Two Giants Dancing at a Beautiful Chorus

Two Giants Dancing at a Beautiful Chorus

恰似巨人起舞时

——《中美第一阶段经贸协议》有感

Overview

There is a romance saying: Beauty dances with the beast. It gives a picture of thirst and hunger moving amid darkness and light. With this in mind, we must congratulate on the signing of the Economic and Trade Agreement between the United States of America and the People’s Republic of China Phase One ("China-US ET Agreement Phase One" or the "Phase One Agreement").

In a recent Chinese case Eli Lilly and Company v. Huang involving the misappropriation of trade secrets, Huang was an employee of a Chinese subsidiary of Eli Lilly and Company (together "Eli Lilly") in Shanghai. During the course of employment, Huang downloaded numerous documents from Eli Lilly’s database, many of which were marked confidential. Huang had entered into a confidentiality agreement with the Chinese subsidiary company. 

有一个罗曼蒂克的古语：美女与猛兽并舞。您捕捉到的图像是，大幕拉开，夜空和星光下动姿如饥似渴。当下，我们可以联想到并必须祝贺的是，《中华人民共和国和美利坚合众国第一阶段经贸协议》（“中美经贸第一阶段协定”或“第一阶段协定”）已经正式签署了。

在最近的一起涉及侵害商业秘密的礼来公司诉黄某案（Eli Lilly and Company v. Huang）中，黄某是礼来公司在上海的中国子公司的雇员。任职期间，黄某从该公司的数据库中下载了许多被标注为“机密”的文件。同时，黄某也与该公司签订了保密协议。

When requested to delete these confidential documents, Huang did not do so. Eli Lilly terminated Huang’s employment contract, and then sued Huang on grounds of infringement of trade secrets, seeking compensatory damage of RMB20,000,000. The Court issued an injunctive order, upon request, in accordance with Article 100 of the Civil Procedure Law (as amended in 2017). In granting the interim relief, the court considered the following elements: 

1) whether the alleged harm is occurring or about to occur;

2) whether there would be irreparable harm that could not be compensated by monetary compensation, if the requested relief were not granted;

3) whether appropriate security has been provided;

4) relevant public interest issues.

The first three factors are what the Civil Procedure Law provides under Article 100. In the case, Eli Lilly provided security in the amount of RMB100,000, to satisfy the requirement 3) above. The last element appears to be discretionary standards developed by the court in Shanghai.

当黄某拒绝了删除上述机密文件的要求时，公司遂解除了黄某的雇佣合同，然后以侵犯商业秘密为由起诉黄某，并要求他赔偿公司损失人民币2000万元。受案法院根据《中华人民共和国民事诉讼法》（2017年修订）第100条的规定，裁定对黄某采取行为保全措施。在权衡是否核准行为保全措施时，受案法院考虑了以下因素： 

1）所指称的损害是否正在发生或即将发生；

2）如果没有给予所要求的救济，是否存在通过金钱赔偿仍不可弥补的损害；

3）是否提供了适当的担保；

4）相关的公共利益问题。

前三个条件是《中华人民共和国民事诉讼法》第100条的规定。在此案中，涉案公司提供了人民币100,000元的担保，以满足第三项条件的要求。最后一个条件是受案法院自由裁量中创设的标准。

It is encouraging that the China-US ET Agreement Phase One has a special section on the protection of trade secrets in both China and the US. The new provisions introduced under the Phase One Agreement include the scope of prohibited acts, shifting of burden of proof, provisional measures and criminal enforcement. They will serve as bilateral treaty provisions and foreseeable legal rules for protection of trade secrets for businesses and individuals in the two giant countries.  

The "trade secrets" of the successful signing of the Phase One Agreement is apparently that both governments adopted a pragmatic approach to resolve economic and trade issues by negotiating long hours and reaching a written agreement, instead of using domestic administrative orders of imposing high tariffs on import and export of goods. These high tariff orders ultimately increase the costs of the goods for the consumers of the respective societies.

The Phase One Agreement covers many important areas including intellectual property, technology transfer, agriculture, financial services, currency, expanding trade, and dispute resolution. It is particularly worth noting that the dispute resolution provisions create a regular bilateral consultation mechanism at both the principal and working level. This type of mechanism may serve a reference point for long term projects in different sectors of private industries in the future as well, from the value of dispute prevention perspective.

令人鼓舞的是，《中美第一阶段经贸协定》有一个特别的小节，其内容正是涉及保护中美两国的商业秘密。新引入的条款包括禁止侵害商业秘密的行为、证明责任移转以及临时措施和刑事救济。这些条款将为两边的企业和个人提供双边协定保障和可预见的法律规则，保护两个大国之间的商业秘密。

第一阶段协定成功签署的“秘诀”是两国政府努力通过更加务实的方式来解决经贸往来中涉及的摩擦。相较于单纯使用国内行政命令对进出口征收高额关税，双方通过长时间谈判并达成书面协议的方式是更务实的途径。因为，通过增加的关税将会增加双方社会的商品成本，并最终损害普通消费者的利益。

第一阶段协定涵盖了许多重要议题，包括知识产权、技术转让、农业、金融服务、货币、扩大贸易和争端解决。值得一提的是，争端解决的章节拟定在两国高层和工作层面建立定期的双边磋商机制。从预防纠纷的价值来看，这种机制也可能为私营部门之间未来有关长期合作机制中的争议解决条款的设计提供参考。

It is worth noting how the courts of respective countries and other government agencies (such as SIPO and USPTO) may work together in the future to give judicial or administrative assistance to the parties in the respective countries in cross-border trade and economic relations. In this respect, the Arrangement Concerning Mutual Assistance in Court-ordered Interim Measures in Aid of Arbitral Proceedings by the Courts of the Mainland and of the Hong Kong Special Administrative Region (HKSAR) ("Interim Measures Arrangement") recently signed on 2nd April 2019 has special value for cross-border court assistance to the protection of intellectual property rights in arbitration proceedings.

The reason is efficiency and mutual benefit. The arbitrators may avail themselves of the emergency arbitration proceedings to quickly order an interim measure to stop any immanent happening of infringement of intellectual property rights, and the courts in the Mainland may act to take interim measures to enforce against infringement activities according to the standards developed in the cases such as the above-mentioned Eli Lilly case involving infringement of trade secrets rights.

 另外，未来两国法院或者职能部门（比如国家知识产权局和USTPO）如何通过加强合作，以更好地在跨境贸易和经济关系中为两国当事人提供司法和行政的协助，是值得关注的议题。在这方面，于2019年4月2日签署的《关于内地与香港特别行政区法院就仲裁程序相互协助保全的安排》对于跨境法院在仲裁程序中强化对知识产权的保护具有特殊价值。 

这背后的理念价值是效率和互利互惠。仲裁员可以利用紧急仲裁程序迅速采取临时措施，以制止任何即刻发生的侵犯知识产权行为。中国法院则可以根据上述礼来公司案中制定的标准，采取临时措施制止可能侵犯商业秘密的行为。