——The "Provisions on the Protection of Trade Secrets" will be implemented in June. What should companies and lawyers read?
On February 24, 2026, the State Administration for Market Regulation issued Order No. 126 on the "Regulations on the Protection of Trade Secrets", with thirty-one articles in full, which will come into effect on June 1. Implemented on the same day, there is another "farewell" that is often ignored: the "Several Provisions on Prohibiting the Infringement of Trade Secrets" promulgated by the former State Administration for Industry and Commerce in 1995 was abolished at the same time.
The press release wrote the words "strengthening protection". However, these four words are too lightly missed. To understand this regulation, you must first put it back into the coordinate system.
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1. First of all, let’s correct the name: This is not a new right, but a restart of the old track.
There have always been three parallel tracks for the relief of trade secrets: civil (Article 10 of the Anti-Unfair Competition Law delineates entities, and the Supreme People’s Court’s judicial interpretation refines the judgment), criminal (Article 219 of the Criminal Law, the crime of infringement of trade secrets), and administrative (enforcement by market supervision departments). This regulation falls on the third track - Administrative Protection.
Its legal identity is departmental regulations, formulated in accordance with the Anti-Unfair Competition Law. Regulations cannot create substantive rights and obligations out of thin air and can only be refined within the framework of superior laws. Therefore, its various "expansion" are essentially explanatory refinements rather than new legislative establishments. This point is the root of all the boundaries in the following sections, so write them down first.
What is really worth mentioning is the time: the last administrative regulations were issued in 1995. In the past thirty-one years, the factory has been replaced by a cloud disk, and the drawings have been turned into codes. Resigning employees no longer take away the blueprints, but copy the database. The old order has long since failed to catch up with reality. Order No. 126 is not a repair to the administrative track, but a restart - it gives new strength to the "administrative punch" that has long been overshadowed by litigation and criminal proceedings.
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2. Changes in objects: data, algorithms, and codes are officially "secret"
Paragraph 2 of Article 5 puts it bluntly: technology-related structures, raw materials, formulas, methods, as well as "data, algorithms, computer programs, codes" are all technical information; "data" is also clearly listed in business information.
This deal marks a new battlefield for the digital economy. For artificial intelligence and Internet companies, training data, model parameters and weights, algorithm logic, source code - these assets are difficult to cover with copyrights and are often unwilling to be disclosed with patents. As long as they meet the three characteristics (not known to the public, have commercial value, and take corresponding confidentiality measures), they can be regarded as trade secrets. Where algorithms and data cannot find a better home, trade secrets are often the only physical weapon that holds the truth.
Article 7 adds another layer: phased results, failed experimental data and technical solutions also have commercial value as long as they meet the conditions. In other words, "unsuccessful" does not mean "worthless". A dead-end road itself is the R&D time saved by competitors - this is the subtlety of the legal theory of trade secrets.
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3. The ruler of confidentiality measures has been changed.
Among the three, the one most often failed in court is "confidentiality measures." Companies think that they can sit back and relax after signing a confidentiality agreement, but they don't know that a piece of paper cannot stop the determination of the same substance.
Article 9 recalibrates reasonable confidentiality measures. The fourth item is included in the "remote working and cross-border collaboration" scenario for the first time, requiring permission classification, data desensitization, and operation log traces; the sixth item requires access control on computers, networks, and storage devices. The meaning is very straightforward: A confidentiality agreement on paper is no longer enough to support the requirement of "taking confidentiality measures"; companies that have no technical traces and no authority to control will inevitably suffer in the future when it comes to providing evidence on the three genders.
Therefore, the standards for corporate compliance physical examinations have been quietly raised. To judge whether a company's confidentiality measures are adequate, you can't just count the number of agreements it has signed. You must also ask whether its logs can be retrieved, whether permissions are classified, and whether they are cleared after resignation.
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4. Changes in behavior: Improper means are used to complete "digitization", and the target is to leave the company with data
Article 10, in addition to "theft, bribery, fraud, and coercion", "electronic intrusion" is listed as an independent unfair means and is further classified into categories:
The third item refers to naming unauthorised access to digital office systems, servers, mailboxes, cloud disks, and application accounts, or setting up malicious programs and launching vulnerability attacks;
The fourth item is that after the expiration of the named authorisation period, the trade secrets are downloaded or transferred to an email or cloud disk that is not controlled by the rights holder without authorization.
The latter refers directly to the most frequent and difficult-to-prevent scenario - former employees change jobs and copy their data and customer records before leaving. In the past, the characterization of this type of behaviour often required repeated arguments, but now the provisions have prepared the corresponding format of "behavior type" for it. From now on, the evidence collection plan can be designed according to the third and fourth items of Article 10. The evidence will be directed more clearly and the identification will be more direct.
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5. Changes in procedures: Administrative route is an underestimated evidence collection tool
This is the point in the entire article that companies and lawyers should pay the most attention to, but is most easily passed over.
