Guide To Protecting Your Trade Secrets Under China’s New Regulations

On 24 February 2026, China’s State Administration for Market Regulation (“SAMR”) issued the Regulations on the Protection of Trade Secrets (Announcement No. 126 of the State Administration for Market Regulation), which will take effect on 1 June 2026 and replace the Provisions on Prohibiting the Infringement of Trade Secrets of 1995.

Overall, the new Regulations modernise China’s trade secret protection regime by aligning legal standards with contemporary commercial and technological realities.

By clarifying protection standards, refining the scope of protectable subject matter and confidentiality requirements, and strengthening enforcement mechanisms, the Regulations provide a clearer, more practical and more effective framework for the protection of confidential business information. 

Below, we provide key changes in the Regulations and provide an analysis of these for IP rights holders. 

Fundamental Rules on Trade Secret Protection 

1. Definition of “trade secrets” expanded (Article 5, paragraph 1) 

“trade secrets” refers to technical information, business information, and other commercial information that is not publicly known, has commercial value, and for which the rights holder has adopted corresponding confidentiality measures. 

To qualify as a trade secret, the information must satisfy three cumulative elements: non‑public nature, commercial value, and the adoption of corresponding confidentiality measures. 

As compared with the 1995 Regulations, which required trade secrets to possess both “economic benefits” and “practicality”, the new definition adopts the broader concept of “commercial value”.

This shift expands the scope of protection to cover commercial information with potential value that may bring commercial benefits or competitive advantages, making it possible to protect early‑stage research results and failed experimental data. 

2. Subject matters eligible for trade secret protection clarified (Article 5, paragraphs 2 and 3) 

Information related to technology, such as structure, raw materials, formula, materials, samples, patterns, processes, methods, data, algorithms, computer programs, and codes, falls under the category of technical information as defined in the first paragraph. 

Information related to business operations, such as creative content, management, sales, finance, plans, samples, customer information, and data, falls under the category of business information as defined in the first paragraph. Customer information includes the customer’s name, address, contact information, transaction habits, intentions, and related details. 

The above provisions significantly enhance the clarity and enforceability of trade secret protection by providing a more precise and structured categorisation of protectable subject matter. In particular, the explicit inclusion of data, algorithms, computer programs and codes reflects a clear policy shift toward safeguarding data‑based and information‑based assets, which have become increasingly critical to business competitiveness in the digital economy.

Notably, Article 7 of the Regulations clarifies that commercial value may be assessed by reference to factors such as shortened R&D cycles, increased transaction opportunities, cost reduction and improved commercial reputation, thereby providing a legal basis for treating intermediate results and even failed experimental data as trade secrets.

In addition, Article 6 further specifies that new information generated by organising, improving, or processing publicly known commercial information may also qualify as trade secrets. 

3. Scope of rights holders includes licensees & authorised parties (Article 8) 

The term “rights holder” as used in these provisions refers to the ownerof the trade secret and the licensee or authorised party of the trade secret who is authorised or permitted by the owner of the trade secret.

Compared with the 1995 Regulations, this provision expands the scope of rights holders beyond trade secret owners to include both licensees and authorised parties, thereby significantly broadening standing in enforcement proceedings and enhancing flexibility in the protection and enforcement of trade secret rights. 

4. Corresponding confidentiality measures updated and emphasised (Article 9) 

The corresponding confidentiality measures taken by the rights holder as referred to in these provisions shall mean reasonable confidentiality measures adopted by the rights holder to prevent the disclosure of trade secrets, which are appropriate in light of the nature of the trade secrets and their carriers, the commercial value of the trade secrets, and other factors.

The following situations constitute corresponding confidentiality measures adopted by the rights holder: 

(i) sign a confidentiality agreement or stipulate confidentiality obligations in the contract; 

(ii) establish rules and regulations, conduct training, and provide written notifications to impose confidentiality requirements on employees, former employees, suppliers, customers, visitors, and other persons who have access to or may obtain trade secrets; 

(iii) prohibit or restrict entry into classified production and operation sites such as factories, workshops, laboratories, and offices, or manage them separately; 

(iv) for scenarios such as remote work and cross-border collaboration, adopt technical confidentiality measures such as hierarchical access control, data anonymisation, and operation log recording; 

(v) trade secrets and their carriers shall be managed separately through measures including marking, classifying, isolating, encrypting, sealing, or restricting the scope of personnel who can access or obtain trade secrets and their carriers; 

(vi) take measures such as prohibiting or restricting the use, access, storage, or copying of computer equipment, network equipment, storage devices, etc., that can access or obtain trade secrets; 

(vii) require departing employees to register, return, remove, and destroy the trade secrets and their carriers that they have come into contact with or obtained, and to continue to assume confidentiality obligations; 

(viii) take other reasonable confidentiality measures. 

