A Preliminary Study on The Legal Effect of the Blockchain-Generated Data in Taiwan

A Preliminary Study on The Legal Effect of the Blockchain-Generated Data in Taiwan

I. Preface

  Governments around the world have set various regulations and guidelines to deal with the increasing application of blockchain technology, trying to keep the law up to date with technological development and the latest trends. Among them, the application of blockchain technology to regulations has become a hot topic. Because of its features, such as immutable, easy to verify and transparently disclosed, it can improve the efficiency of law enforcement and reduce cost. Moreover, decentralization and the verification mechanism generated by mathematical computation can avoid the disputes arising from the existing system, in which the mechanism is set up and controlled by independent institutions, and thus the credibility could be universal. The international trend also shows the importance attached to the application of blockchain technology in the legal field. In 2017, the “Legal Services Innovation Index”, a study conducted by the Michigan State University College of Law and Google evaluated the level of innovation of law firms according to the search data on innovation indicators of the world’s major law firms. Blockchain has the highest number of clicks among all indices, and the average number of clicks of blockchain is more than twice that of AI.[1] In addition, there are international cases regarding the connection between the blockchain technology and legal provisions as well as the real cases that used blockchain technology to handle legal matters.[2] An organization, such as the Global Legal Blockchain Consortium (GLBC), work with enterprises, law firms, software development units, and schools to study the standards formulation and application methods of the application of blockchain technology to law-related matters. [3] This article will first discuss the legal enforceability of data generated by the blockchain technology through international cases, then review Taiwan’s current status and the legal enforceability of the data generated by the blockchain technology and to explore possible direction for regulatory adjustment if the government intends to ease the restriction on the application of blockchain in the fields of evidence authentication and deposition.

II. International cases

1. US case: adjust the existing regulations and recognize the enforceability of blockchain technology

  The amendment HB2417[4] to the Arizona Electronic Transactions Act (AETA) signed by Arizona in April 2017 defines the blockchain technology and smart contracts and recognizes their legal effect on signatures, records and smart contracts. HB2417 defines “blockchain technology” as a “distributed, decentralized, shared and replicated ledger, which may be public or private, permissioned or permissionless, or driven by “tokenized crypto economics or tokenless” and provides that the “data on the ledger” is protected with cryptography, is immutable and auditable and provides an uncensored truth.” It’s worth noting that although, by definition, the data is true, it is uncensored truth in nature, which emphasizes the originality of the data. A “smart contract” is an “event driven program, with state, that runs on a distributed, decentralized, shared and replicated ledger that can take custody over and instruct transfer of assets on that ledger.” Under the original AETA regulations, records or signatures in electronic form cannot be deprived of legal validity and enforceability merely because they are in electronic form. To eliminate the legal uncertainty of any blockchain related transactions and smart contracts related to digital assets, HB 2417 states that a signature that is secured through blockchain technology is considered to be in an electronic form and to be an electronic signature, and a record or contract that is secured through blockchain technology is considered to be in an electronic form and to be an electronic record.  The statute also provides that smart contracts may exist in business, and a contract relating to a transaction may not be denied legal effect, validity or enforceability solely because that contract contains a “smart contract term.” This makes the enforceability of electronic signing and electronic transactions made by Arizona’s blockchain technology equivalent to that of the signature and contract made by the traditional written format. In the following year, the Ohio governor signed the amendment SB220[5] to the Uniform Electronic Transactions Act (UETA) in August 2018, which took effect from November. The focus of the amendment is the same as that in Arizona. Although, unlike HB 2417, SB220 does not define blockchain technology, the added content can still guarantee the enforceability of electronic signatures and contracts made by the blockchain technology. The focus of the two amendments in the US is to supplement and revise the laws and regulations made in the past so that they are applicable to the transaction method under blockchain technology and have the same effect as other recognized methods. This reduces the uncertainty related to blockchain technology at the regulatory and commercial application level, and is expected to attract the blockchain related companies, investors and developers.

2. Case of China: The enforceability of blockchain technology in evidence deposition is recognized in line with courts’ new type of judgment.

