citing confidential information.

For her part, le Grip countered that the rules, which must still be approved by each of the European Union member nations, contain safeguards that will provide legal protection for journalists and whistleblowers.

And a spokesman for the European Federation of Pharmaceuticals Industries and Associations, a trade group, also disputed the concerns.

The rules “will have absolutely no bearing on existing legislation on public access to information, on pharmaceutical companies’ obligations” under a new regulation governing disclosure of clinical trial information, or a policy recently adopted by the European Medicines Agency on publishing trial data.

“These all fall outside the scope of the directive,” he wrote us.

The EMA just last month finalized guidelines on redacting trade secrets from published trial data after more than a year of haggling. The guidance requires companies to justify when they want to withhold “confidential commercial information,” by explaining how their economic interests would be harmed.

The guidance has been met with mixed reaction and European Ombudsman Emily O’Reilly, who has sparred with the EMA over the issue, is expected to release an analysis shortly of a settlement of a lawsuit filed by AbbVie against the regulator over the release of trial data.

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Health advocates are not the only ones concerned with the new rules. Several media organizations — including Reporters Without Borders, the European Federation of Journalists, and the European Magazine Media Association — released a statement expressing doubts.

The language protecting journalists and whistleblowers is “not clear enough, which means that safeguards for freedom of the media will largely depend on how national governments implement” the rules. In addition, whistleblowers are potentially left exposed insofar as they will be held to prove that the disclosure of information is made “for the purpose of protecting the general public interest.”

Although the debate may be confined to Europe for the moment, Tessel Mellema, a policy advisor at Health Action International, contended that the “harmonization of trade secret protection in the EU has paved the way of inclusion of trade secret protection” in the Transatlantic Trade and Investment Partnership, a trade deal that is being negotiated between the EU and the United States.