Under the wave of globalization, more and more companies choose to expand their business in Vietnam. In this market full of opportunities, how to protect the core assets of enterprises – trade secrets has become the key to the success of enterprises. Vietnam’s manufacturing industry is in a stage of rapid development, and competition among enterprises is becoming increasingly fierce. The protection of trade secrets is not only related to the market position of enterprises, but also directly affects their future survival and development. This article will explore in depth the definition of Vietnamese trade secrets, the legal background and the protection measures that enterprises should take, and provide practical guidance and suggestions for enterprises that are or plan to enter the Vietnamese market.

1. What is a trade secret?

Trade secrets refer to undisclosed information that a company possesses during its business operations, which usually includes technical know-how, production processes, customer lists, marketing strategies, etc. The core characteristics of trade secrets are their confidentiality, commercial value, and the need to protect them through reasonable measures. For manufacturing companies, trade secrets are often the key to maintaining competitive advantages because they directly affect the company’s production efficiency, product quality, and market positioning.

In Vietnam’s manufacturing industry, trade secrets are particularly important. As Vietnam is in the process of industrialization, many companies rely on unique technology and management experience to gain a foothold in the fierce market competition. Therefore, protecting trade secrets not only helps companies maintain their leading position, but also prevents potential market competitors from obtaining core information of companies through improper means.

Legal Background of Trade Secret Protection

The protection of trade secrets in Vietnam is regulated by multiple laws, the most critical of which are the Intellectual Property Law and the Labor Law. According to the Vietnamese Intellectual Property Law, trade secrets are defined as “information that is not known to the public and has commercial value”, and companies have the responsibility to take reasonable measures to protect this information from being disclosed or abused. In addition, the Labor Law also stipulates the confidentiality obligations of employees during their employment and after leaving the company, which provides a legal basis for the protection of companies’ trade secrets.

However, if an enterprise fails to take effective protection measures, its trade secrets may face the risk of being stolen or leaked. This will not only lead to a decline in the market competitiveness of the enterprise, but may also lead to legal disputes and even threaten the survival of the enterprise. Therefore, enterprises must establish a sound trade secret protection system to ensure sustainable and steady development in the Vietnamese market.

2. Physical and Technical Protection Measures

2.1 Office Environment Safety

In Vietnam’s SMEs, physical security of the office environment is the basis for the protection of trade secrets. First, a strict access control system should be implemented in offices and production workshops to ensure that only authorized personnel can enter specific areas. This can be achieved by using smart cards, fingerprint recognition or other advanced authentication technologies. In addition, installing surveillance cameras in important areas to monitor and record entry and exit in real time can help prevent unauthorized personnel from accessing sensitive information.

The security of file storage should not be ignored. Companies should equip important files with dedicated safes or locked cabinets to ensure that only specific personnel can access these files. At the same time, avoid storing sensitive files on ordinary desks or in unsafe places to prevent accidental leakage.

2.2 Information Technology Security

In the digital age, IT security is essential to protecting trade secrets. First, companies must ensure that all sensitive data is encrypted, whether stored on local devices or in transit. Encryption can effectively prevent data from being easily interpreted if it is intercepted or leaked.

Secondly, network security protection is another key link. Enterprises should configure firewalls and virtual private networks (VPNs) to protect internal and external network communications and prevent hacker attacks and data leaks. At the same time, enterprises should take measures to isolate the internal network from the external network to prevent external threats from invading the core network of the enterprise.

2.3 Document and Data Management

The management of documents and data requires systematic measures to ensure the security of trade secrets. Enterprises should implement a document identification and classification management system to classify documents of different sensitivity levels. For example, for highly sensitive documents, enterprises can stipulate stricter access rights and management processes.

In addition, the backup and recovery strategy of important data is also a key link. Enterprises should regularly back up key data and ensure that the storage location of the backup data is safe and reliable, and have the ability to quickly recover in case of sudden data loss or damage.

Finally, data access permission control and logging are effective means of monitoring and managing information access. Enterprises should limit the scope of personnel who can access sensitive data and record logs of all data access operations so that they can be tracked and reviewed when security incidents occur. This not only helps prevent misconduct, but also quickly locates the source of the problem after the incident occurs.

3. Personnel Management and Training

3.1 Employee Confidentiality Agreement

In Vietnamese manufacturing enterprises, employees’ confidentiality awareness is crucial, so signing a confidentiality agreement before and after employment is the first step. Enterprises should ensure that all new employees sign a confidentiality agreement before they officially join the company to clarify their confidentiality obligations during and after work. The content of the agreement should include the definition of trade secrets, employees’ confidentiality responsibilities, the consequences of information leakage, and legal liability clauses. It should be emphasized that enterprises need to formulate corresponding confidentiality requirements according to different positions and responsibilities to ensure that the content of the agreement is targeted and enforceable.

3.2 Training and awareness raising

In order to strengthen employees’ confidentiality awareness, companies should conduct regular training on the protection of trade secrets. The training content should include the scope of the company’s trade secrets, possible ways of leakage, and preventive measures. Through vivid case analysis, employees can more intuitively understand the importance of confidentiality and the serious consequences of leakage. In addition, simulation exercises are an effective way to improve employees’ ability to deal with emergencies and help employees better protect the company’s trade secrets in actual work.

