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[ISN] New law eyed to counter industrial spies / Stealing secrets alone to be punishable


The Yomiuri Shimbun
Jan. 15, 2008

To prevent industrial spying that jeopardizes corporate secrets, the 
Economy, Trade and Industry Ministry has decided to push for the 
enactment of a new law that will enable authorities to more easily 
establish a criminal case against a spy once he or she takes 
confidential information from a company.

The theft or leaking of Japanese companies' proprietary technical 
information to overseas firms and governments is a growing concern for 
industries. Under the Penal Code, however, it is impossible to prosecute 
an industrial spy only for stealing confidential information. The new 
law is aimed at clamping down on espionage offenses and protecting 
companies' competitive strengths. The law also will aim to prevent 
technology that can be used for military purposes from being taken 
outside the firm or firms that own it.

The ministry also plans to revise the Patent Law so that patents on 
technology or ideas that are important in terms of security issues do 
not need to be made public.

The ministry intends to submit bills for both the new law and the 
revised Patent Law to the ordinary Diet session next year.

The Unfair Competition Prevention Law has served as the basis for 
prosecuting people for industrial espionage, which is regarded under the 
law as the offense of improperly accessing business secrets. However, it 
can be applied only when someone has leaked confidential information 
about a company that is important for its business to a rival company, 
thereby hindering fair competition. Moreover, the law requires that the 
person or company that has received the leaked information be 
identified, even if the firm is based overseas, which makes it extremely 
difficult to establish an industrial spying case. As a result, no 
industrial spy has been indicted under the law.

Also, if information that can be used for military purposes is leaked 
overseas or to a company that is not a rival of the owner of the 
information, such a case cannot be established under the law. What is 
more, stealing information is not regarded as theft under the Penal Code 
because the stolen information is neither money nor an object.

Therefore, the ministry has concluded there is a need to clamp down a 
wide variety of industrial espionage activities and breaches of security 
and is considering consulting on the matter at the Industrial Structure 
Council, an advisory panel under the economy, trade and industry 
minister, in spring after discussing details of the new law at a study 
group inside the ministry.

Under the ministry's plan, the new law will be designed to clamp down on 
theft of information and will be designed so that someone can be 
prosecuted only for intentionally obtaining and/or leaking company 
information that is important for its business operations and is 
generally treated as confidential information within the company.

In March, a Chinese engineer employed by Denso Corp. in Kariya, Aichi 
Prefecture, was arrested on suspicion of embezzlement in connection with 
taking a company computer containing product data. It was known at the 
time that he had returned to China three times at around the same time 
he had downloaded a huge amount of product design data. But the police 
were not able to establish whether the data had been handed to another 
company and gave up trying to build a case.

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