In trade secret cases, the biggest pain for rights holders is the difficulty in obtaining evidence - the infringement occurs in a closed environment controlled by the other party and is simply out of their reach. This regulation allocates two things to the administrative path:
First, low threshold. Article 18 stipulates that the rights holder only needs to provide "preliminary evidence that the information is a trade secret" and "specific clues of suspected infringement" to report and file a case. There is no need to get to the bottom of the infringement facts first.
Second, powerful tools. Article 23 gives the market supervision department the compulsory investigation power to enter business premises to inspect, inquire and copy account books and documents, seize and seize property, and even inquire the bank accounts of the operators involved.
This leads to a tactic: Administrative reporting can serve as a pre-evidence weapon in civil litigation. Using the compulsory investigation power of the public authority, fixing the two key facts of "substantial sameness and contact conditions", and then going back to the court to claim compensation - this is much less labor-intensive than the old method of "collecting evidence, notarizing, and prosecuting by yourself".
More importantly, Article 20, paragraph 2, embeds the core presumption in civil trials into administrative procedures: if there is evidence that the information used by the alleged infringer is substantially the same as the trade secret claimed by the rights holder, and there are conditions for obtaining it, the market supervision department can determine the infringement, unless the other party can prove that it was obtained or used legally. This is the administrative version of "contact plus presumption of substantial sameness and legal source defense" in the judiciary.
The pros and cons must be presented together, not just the good news. The advantage of the administrative approach lies in obtaining evidence; its disadvantage lies in compensation. The penalties in Article 24 - confiscation of illegal gains and a fine of not less than 100,000 yuan but not more than 1 million yuan, and in serious cases not less than 1 million yuan but not more than 5 million yuan - all the money will be returned to the state treasury, and the rights holders will not receive a single cent of compensation**. To make up for the losses and demand punitive damages, separate civil lawsuits are still required.
Therefore, administration and civil affairs are never a choice between two, but a combination of punches: use administrative compulsory investigation to break the evidence collection barrier, use civil judgments to obtain compensation, and use criminal pressure when necessary.
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6. Boundaries are also set: business secrets are not shackles to lock talents.
If the law only blindly "strengthens protection", it will slide into another kind of injustice - companies use trade secrets as a basket to include employees' abilities, and block the flow of talents in the name of competition.
Article 15 draws this line. Independent research and development, reverse engineering (disassembly, mapping, and analysis of products obtained through public channels), and whistleblowing disclosure based on public interests do not constitute infringement. The third item is particularly critical: former employees use the general knowledge, skills, and industry experience accumulated during work to carry out work, which generally does not constitute infringement**.
This article is a clear basis for defence for the defendants (former employees and new employers); it is a warning for the rights holders - claiming general skills as trade secrets will be blocked by this article. The so-called trade secrets protect "secrets", not "skills that everyone in the industry knows"; the two cannot be ignored.
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7. An offensive detail: Repeated infringement may lead to punishment
Item 4 of Article 26 lists "having committed an act of infringing on trade secrets again within two years after receiving an administrative penalty for infringing on trade secrets" as a serious case, which corresponds to the higher penalty in Article 24.
This logic of "recidivism after administrative punishment" is highly consistent with the "intentional and serious circumstances" required for civil punitive damages and the "subjective malice" valued by criminal liability. From this we can see a chain of evidence: an administrative penalty record can be used as hard evidence to demonstrate "subjective malice, repeated infringement, and infringement as a career" in civil claims in the future, and the administrative "penalty" can be multiplied by the civil "penalty". First establish prestige through administration, and then settle accounts through civil affairs, all linked together.
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8. Two boundaries to avoid using them incorrectly
First, this is a regulation, not a judicial interpretation. The court's civil trials are based on the Anti-Unfair Competition Law and the Civil Judicial Interpretation of the Supreme People's Court, and refer to the regulations rather than "in accordance with" them. Therefore, this regulation has direct binding force on administrative law enforcement, and is more of an interpretation reference and reasoning material for court litigation. The rank must be clearly marked when citing, and cannot be directly shouted out by the referee as a basis.
Secondly, administrative and civil affairs have different goals. The focus of administration is to stop violations, purify order, and return fines to the treasury; the settlement and punishment of rights holders still have to be done civilly. If you cannot see this layer clearly, you will mistake the report for a claim, which is a futile effort.
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Conclusion
In thirty-one years, the administrative track has evolved from blueprints to codes, and from workshops to cloud disks. What Really Changes in Order No. 126 is not the rights written on paper—the rights have long been established in Article 10 of the Anti-Unfair Competition Law; what it changes is the weight of the tools in the hands of companies and lawyers.
The protection of business secrets is never about "secret" but about "keeping". The ability to hold on depends not only on the signature on the agreement, but also on the traces in the log, the classification of authority, the removal when leaving the company, and - if necessary, whether you dare and whether you can borrow the administrative hand that has regained its strength.
*(The provisions of this article are quoted from the official text of the State Administration for Market Regulation Order No. 126 "Regulations on the Protection of Trade Secrets". The strategies involved in this article are general analysis and not legal opinions specific to individual cases.)*