3.3 Employee Resignation Management

When an employee leaves the company, the company must conduct a strict confidentiality review to ensure that all sensitive information the employee has accessed during his/her employment is properly handled. The resignation review should include measures such as returning all confidential documents and equipment to the company and closing access rights to relevant systems. At the same time, the company should establish a continuous supervision mechanism after resignation and, if necessary, use legal means to ensure that trade secrets are not leaked or abused. This series of measures will help companies effectively prevent the risk of trade secrets leaking due to employee resignation.

4. Partner and Outsourcing Management

4.1 Partner Confidentiality Agreement

In Vietnam’s manufacturing industry, it is essential to maintain good working relationships with suppliers and customers, but at the same time, it is also necessary to ensure that business secrets are not leaked. Therefore, companies should sign strict confidentiality agreements with all partners, suppliers, and customers before the start of cooperation. These agreements should clearly stipulate the parties’ responsibilities for protecting business secrets during and after the cooperation to ensure the security of information. In addition to signing a confidentiality agreement, it is also necessary to conduct a thorough background check on outsourcers and partners to assess their reliability and confidentiality capabilities. This step not only helps identify potential risks, but also enhances the stability of the partnership.

4.2 Security of Information Sharing

When sharing information with partners, the principle of minimization should be followed, that is, only necessary information should be shared and excessive disclosure should be avoided. During the cooperation period, enterprises should strictly control the flow of information to ensure that each party can only access limited information related to its functions. In addition, after the project is completed, enterprises should promptly recover, destroy or safely store all shared information to prevent unauthorized use or disclosure. Through these measures, enterprises can effectively reduce the risk of information leakage and protect their own business secrets.

5. Emergency Response Measures

5.1 Early warning mechanism for trade secret leakage

In the protection of trade secrets, prevention is more important than remediation. Therefore, identifying common leakage channels and establishing an effective early warning mechanism is a link that enterprises must pay attention to. Common leakage channels include unintentional leakage by employees, malicious internal personnel’s behavior, improper information exchange with external partners, etc. These situations may manifest as abnormal behaviors such as employees’ frequent access to sensitive information, unauthorized file downloads, or discussing confidential information in public. By establishing a strict monitoring system, enterprises can detect these abnormal situations in time and take prompt action.

In order to further strengthen the early warning mechanism, companies should set up internal reporting channels to encourage employees to anonymously report any possible leakage of trade secrets. The establishment of reporting channels can not only detect potential risks in a timely manner, but also enhance employees’ sense of responsibility and participation, making them an important part of the company’s trade secret protection.

5.2 Emergency response to leakage incidents

Even with all the preventive measures, companies still need to be prepared to deal with trade secrets leaks. The first step is to establish a professional emergency response team, which should be composed of legal counsel, information technology experts and senior management to ensure that effective measures can be taken quickly after the incident occurs. The responsibilities of the emergency response team include determining the scope of the leak, assessing the impact of the leak, and taking immediate remedial measures to minimize the losses.

When dealing with a leak, companies should follow a standardized emergency response process. First, the source of the leak should be cut off immediately to protect the remaining trade secrets. Next, evidence should be collected and an internal investigation should be conducted to identify the person responsible and the cause of the leak. Finally, based on the results of the investigation, appropriate legal accountability measures should be taken to ensure that the person responsible bears the due legal consequences and to recover the company’s losses through legal means. This rigorous emergency response can not only effectively respond to leaks, but also deter potential leaks and protect the core interests of the company.

6. Regular review and update

6.1 Regular evaluation of protection measures

In order to ensure the effectiveness of trade secret protection measures, enterprises should conduct internal reviews regularly. This process includes not only the evaluation of existing protection measures, but also improvements to possible loopholes. For example, regular inspections of the physical security of office premises, review of the need to update information technology systems, and assessment of whether employees’ confidentiality awareness remains at a high level. In addition, with the development of the industry and the advancement of technology, new risks and challenges continue to emerge, so enterprises should take the initiative to adjust and upgrade their protection measures according to the latest industry trends and technological advances to ensure that trade secrets are protected in the most comprehensive way.

6.2 Changes in laws and industry standards

Vietnam’s laws, regulations and industry standards may change over time, which puts new requirements on the protection of business secrets. Enterprises need to keep track of these changes and ensure that their internal policies and practices are in sync with the latest legal requirements. This includes timely adjusting confidentiality agreements, updating information protection strategies, and ensuring that all employees and partners are aware of and comply with new regulations. In addition, enterprises should communicate with legal counsel or industry experts regularly to quickly respond to the potential impact of policy changes, thereby maintaining compliance and competitiveness in the Vietnamese market.

7. Conclusion

In Vietnam’s business environment, trade secret protection is crucial to the sustainable development of enterprises. Effective trade secret protection measures can not only help enterprises prevent the leakage of key assets such as core technologies and customer information, but also ensure that they maintain their leading position in the fierce market competition. In order to protect the long-term interests of enterprises, it is particularly necessary to formulate and implement a systematic, comprehensive and long-term trade secret protection plan. This plan should include multiple measures at the physical, technical and management levels to ensure that enterprises can effectively protect their trade secrets in different situations.

At the same time, enterprises often face complex legal and technical issues when formulating and implementing trade secret protection measures. Therefore, we strongly recommend that enterprises seek help from professional consulting services when necessary. By working with experienced legal advisors and information security experts, enterprises can develop more practical and personalized protection plans based on their specific circumstances. This will not only help improve the protection effect of enterprises, but also minimize legal risks and ensure the long-term and stable development of enterprises in the Vietnamese market.