I. Changes to the Constituent Elements of Trade Secrets

1) Amendment of the definition of trade secrets

The concepts of "economic benefits" and "practical applicability" in the previous regulations have been consolidated into the broader concept of "commercial value," expanding the scope of the definition.

2) Expansion of the concept of commercial value

The new regulations explicitly protect both actual and potential value, including interim results, data from failed experiments, and technical solutions.

3) Stricter criteria for determining non-public knowledge

The time of infringement is now used as the reference point for judgment. Information derived from organizing, improving, or processing publicly available data may be reclassified as non-public knowledge.

4) Significant broadening of confidentiality measures

The previous regulations only covered traditional confidentiality agreements and systems. The new regulations incorporate measures for digital environments, such as remote work protocols, cross-border collaboration controls, hierarchical access authorization, data masking, operational log traceability, partitioned management in classified areas, and clearance of secrets from departing employees.

II. Expansion of Protection Scope

1) Technical information

The new regulation explicitly includes algorithms, computer programs, source code, and data, etc.

2) Business information

The new regulations explicitly covers in-depth business insights, such as customer transaction habits, intentions, and specific content.

3) Customer-related information

Unlike the previous regulations, protection is no longer limited to customer lists but extends to transaction habits, intentions, related content, etc.

III. More Detailed and Stringent Identification of Infringement Acts

1)Added digital infringements, such as "cyber intrusion"

Explicit prohibitions have been added against unauthorized access to systems, servers, email accounts, cloud drives, deployment of malicious programs, exploitation of vulnerabilities, and downloading/transmitting secrets beyond authorized access.

2) Explicit prohibition of inducing, luring, or assisting in infringement

While the previous regulation lacked specific provisions, the new regulation explicitly brings indirect infringement under control.

3)Clearer rules on third-party infringement

The new regulation clarifies that acquiring, using, or disclosing confidential information with knowledge or constructive knowledge that such information is infringing constitutes infringement.

4) Clearer boundaries for lawful conduct

The new regulation provides detailed clarifications on exceptions, including independent research and development, reverse engineering, the use of general knowledge and experience of former employees, and lawful disclosure in the public interest.

IV. Major Breakthrough in the Rules of Evidence (Most Critical Change)

1) Established the presumption of infringement rule based on "substantially identical + possibility of access", where the right holder can prove two points to establish a presumption of infringement.

01. The information used by the alleged infringer is substantially identical to the trade secret;

02. The alleged infringer has the conditions to access the trade secret.

2) Burden of proof shifts to the infringer

After the presumption of infringement is established, the burden of proof is transferred to the alleged infringer, who must prove that their acquisition or use was lawful, otherwise infringement is confirmed.

3) Support for appraisals and expert opinions

It is clarified that judicial appraisal can be conducted for non-public knowledge and substantive equivalence.

V. Upgraded Jurisdiction and Law Enforcement Authority

1) New provision on escalated jurisdiction for technical secrets cases

Technical secrets are generally under the jurisdiction of the market supervision and administration departments at or above the level of cities divided into districts.

2) Law enforcement measures have been significantly enhanced. Whereas the old regulations only provided for inspection, inquiry, and copying of materials, the new regulation adds: sealing and seizing property, inquiring into bank accounts, and clarifying graded approval.

3) Strengthen the obligation of confidentiality in law enforcement

Law enforcement personnel must keep confidential, and the content of trade secrets shall not be disclosed in the administrative penalty decision.

4) Emphasize the principle of minimal intervention to reduce the impact on normal operations.

VI. Significant Increase in Legal Liability

1) Substantial Increase in Fine Ceilings

The old regulation had a maximum fine of RMB 200,000. The new regulations establish a general fine range of RMB 100,000 to 1,000,000, with serious cases subject to fines between RMB 1,000,000 and 5,000,000, representing a marked increase from the prior framework.

2) Clarification of "Serious Circumstances"

The criteria constituting "serious circumstances" have been explicitly defined to include instances of significant losses, severe impact on business operations, harm to national interests, and recidivism within a two years, etc.

3) More Specific Injunctive Measures

Detailed measures to cease infringement have been outlined, including orders to cease use, return or destroy carriers, destroy infringing products, and erase trade secrets. These measures generally remain in effect until the relevant secrets no longer retain their confidential status.

VII. Other Significant Institutional Changes

1) Expanded Scope of Rights Holders

The new regulations explicitly broaden the definition of rights holders to include owners, licensees, and other authorized parties.

2) Introduction of Extraterritorial Effect

Acts of trade secret infringement committed outside China that harm the rights and interests of business operators within China are subject to these Provisions.

3) Alignment with the National Secrets Law

In cases where the infringed information also constitutes a state secret, the provisions of the Law on Guarding State Secrets shall take precedence.

4) Implementation Date

The new regulations are scheduled to come into official effect on June 1, 2026.