  In September 2018, the Supreme People's Court implemented “The Provisions on Several Issues Concerning the Trial of Cases by Internet Courts,”[6] in which Paragraph 2 of Article 11 mentions that where the authenticity of the electronic data submitted by a party can be proven through electronic signature, trusted time stamp, hash value check, blockchain or any other evidence collection, fixation or tamper-proofing technological means, or through the certification on an electronic evidence collection and preservation platform, the Internet court shall make a confirmation. It shows that the Internet court can recognize the evidence deposited by blockchain technology, and its enforceability is equivalent to that of other technologies if its authenticity can be proved. Paragraph 1 of the same article also proposes the basis for review and judgment on the relevant standards for the broad definition of electronic evidence recognition. “The authenticity of generation, collection, storage and transmission process of the electronic data shall be examined and judged, and the items to be reviewed include whether the hardware and software environments such as the computer system based on which electronic data is generated, collected, stored and transmitted are safe and reliable; whether electronic data originator and generation time are specified, and whether the contents shown are clear, objective and accurate; whether the storage and safekeeping media of electronic data are definite, and whether the safekeeping methods and means are appropriate; whether electronic data extractor and fixer, and electronic data extraction and fixation tools and methods are reliable, and whether the extraction process can be reproduced; whether the contents of electronic data are added, deleted, modified or incomplete, or fall under any other circumstance; and whether electronic data can be verified in specific methods.” The judgment is based on a clear review. It is a supplement to the notarization process, which was the solo judgment basis for the enforceability of digital evidence. In addition, the rules on proof are clearly set out in Article 9, which covers two situations: online and offline. For offline evidence, the parties can convert it into electronic materials by scanning, re-shooting and duplicating, and then upload it to the litigation platform. For online evidence, it can be divided into two situations. One is the online electronic evidence possessed by the party, which can be imported to the litigation platform by providing links or uploading materials. The other is that the Internet court can obtain the structural information of the relevant cases from the e-commerce platform operators, Internet service providers and electronic data deposition and retrieve platform, and import it to the litigation platform to directly provide the information to both parties so that they can select and prove their claims. In this way, the court can use technical means to complete the migration and visual presentation of information. Before the Supreme People's Court enforced the provisions, the Hangzhou Internet Court of China recognized the enforceability of electronic evidence under the blockchain technology when hearing a copyright dispute in June 2018. The court's judgment pointed out that after reviewing the impartiality, technical level and evidence preservation methods of the blockchain evidence deposit service provider, the enforceability of the evidence is recognized, and thus the case was deemed infringement.[7] Beijing Dongcheng District Court also reviewed the blockchain deposition technology in an infringement of information network communication in September of the same year, including data generation, deposition, preservation, and recognized the enforceability of electronic evidence made by the blockchain technology. The court adopted the electronic evidence[8]. The Beijing Internet Court allows evidence deposition of the litigation files and evidence uploaded to the electronic litigation platform through the Balance Chain of evidence deposition established by the blockchain technology when handling the litigation cases online. This can prevent tampering and ensure the safety of litigation while keeping possible litigation evidence to facilitate verification in the future. While the Balance Chain is going online, the supporting standards, including the Beijing Internet Court Electronic Evidence Platform Access and Management Standards, the Enforcement Rules of the Beijing Internet Court Electronic Evidence Platform Access and Management Standards, the Application Form for Beijing Internet Court Electronic Evidence Deposition Access and the Instruction on the Beijing Internet Court Electronic Evidence Deposition Access Interface, are released simultaneously. These supporting standards prescribe the requirement of receivers, the requirement for the electronic information system of the receiver and the requirement for the juridical application of the evidence platform in details from the practical point of view so that the potential receivers can interconnect in a compliant manner while ensuring the quality of the connected data.

