Insight into Know-How Agreements

The World Intellectual Property Organization (WIPO) Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC) was established by WIPO in 2000 to ensure that arbiters and holders of traditional knowledge (“know-how”) are treated justly in intellectual property transactions. The European Union outlined provisions for the trade and protection of undisclosed information (“know-how”) in Directive (EU) 2016/943.[1] Such know-how is capable of generating profit and, thus, yields competitive value to the owner. This knowledge must be protected as intellectual property because its “unlawful acquisition, use or disclosure is likely to harm the interests of the person lawfully controlling it, in that it undermines that person’s scientific and technical potential, business or financial interests, strategic positions or ability to compete.”[2]

An advantage of know-how is that one can obtain immediate, indefinite and complete ownership. Unlike patents, know-how is not time-limited. Know-how may be obtained in a shorter amount of time than patents, which often require a lengthy approval process. Know-how – unlike patents – may cover all matter of subjects. There is no need to register or disclose know-how.  Know-how is often less costly to protect than patents. Like trade secrets, lawful reverse engineering, independent, or simultaneous discovery of something that is supposedly know-how may void or invalidate an entity previously thought to be know-how.[3] [4] In the United States, patents must be issued by the USTPO. Additionally, patents must be deemed as novel, non-obvious, and useful. Neither is necessarily true with regard to know-how. Yet, know-how may be communicated in either tangible or intangible form. Tangible communication of know-how includes “architectural plans of the factory buildings, the diagrams of the layout of the equipment in the factory, drawings or blueprints of machines…manuals or instructions for the operation of machines or the assembly of components…process flowcharts, packaging and storing instructions.”[5] Many of these elements are similar to what one would find in the drawings section of a patent application. Intangible communication of know-how includes advice or commentary on operations. [6]

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References:

[1] Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32016L0943

[2] Directive (EU) 2016/943 (14) of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32016L0943

[3] Frequently Asked Questions – Trade Secrets. World Intellectual Property Organization. Online https://www.wipo.int/tradesecrets/en/tradesecrets_faqs.html.

[4] Module 4. 4.1: Kind of Protection. World Intellectual Property Organization. Online: https://welc.wipo.int/lms/pluginfile.php/1969981/mod_resource/content/5/modules_r13/DL301E_M04_V2.0.pdf

[5] Id.

[6] Id.