The Stand Committee of China’s National People’s Congress submitted the revised draft of China’s Anti-Unfair Competition Law on February 22
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, which is revised for the first time in the past 24 years. Here are several points companies and their employees should note while doing business in China following the proposed new amendment:
1.
Using others’ unregistered well-known trademarks will be punished.
Under the new amendment, if an enterprise uses others’ registered trademark OR unregistered well-known trademark as its enterprise name, with an intention to mislead the public, it would be regarded as an act of unfair competition, which infringes consumers’ rights to know and choose, and damages the principle of fair dealing.
2.
Resigning employees should not reveal trade secrets of former employers.
In accordance with the new amendment, even if there is no explicit agreement in the labor contract that resigning employees cannot reveal trade secrets of the former employers, this action will be strictly prohibited by the revised Anti-Unfair Competition Law. Where a resigning employee reveals trade secrets to a new employee, the new employee would also be punished under the new amendment. Important to the legal profession, the new amendment also adds provisions on the obligation for lawyers and certified accountants to maintain secrecy of the trade secrets they obtain while performing their duties.
3.
Prohibiting unfair competition on the internet for the first time.
The amendment introduces for the first time provisions addressing unfair competition in the field of the internet. Competitors are not allowed to use technological means on the internet to influence the consumers’ choices and disturbing other competitor’s normal operations.