III. Taiwan’s current situation

  In the above cases, the United States amended the laws and regulations related to the electronic transaction by increasing the scope of the terms, such as electronic forms of records, signatures and transactions so that the records, signatures and transactions made by the blockchain technology is as effective as that of other technologies. According to Article 9 of the Taiwanese Electronic Signatures Act, the enforceability of the data generated by blockchain technology shall still be judged case by case in terms of the technology for electronic documents, signature and transaction formation, and its applicability or exclusion shall be determined by laws or administrative agencies. In China, the role of electronic data is discussed in the relevant standards used by the Internet Court to examine the cases. Regarding the definition of electronic materials, electronic records and electronic documents, Paragraph 1 of Article 2 of the Taiwanese Electronic Signatures Act defines electronic document as a record in electronic form, which is made of “any text, sound, picture, image, symbol, or other information generated by electronic or other means not directly recognizable by human perceptions, and which is capable of conveying its intended information.”[9] In addition, Article 4 states “With the consent of the other party, an electronic record can be employed as a declaration of intent. Where a law or regulation requires that information be provided in writing, if the content of the information can be presented in its integrity and remains accessible for subsequent reference, with the consent of the other party, the requirement is satisfied by providing an electronic record. By stipulation of a law or regulation or prescription of a government agencies, the application of the two preceding paragraphs may be exempted, or otherwise require that particular technology or procedure be followed. In the event that particular technology or procedure is required, the stipulation or prescription shall be fair and reasonable, and shall not provide preferential treatment without proper justifications.” [10] The electronic records, regardless of the type of technology, are given the same effect as paper documents with the consent of both parties. In litigation, electronic records, electronic evidence or similar terms are not found in the Criminal Code of the Republic of China, the Civil Code, the Code of Criminal Procedure and the Taiwan Code of Civil Procedure. The adoption of electronic records often refers to Paragraph 2 of Article 220 of the Criminal Code of the Republic of China[11]. An audio recording, a visual recording, or an electromagnetic recording and the voices, images or symbols that are shown through the computer process and are sufficient evidence of intention shall be considered a document. The content that is considered meaningful is that the identity of the person expressing the content is identifiable according to the content and can be used to prove legal relationship or fact in social life. The relevant standards for proof under the electronic evidence follow Article 363 of the Taiwan Code of Civil Procedure[12]. For non-documentary objects which operate as documents, including those are accessible only through technological devices or those that are practically difficult to produce their original version, a writing representing its content along with a proof of the content represented as being true to the original will be acceptable. However, the way of proof or recognition standards are not sufficiently described. Or according to Paragraph 2 of Article 159-4 of the Code of Criminal Procedure, “documents of recording nature, or documents of certifying nature made by a person in the course of performing professional duty or regular day to day business, unless circumstances exist making it obviously unreliable. In addition”, and Paragraph 3 “ Documents made in other reliable circumstances in addition to the special circumstances specified in the preceding two Items.” [13] In fact, the Juridical Yuan started to promote the electronic litigation platform (including online litigation) in 2016, and has launched the online litigation business by gradually opening the application for different types of applicants and litigation.[14] However, there is no description on the technical type and inspection standards of electronic evidence. Moreover, only the litigation evidence is uploaded. There is no evidence deposition before litigation for comparison during litigation.

  Under Taiwan’s laws and regulations, electronic evidence and its proving method is not significantly different from other types of evidence. The judgment of evidence shall still depend on judges’ recognition on the evidence. Taking the practice of criminal litigation as an example, it can be viewed at three levels[15]: 1. The submission of the evidence. If the evidence is collected illegally, not following a statutory method or is not logically related to the pending matters, it will be excluded. This is the way to determine whether the evidence is eligible to enter the evidence investigation process. 2. In the investigation of evidence, the method of investigation (e.g., whether it is legal), the determination of relevance and the debate on evidence (e.g., to confirm the identity of the person producing the electronic evidence, whether the electronic evidence is identical to the original version without addition, deletion or alteration) are investigated during the investigation procedure. 3. The debate on evidence is to determine the power of the evidence by considering the relationship among the elements that constitute the whole and whether the evidence can prove the connection among all elements.  In addition, whether the electronic evidence is consistent with the original version is often based on Article 80 of the Notary Act, "When making notarial deeds, notaries shall write down the statements listened to, the circumstances witnessed, and other facts they have actually experienced. The means and results of the experience shall also be stated in the notarial deeds.” [16] A notary shall review the electronic evidence and record the inspection process and the inspection results to demonstrate its credibility.