The core requirement for “corresponding confidentiality measures” is that such measures must be reasonable and appropriate in light of the nature of the trade secrets concerned, their carriers, their commercial value, and other relevant factors, reflecting a proportional and context‑specific approach.

By setting out a broad and non-exhaustive spectrum of measures that may be recognised as “corresponding confidentiality measures”, the Regulations encourage rights holders to establish layered internal control systems tailored to different risk scenarios.

In particular, to accommodate the realities of the digital economy, item (iv) expressly introduces technical safeguards for remote work and cross-border collaboration, such as hierarchical access control, data anonymisation, and operation log recording.

Collectively, these measures strengthen both ex ante prevention and evidence preservation, enabling rights holders to more readily establish a complete and coherent evidentiary chain in the event of infringement. 

Trade Secret infringement | standards and enforcement 

This section outlines how trade secret infringement is reported, investigated and determined.

1. Where to report trade secret infringement 

If a rights holder believes that their trade secrets have been infringed, they may report it to the market supervision and administration department (Article 17.1). 

2. Conditions for reporting trade secret infringement 

When reporting suspected trade secret infringement, the rights holder should provide prima facie evidence to prove that the relevant business information constitutes a trade secret, as well as specific clues indicating that the trade secret has been infringed, and should be responsible for the authenticity of the reported content (Article 17.2). 

According to Article 18, prima facie evidence may generally include materials demonstrating the formation process and timing of the business information, its non‑public nature, its commercial value, and the confidentiality measures adopted; and the specific clues may generally include indications that the suspected infringer had access to the trade secrets, destroyed confidentiality measures through improper means, obtained the trade secrets, or disclosed or used them, or created a risk of such disclosure or use. 

3. Standards for case acceptance 

Article 19 stipulates that, upon receiving a report of suspected trade secret infringement, the market supervision and administration department shall conduct an investigation in accordance with the law and decide whether to accept the case based on the following conditions: 

(i) there is preliminary evidence proving that an act of trade secret infringement has occurred, and administrative penalties should be imposed in accordance with the law; 

(ii) the case falls under the jurisdiction of the relevant department; and 

(iii) the case is within the statutory time limit for imposing administrative penalties. 

Both the rights holder and the suspected infringer may submit expert appraisals or professional opinions on technical issues, such as the public availability of the information (Article 22). 

4. Administrative enforcement measures 

Articles 21 to 23 impose strict confidentiality obligations on enforcement authorities while granting them broad investigative powers, including inspections, inquiries, evidence collection, and asset control. Together, these provisions improve enforcement efficiency while safeguarding trade secrets against secondary disclosure.

5. Criteria for establishing trade secret infringement 

Pursuant to Article 20, where there is evidence showing that the information used by the alleged infringer is substantially the same as the trade secret claimed by the rights holder, and that the alleged infringer had access to the trade secret, the alleged trade secret infringement may be established, unless there is evidence proving that the information used by the alleged infringer was legally obtained or used. 

Administrative liability and penalties 

Pursuant to Articles 24 to 26, once trade secret infringement has been established, the market supervision and administration department may take the following measures: 

1. To demand cessation of infringing acts, including:

 (i) requiring the infringer to stop using the trade secrets 

(ii) ordering the return or destruction of trade secret carriers 

(iii) ordering the destruction of infringing products or intermediates containing trade secrets 

(iv) requiring the removal of unlawfully obtained trade secrets, and 

(v) requiring the infringer to stop other acts that infringe upon the rights holder’s trade secrets.

2. To confiscate illegal gains derived from the infringement 

3. To impose administrative fines at RMB 100,000 to RMB 1 million, which can be increased to RMB 1 million to RMB 5 million for serious circumstances. 

Next steps and how we can help 

From a compliance perspective, enterprises are advised to strengthen their trade secret protection by adopting appropriate confidentiality measures and enhancing controls over data and sensitive information, with reference to the measures outlined in Article 9.

In particular, given the rapid pace of commercial and technological development, businesses should pay close attention to data‑driven assets, remote work arrangements, and cross‑border collaboration. The enhanced protection regime reduces infringement risks while enabling enterprises to respond promptly with a complete and coherent evidentiary chain.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.