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Trade secret according to ZJN-3

The new Trade Secrets Act (Zakon o poslovni skrivnosti, ZPosS) has been in force since the spring of 2019, the purpose of which was to comprehensively regulate the area of trade secrets. At first glance, trade secret protection is a relatively secondary topic in public procurement procedures; however, the unlawful disclosure of trade secrets can have dire consequences for the tenderers and can result in liability for damages for the contracting authorities.

ZJN-3 does not contain the definition of a trade secret, so the definition from ZPosS is used. Information that is public by nature or information on breaches of law or good business practices cannot be designated as a trade secret.

Article 35 of ZJN-3 prohibits contracting authorities from disclosing information submitted by the economic operator that is designated as a trade secret. The contracting authority is not obligated to double-check whether a piece of information that had not been marked by the tenderer as a trade secret is perhaps a trade secret. Public information is always data that the tenderers that had not been selected need to verify whether the contracting authority’s decision regarding the public procurement was lawful. Even if the tenderer marks any of the stated information as a trade secret, the contracting authority may not preserve it as secret and is obligated to disclose it.

Trade secret protection is guaranteed in all phases of the public procurement procedure. The earlier phases place more emphasis on confidentiality, while later phases enable more access to the information.

No one other than the contracting authority and the National Review Commission for Reviewing Public Procurement Award Procedures (DKOM) can be familiarized with the trade secrets during the entire public procurement procedure and even after its final completion.

In practice, the question of references is often contested: the contracting authority can specify that the economic operators must have sufficient experience to carry out the public contract, which are demonstrated with relevant references of past contracts. However, the contracting authorities from previous contacts may not be inclined to reveal the existence of such public contract information. Can references be designated as a trade secret, even though they may influence the ranging of the offers? Read the article in Pravna praksa to find out.

The article by attorney Borut Leskovec has been published in Pravna praksa, no. 2019/33, pages 6-8[1].

1. https://www.pravnapraksa.si/Lite/Besedilo.aspx?SOPI=L010Y2019V33P6-8N1&Src=S5hkKPGy/wfg6+fs9cI4DGiLKAHew0rh