VI. Conclusions and recommendations

  According to the latest 2050 smart government plan[17] announced in the Executive Yuan’s 3632nd meeting held on December 27, 2018, the government is planning to connect the database of each government agency through blockchain technology, and the plan also includes establishment of digital identification. It is foreseeable that there will be more and more electronic materials, documents and records connected by blockchain technology in the future. When it comes to improve management efficiency and reduce the barriers to introduce this technology to various sectors, it is necessary to adjust the related regulations. At present, there are no statutory provisions for the technology that assist the use of the electronic evidence involved in traditional litigation channels or online platforms, including using blockchain for evidence deposition and authentication . This also poses uncertainty to the judges when they make judgments. If we consider the continuous development and breakthrough of technology, which is relatively faster than the legislative process, and the traditional tangible transactions and contracts are still the majority in life, Taiwan has defined electronic materials, electronic records and electronic documents in the Electronic Signatures Act to ensure and strengthen the legal rights and benefits under the adoption of the technology. In addition, the Electronic Signatures Act also reserves the right to determine whether the technology is applicable to the laws and regulations or administrative agencies. In other words, the technology behind electronic materials, records and documents are not specified, and the aforementioned electronic materials have the same effect as the contracts and signature as the traditional written format. However, there are no standards to specify which standards are valid for evidence deposition and authentication for electronic materials on the level of deposition and authentication. In the future, when improving the relevant functions of the online litigation platform, the Juridical Yuan can also consider using technologies, such as blockchain or timestamps to provide evidence deposition service, which is expected to enhance the efficiency of evidence verification for online litigation in the future and prevent wasting review resources on invalid evidence for a better operation mode. This is in line with the government's policy direction. By providing support and demonstration of emerging technologies, not only limited to blockchain, on the legal level, it can reduce the public’s uncertainty and risk on introducing or applying the technology to legal process. This is very helpful in realizing a large scale application of the technology.


[1] Legal Services Innovation Index, Phase 1, Version 1.0, https://www.legaltechinnovation.com/law-firm-index/ (last visited on Jan. 11, 2019).

[2] For example, Arizona's Arizona Electronic Transactions Act (AETA) and Ohio’s Uniform Electronic Transactions Act (UETA) described the electronic signature and the enforceability of contracts under blockchain technology; in China, Beijing Internet Court provides litigation files and litigation evidence deposition service based on blockchain technology for future litigation.

[3] The Global Legal Blockchain Consortium website, https://legalconsortium.org/ (last visited on Jan. 11, 2019).

[4] H.B. 2417, 53th Leg., 1st Regular. (AZ. 2017).

[5] S.B. 220, 132ND General Assembly. (OH. 2017-2018).

[6]“The Provisions on Several Issues Concerning the Trial of Cases by Internet Courts,” the Supreme People's Court of the People’s Republic of China http://www.court.gov.cn/zixun-xiangqing-116981.html
(last visited on Jan. 11, 2019).

[7] Tencent Research Institute, <The era of judicial blockchain has arrived? ——from the two cases of blockchain electronic deposition>, October 23, 2018, https://ek21.com/news/1/132154/ (last visited on Jan. 11, 2019).

[8] Securities Daily, <Beijing Dongcheng District Court confirmed the evidence collection by blockchain for the first time-- application of "blockchain + justice" for new opportunities in history> October 20, 2018, https://www.jinse.com/bitcoin/258170.html (last visited on Jan. 11, 2019).

[9] Paragraph 1 of Article 2 of the Electronic Signatures Act

[10] Article 4 of the Electronic Signatures Act

[11] Paragraph 2 of Article 220, “A writing, symbol, drawing, photograph on a piece of paper or an article which by custom or by special agreement is sufficient evidence of intention therein contained shall be considered a document within the meaning of this Chapter and other chapters. So shall be an audio recording, a visual recording, or an electromagnetic recording and the voices, images or symbols that are shown through computer process and are sufficient evidence of intention.”

[12] Article 363 of the Taiwan Code of Civil Procedure, “The provisions of this Item shall apply mutatis mutandis to non-documentary objects which operate as documents. Where the content of a document or an object provided in the preceding paragraph is accessible only through technological devices or it is practically difficult to produce its original version, a writing representing its content along with a proof of the content represented as being true to the original will be acceptable. The court may, if necessary, order an explanation of the document, object, or writing representing the content thereof provided in the two preceding paragraphs.”

[13] Paragraph 2 of Article 159-4 of the Code of Criminal Procedure

[14] Liberty Times, <The Juridical Yuan is promoting “E-litigation.”  Two new systems are on the road.” August 1, 2018, http://news.ltn.com.tw/news/society/breakingnews/2506118 (last visited on Jan. 11, 2019).

[15] Chih-Lung Chen, “Seminar on the Reform of the Code of Criminal Procedure 3: Revision Direction of Rule of Evidence,” The Taiwan Law Review, Issue 52, Page 71-73 (1999).

[16] Article 80 of the Notary Act.

