On Non-competition Agreement Of Trade Secret

The disclosure of trade secrets caused by talents flow is an indisputable fact,Non-competition agreement ,as an important part of the Prohibition of business strife,has been one of the important methods to protecting trade secrets. In China, Prohibition on business strife system started relatively late, the legislation about Non-Competition agreement mainly focus on the department regulations and local legislation. On Jan1, 2008, the promulgation and implementation of the"the People's Republic of China on Employment Contracts"(hereinafter referred to briefly as"Law on Employment Contracts") confirmed the legal status of promissory prohibition on business strife. However, the provisions on"Law on Employment Contracts"are generally principles; the lack of more specification about Non-Competition Agreement caused some disputes and problems in practice. This paper combines several typical cases happened in China to make an in-depth analysis on the issues related on Non-Competition agreements. This paper starts from introducing the basic theory of prohibition on business strife and introducing legislations about Non-Competition agreement domestically and internationally, then this paper emphasizes on analyzing the elements of Non-Competition agreements and liabilities of violations on Non-Competition agreement. This paper still learns from legislation and practice of foreign prohibition on business strife, combined with the actual situation in China, gives some suggestion to perfect Non-Competition Agreement in China.In addition to the introduction and the conclusion, this paper is divided into four parts:Introduction mainly lists several typical cases happened in China recently years, and then points out the main problems on Non-Competition agreement In China.First part mainly introduces the basic concepts of Non-Competition agreement. The author analyzes the legal natures of Non-Competition agreement, and points out the advantages of using Non-Competition Agreement by making some research in comparison with Non-disclosure agreement, statutory Non-competition, inevitable disclosure theory. At the end of this part, the author demonstrates the theory of Non-Competition agreements on protecting trade secrets.The second part: after introducing the relevant legislations on the effective elements of Non-Competition agreements at home and abroad, the author mainly points out the available constitutions of Non-Competition agreement in China. And by combining the typical cases happened in China, the author analyzes seven elements one by one in-depth, and expounds the reasonable restrictions of each element, such as the business scope, geographic scope, reasonable period of time, financial compensation standards, and so on. Finally, the author analyzes the situation of terminating the Non-Competition agreements.The third parts focuses on analyzing the liabilities of breach of the non-competition agreements .First the author analyzes how to judge the situation of breaching the agreement ,and then expounds the liabilities on three parts: firstly, employer's liabilities includes performance of obligation, liquidated damaged payment, compensation for damages, and termination of Non-Competition agreements; secondly, the liabilities of employees ,thirdly, the author makes some research on the new employers'liabilities by combining two typical cases.The fourth part is the key point of this paper, through the above analysis; the author proposes four suggestions to perfect the Non-Competition Agreement system. Firstly, the author figures that the Non-Competition Agreement should be regulated at the level of legislation law of the National People's Congress clearly. secondly, according to the different situations, the time limitation should be regulated in a more flexible way; thirdly, the legislative at the level of National People's Congress should make an reference standard economical compensation, and the methods of payment can be more flexible; fourth, it should stipulate various cases clearly where new employer assumes liabilities under the theory of third party trespass.