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What Has Labour Contract Law in China to do with IP?

According to article 39 TRIPs undisclosed information, including trade secrets, shall be protected by the WTO members, including China. Now Steven Dickenson of the prolific China Law Blog wrote an article for China International Business about China's new labour contract law, which will go into effect on January 1, 2008.

So what is relevant to intellectual property in China?

Mr Dickenson writes:
"Non-competition agreements restricted. Many foreign employers require most or all of their Chinese employees to enter into non-competition agreements that restrict their right to work for a competitor after termination of employment. The LCL imposes significant restrictions on the use of these agreements. The most important restriction is that non-compete agreements cannot be imposed on all employees. Only senior management and other employees with access to critical trade secrets can be required to enter into a non-competition agreement. The agreement must be limited in duration to two years, must be limited in geographic scope to a reasonable area and the employer must pay compensation to the employee during the period that the non-competition restriction is in effect."

Read Mr Dickenson's article 'Power to the People' here and Dan Harris' blog on China Law Blog here.

Read China's labour contract law in English here, in Chinese here.

Full post as published by IP Dragon on November 15, 2007 (boomark / email).