[17] BlockTempo, <The Executive Yuan Announced the Smart Government New Plan: the Taiwan Government will Use Blockchain Technology to Establish Information Exchange Mechanism of Various Agencies>, January 2, 2019, https://www.blocktempo.Com/taiwan-gv-want-to-use-blockchain-tech-build-data/ (last visited on Jan. 11, 2019).

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※A Preliminary Study on The Legal Effect of the Blockchain-Generated Data in Taiwan,STLI, https://stli.iii.org.tw/en/article-detail.aspx?no=105&tp=2&i=171&d=8253 (Date:2025/07/08)
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This suggests that despite the importance of IP to firms, many Taiwanese firms still have not integrated IP into their overall research and business strategies and utilize their intellectual property as a strategic tool in their business operations. Low Levels of IP Awareness and Training within Firms In order to gauge the level of IP knowledge and understanding in Taiwanese firms, the survey also contained 10 very basic questions on intellectual property. Surprisingly, the respondents that answered all the questions correctly were less than 4%. The proportion of respondents that correctly answered 5 or less questions did not even reach 50%. This means that Taiwanese firms still lack fundamental IP knowledge and understanding in general. This is also reflected in the response to the question whether the company has an overall IP policy in place, which also serves as an indication of the level awareness and concern with intellectual property within the firm. An IP policy that is distributed to company staff means that IP awareness is promoted within the company. However, almost 40% of the respondents claimed that there is no overall IP policy within the company, and nearly 30% of the respondents noted that even if there is an IP policy, it is not made widely known to company staff. This reveals that many Taiwanese companies still need to undertake more IP awareness promotion within the firm. More IP awareness promotion is also justified by the results to the question as to whether the company provides IP training for company staff. The results showed that almost 44% of the respondents do not provide any form of training in IP to company staff at all. This also corresponds to the result noted earlier that most respondents commit the least funding to providing IP training each year. Providing regular IP training to staff is certainly still not the norm for most Taiwanese firms. Issues facing businesses and their policy needs Taiwanese firms still faces many difficulties and challenges in their intellectual property management and hope that the government could provide them with the assistance and resources needed to help them enhance their intellectual property capacity and capability. Some of the major difficulties that the respondents pointed out in the survey include the lack of IP experts and professionals. It is difficult for firms to find and hire people with adequate professional IP skills, as the education and training currently provided by universities and professional schools do not seem to meet the actual IP needs of companies. Another major difficulty faced by Taiwanese firms is the lack of information and knowledge regarding international technical standards and standard setting organizations. A significant portion of the respondents expressed the wish for the government to help them gain entry and participation in international standard setting organizations. Among the other difficulties, the regulatory complexity and lack of clarity with the ownership of intellectual property arising from government-contracted research, which poses as barrier for firms in obtaining licenses for use and exploitation, is also an issue that the majority of the respondents hope the government could improve. In addition to the difficulties mentioned above that Taiwanese firms hope the government would help them encounter, the respondents were also asked specifically what other resources and assistance they would like to seek from the government. 69.4% of the respondents hope that the government could provide more training courses and seminars on IP. Many respondents are also seeking a common platform that can unify all resources that could help enhance IP management. Expert assistance and consultation on obtaining intellectual property rights and providing information on international IP protection and litigation are also resources that Taiwanese firms desire. More than 50% of the respondents also indicated that they would like to receive assistance in establishing IP management system within their firms. Conclusion The results of the survey provided insight into the level of IP management among companies in Taiwan. Although the importance of intellectual property for businesses is undeniable and widely recognized by firms, the results of the survey revealed that there is still much room for improvement and for Taiwanese firms to put in more efforts into strengthening and enhancing their IP capabilities. In general, Taiwanese firms have not incorporated their intellectual property into their management strategies and derived adequate value. Intellectual property remains mostly a defensive tool against infringement. 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It is also hoped that this survey would be carried out regularly in the future, and that the survey results from 2012 would serve as a baseline for future surveys that will assist in observing the progress Taiwanese businesses are making in IP management and provide a whole picture of the level of IP awareness and management within Taiwanese firms.

