Author: Attorney Mei Suzuki

Recent years have seen a rise in trade secret leakage incidents across Japanese companies and research institutions, highlighting the growing importance of information security. In 2025, Japan introduced major regulatory updates, including revisions to the Management Guidelines for Trade Secrets and the implementation of the Security Clearance System. This column outlines the essential points and the practical implications of these regulatory updates.

1. Trade Secrets Under Japanese Law

The Unfair Competition Prevention Act (hereinafter “Act”) defines trade secrets as information that is (i) managed as secret, (ii) useful for business activities, and (iii) not publicly known. Organizations must demonstrate clear intent to treat information as confidential, typically through confidentiality labels, access restrictions, log management, and non-disclosure agreements with employees and business partners.

2. Recent Trade Secret Leak Case and Court Ruling

A 2023 incident involving a former researcher at the National Institute of Advanced Industrial Science and Technology (AIST) drew nationwide attention. The researcher was accused of sending research data on fluorinated compounds to a Chinese company without authorization.

The defendant argued that the data did not constitute the AIST’s trade secret and that there was a possibility that another person had sent the information. However, the Tokyo District Court held that the data qualified as a trade secret under the Act because it was obtained through AIST’s controlled systems, that were subject to security measures. In February 2025, the defendant received a guilty verdict with both imprisonment and fines.

This case highlights that public research institutions also hold trade secrets and that internal actors may face criminal liability for unauthorized data removal. It underscores the need for universities and research institutions to strengthen their internal data management systems.

3. Key Points of the 2025 Revision of the Guidelines

Amid increasing complexity in information management and evolving working styles, the Ministry of Economy, Trade and Industry revised the Management Guidelines for Trade Secrets for the first time in six years. The revision incorporated new challenges, accumulated case studies, and provides countermeasures to handle trade secret leakage incidents.

Major Revisions in the 2025 Guidelines

(1) Inclusion of Universities and Research Institutions as “Business Operators”
The revised guidelines explicitly state that “business operators” under the Act includes universities and public research institutions. This reflects the increasing importance of industry-academia collaboration and international joint research. These institutions are now clearly expected to implement trade secret management measures.

(2) Addressing Remote Work and Multiple Employment

The rise of remote work, side jobs, and outsourcing increases the number of individuals who handle confidential information. The guidelines clarify that “employees, etc.” who are made aware of the secret management of the information of the company includes not only employees and executives but also external partners. The expected level of management measures is clarified for each category of information handlers.

(3) Cloud Services and Generative AI
As cloud systems and generative AI tools become widespread, the guidelines now include explanations on how secret management should be approached when using such tools.

(4) Reverse Engineering and the Dark Web
With regard to reverse engineering, the guidelines provide updated interpretations that state that if a product can be easily analyzed to reveal trade secrets, the information would no longer be considered as non-public. Conversely, if specialized skills or time-consuming processes/analysis is needed, trade secrets remain protected and the non-public nature would be maintained even if the product is released.

Regarding trade secrets leaked onto the dark web following cyberattacks, the guidelines emphasize that this does not automatically make them “public,” because access to the dark web requires specialized tools or knowledge.

4. Overview of the Security Clearance System

In May 2025, Japan introduced a Security Clearance System (the Act on the Protection and Utilization of Critical Economic Security Information) to restrict access to government-held sensitive national security information to pre-screened personnel. Only qualified organizations, including companies and research institutions, can access this information, and employees must pass background checks. Leaks may result in severe penalties, including imprisonment.

5. Conclusion

Incidents such as the AIST data leakage case demonstrate that improper handling of sensitive information has become a critical issue not only in corporations but also in universities and public research institutions. The 2025 revision to the Management Guidelines for Trade Secrets and the introduction of the Security Clearance System highlight Japan’s growing focus on protecting sensitive information. Nevertheless, many organizations still face challenges in building appropriate information management frameworks.

To protect Japan’s industrial and research capabilities, it is important for organizations to adopt up-to-date legal guidance, strengthen internal controls, and ensure robust protection of proprietary technologies and know-how.