Introduction
As high quality and cheap labors were available in China previously and therefore foreign companies, including Japanese companies manufactured products in China and sold them all over the world. Due to the increase of labor cost, this business model could not be maintained by Japanese companies. It is, however, unable to ignore 1.3 billion market, thus the Japanese companies continue to manufacture in China and sell them in China.
For those Japanese companies staying in Chinese market, the protection of their trade secrets is critically important. Recent Chinese employees do not stay in the same company long. They normally do not care of using trade secrets of Japanese company.
In China, the legal system of protecting the trade secrets has been developed by new laws, judicial interpretations and court precedents.
The key is to administrate the trade secrets appropriately and educate the Chinese employees of the legal implications of the protection of trade secrets, including damage claims and criminal sanctions imposed on them upon the trade secrets infringement.