South Korea’s Strategy for Reinforcing Protection of Corporate Trade Secrets-Trade Secret Protection Center

Preface In order to increase the strength of addressing issues on the infringement of intellectual property for small and medium enterprises, Korean government launched Consultative Committee for Intellectual Property Policies, leading by Presidential Council on Intellectual property and conducting with Ministry of Culture, Sports and Tourism, Korean Intellectual Property Office and Ministry of Justice, to discuss how to reinforce efficiency on handling infringement of intellecual property and work on policy for intellectual property protection. Korean government has considered trade secret as the core of corporations; however, corporations think little of it. For this reason, Korea Institute of Patent Information’s Trade Secret Protection Section, in charge of the Trade Secret Protection Center, works to avoid the outflow of business skills and trade secrets, to improve trade secret protection system, to raise awareness of trade secret protection and develops South Korea as an intellectual property power. This article aims to briefly introduce the standard management system, the diagnosis of corporate trade secret and the Trade Secret Certification Service which are schemed out by the Trade Secret Protection Center. Explanation on Major Strategies Trade Secret Diagnosis & Standard Management System In an attempt to offer a diagnosis of current problems about trade secret management in corporations for drawing up suggestions for improvements, the Trade Secret Protection Center sets up a series of questions based on the five categories: organization policy management, document access management, staff management, physical management and information technology management. There are in total 32 questions with detailed sub-questions for knowing if corporations have set up regulations and if the regulations are followed; if the regulations are not followed, if they have strategy to tackle with violation. For example, the question for internet management is to examine on how corporation manages intranet and extranet. Some possible policies are to make them separated, to do authority control or to do nothing. Here is the procedure for diagnosis: 1.Preparation Employees are asked to gather information regarding trade secret management and improvement opinions by a questionnaire. 2.Diagnosis Get the result of how well corporation has done for trade secret management by analyzing the questionnaires. 3.Plan Come up with solutions according to diagnosis. 4.Action Provide suggestions with different levels of work. Level Description A (above 81 point, Excellent) Well-formed trade secret management and great operation B (71-80 point, Good) Limited strategy with law protection for trade secret outflow C (61-70 point, Average) Weak strategy with a lack of law protection for trade secret outflow, management needed D (41-60 point, Fair ) Poor law protection for trade secret outflow, management needed badly F (below 40 point, Poor) High Risk of trade secret outflow The Trade Secret Protection Center will examine and offer staff training periodically in an effort to improve following aspects: 1.Corporation Management (1)Avoid crucial information outflow (2)Systemize issue handling and information authentication process 2.Organization Culture (1)Convey the importance of information protection (2)Decrease the incoordination among departments due to protecting key information (3)Build trade secret protection culture 3.Staff (1)Provide long-term training for trade secret protection (2)Build up ability of trade secret protection The trade secret diagnosis is considered as a way to make trade secret the key intangible asset in corporations and even to increase the competitiveness and to create profits. In addition to the trade secret diagnosis, the Trade Secret Protection Center further provides immature business with the standard management system which contains services with trade secret registration, level distinguishments, authority control, staff management, contract management and certification service. The primary goal of the standard management system is to help with production and maintenance of trade secret certification before issue occurs. When issue happens, the system is right here to submit certification of trade secret and guarantee to the court that nobody can access trade secrets except the possessor of the trade secret and the institution. In other words, the system is intended for following goals: 1.Efficientize Trade Secret Management Save time, money and manpower. Manage trade secret and related information efficiently. 2.Raise Awareness of Trade Secret Protection Among Employees Strengthen awareness and application of trade secret protection by using this system as daily work process 3.Link to the Trade Secret Certification Service Prove the original document of trade secret with the time stamp of ownership for judicial evidences. 4.Link to Information Security Solution Cooperate with various information security solutions, such as trade secret control and outflow block. Trade Secret Certification Service The Trade Secret Certification Service which is built to link to standard management system is put into practice in 2010 by Korean Intellectual Property Office. This service operates by taking the hash values from trade secret e-documents and combining them with authorized time values from trusted third-parties, thereby creating time stamps. Time stamps are then registered with the Korea Institute of Patent Information to prove the existence of original document of trade secrets, as well as and their initial dates of possession. A legal basis is built for the Trade Secret Certification Service in 2014. Amendments of Unfair Competition Prevention and Trade Secret Protection Act indicate registration and proof of the Trade Secret Certification Service and explain that an institution with more than 3 qualified staff and required facilities is eligible to be a Trade Secret Certification Service institution. The Trade Secret Certification Service is characterized by the following properties: 1.Block Trade Secret Outflow Radically Instead of the trade secret itself, this service only asks for hash value of e-records and the authorized time of ownership which make it more secure for corporations to manage trade secrets rather than maintaining under a third-party. 2.Various Electronic Records Available Various types of electronic records are available in this service, such as documents, pictures and video files which could contain production process, laboratory notebook, blueprint, marketing records, financial records, selling information and customer information and contracts. 3.Institution with Credibility It is inevitable that any piece of information could be leaked out; hence trade secret management should be executed by credible institution. For example, corporation can ask the Trade Secret Certification Service Institution to register an original document for a blueprint and get a certification. Then, the corporation can ask for new registration for modified blueprint as well. When issue occurs, the certification would be the proof of original document and time of ownership. As the Trade Secret Certification Service Institution gets legalized, the evidence of original document of trade secrets and initial dates of possession would get more convincible in court. Conclusion The trade secret diagnosis plays an essential role in understanding the level of trade secret management in corporations. The standard management system further provides with improvement and solution for trade secret protection based on diagnosis. In addition, legalized Trade Secret Certification Service also levitates the burden of proof on corporation. South Korea’s experience in trade secret management could be a good example for Taiwan to follow.

