Economic Espionage and Trade Secrets (Essay Sample)

Economic Espionage and Trade Secrets Student name Institution Name Abstract The quest for economic supremacy both at the private and government levels provides a fertile breeding ground for illegal and unthematical acts such as economic espionage and misappropriation of trade secrets. Such unethical acts destroy the diplomatic relations between nations. At the corporate level, misappropriation of trade secrets can result in a firm accruing significant financial losses. Consequently, this paper explores the instrumental concepts of economic espionage and misappropriation of trade secrets with the goal of outlining their effects on organizational activities and how to prevent them. The reviewed materials point out that economic espionage and misappropriation of trade secrets are challenging vices to combat despite the existence of stringent policies. As such, experts advise that firms should use strategies such as non-disclosure agreements and limiting the physical and electronic access to confidential files to ensure the safety of trade secrets. Economic Espionage and Trade Secrets The economic sector is highly comparative both at the government and private level. At the private level, firms strive to outdo each other with the aim of gaining competitive advantage. Equally, countries compete at the international level with the intention of enhancing economic stability. Consequently, this quest for economic supremacy both at the private and government levels provides a fertile breeding ground for the illegal and unthematical acts such as economic espionage and misappropriation of trade secrets. Such unethical actions destroy the diplomatic relations between nations. At the corporate level, misappropriation of trade secrets can result in a firm accruing significant financial losses. As a result, governments have devised strict policies to combat these two vices. Consequently, this paper explores the instrumental concepts of economic espionage and misappropriation of trade secrets with the goal of outlining their effects on organizational activities and how to prevent them. The Economic Espionage Act of 1996 (EEA) describes economic espionage as the as the misappropriation of trade secrets with the intention of benefiting a foreign government, foreign instrumentality or a foreign agent (Sims & Gerber, 2008). A trade secret, in this case, is confidential business information that serves as the fundamental competitive tool for a company. For instance, in a chemical manufacturing firm, the documents entailing all the formulas to develop the various chemicals serve as the company’s trade secret. According to Sims and Gerber (2008), the United States attorney general points out that economic espionage targets sensitive financial, trade, and economic policy information. Before the enactment of the Economic Espionage Act of 1996 (EEA), a policy gap exited in addressing economic espionage-related claims. According to Jarrett (2009), before EEA, prosecutors lacked effect tools to prosecute the individuals involved in economic crimes. However, the EEA has significantly enhanced the security of United States economic sector. In the present, however, experts opine that the policy needs to keep pace with the rapid technological advancements experienced in the commercial industry. In the respect, several amendments are likely to be proposed on the law in the future. Importantly, several issues are involved in investigating economic espionage and trade secrets to determine the direct and indirect impact on the organization. According to Jarrett (2009), these issues include the level of economic injury of that the act on the owner of the information and the scope of the criminal activity. Although all trade sectors are vital to nation or organization, they have varying degrees of significance. For instance, trade sectors that still in the development stage are not as important as those which are already in operation. Besides, the information can impact on the firm directly or indirectly. Consequently, Jarrett (2009) points out the investigators first corporate with the aggrieved party to establish the potential damage that the stolen information is likely to cause. The establishment of the potential harm directs the urgency in which the case should be handled. Consequently, the process of determining the potential harm is not challenging since most organizations know the worth of each trade sectors they possess. In this respect, the higher the damage, the greater the urgency that investigations should be handled to avoid the trade secret being misused. Another vital issue involved in the investigation process is determining the scope of the criminal activity. As Jarrett (2009) expounds, the scope assessment involves evaluating if the criminal act involves international players. Consequently, the wider the scope of the espionage, the greater the economic loss an organization likely to incur. As a result of the substantial economic loss that emanates from the misappropriation of trade secrets, experts have developed several strategies for keeping trade secrets safe. According to Robertson, Hannah, and Lautsch (2016), measures such as non-disclosure agreements and limiting the physical and electronic access to confidential files have been outlined as the being highly effective. Importantly, experts advise that organizations need to update these measures regularly to maintain their effectiveness. The primary difference between misappropriation of trade secrets and economic espionage is the latter is characterized by the involvement of a foreign nation. Consequently, misappropriation of trade secrets is more damaging to a victim than economic espionage as result of its narrow scope. The revealing of a firm’s trade secrets has an immediate impact on its profitability. However, the diverse nature of nation’s economy insulates it from the adverse implications of economic espionage. In case an organization falls victim to these criminal acts they can use legal remedies to sue the perpetrators an...