The Introduction to the Trade Secret Management System Standard

The Introduction to the Trade Secret Management System Standard 2024/02/06 The “Trade Secret Management System”, released by the Science & Technology Law Institute of Institute for Information Industry on March 1, 2023, is a standard to guide organizations developing a systematic trade secret management system in alignment with relevant regulations and their operation objectives. Its aim is to assist the organizations reducing the risks of trade secret leakage while improving organizational competitive advantages. The Trade Secret Management System standard provides a framework for organizations to design, implement, and continuously improve their trade secret management performance. As defined in Article 2 of the Trade Secrets Act, "trade secret" could be any method, technique, process, formula, program, design, or other information that may be used in the course of production, sales, or operations, meeting following requirements: 1. It is not known to persons generally involved in the information of this type; 2. It has economic value, actual or potential, due to its secretive nature; and 3. Its owner has taken reasonable measures to maintain its secrecy. The Trade Secret Management System standard comprises a total of 10 chapters. The following is a brief overview of each chapter: Chapter 1: This chapter indicates the standard is applicable to all organizations regardless of their types, sizes, and the products or services they provide. It mentions that the organization can determine their management approached to meet the requirements of the standard. Chapter 2: This chapter provides the definitions of specific terms used in the standard. Chapter 3: This chapter introduces the top management’s responsibility to ensure the establishment, continuous appropriateness, completeness, and effectiveness of the trade secret management system. Chapter 4: This chapter requires the organization to define the scope of its trade secrets and ensure the defined trade secrets can be identified. This chapter also requires organization set up the permission to restrict access to personnel who need to know or use the trade secrets. Chapter 5: This chapter introduces the organization shall control the use of trade secrets, including actions such as copying, destruction, etc. Additionally, organization shall preserve the records of the aforementioned use of trade secrets and detect if any abnormal usage exists. Chapter 6: This chapter discusses measures the organization shall take for internal personnel control. These measures include regular training on trade secret-related requirements, signing of confidentiality agreements, and various management actions the organization should take throughout the processes of personnel recruitment, employment, and departure. Chapter 7: This chapter demonstrates the organization’s management of environments, equipment and internet involving its trade secrets. It requires the implementation of access control measures for places where trade secrets are stored or processed. It also stipulates controls on the use of record media and devices which can access trade secrets, as well as controlling the transmission of trade secrets via network. Chapter 8: This chapter introduces the management measures the organization shall take when interacting with other parties. These measures include signing non-disclosure agreement (NDAs) with the party who will access trade secrets and requiring such party not to hold the trade secrets once the corporation ends. Chapter 9: This chapter introduces that the organization shall establish a trade secret dispute resolution procedure to prevent or mitigate damages to the organization caused by disputes. Chapter10: This chapter outlines the supervision and the improvement of the trade secret management system of the organization. Organizations can follow the standard to build their own trade secret management system based on the Plan-Do-Check-Act (PDCA) concept. The trade secret management system would include defining trade secrets to be managed, establishing protocols for the use of trade secrets, managing employees, controlling of internet, devices and environment related to trade secrets, regulating external activities, developing trade secret dispute resolution procedure, and regularly monitoring the effectiveness to improve trade secret management performance. This standard could serve as a benchmark for the organization or third parties to evaluate compliance with expected trade secret managements.

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