Exploring the Use of Trade Secrets Among the Micro, Small and Medium Enterprises Within the Manufacturing Sector in Uganda

Abstract

The study aimed at exploring the use of trade secrets and confidential business information among micro, small and medium enterprises within the manufacturing sector in Uganda. The study was limited to Kampala district and attracted eleven (11) key informants that were purposively selected from different professional background and forty two (42) randomly selected enterprises from food& beverage, pharmaceutical, cosmetics& toiletry, textile and engineering works. The study looked into establishing the level of awareness of intellectual property rights among entrepreneurs, identifying the reasons underlying the utilization of trade secrets as opposed to other intellectual property rights, investigate the challenges of maintaining trade secrets by MSMEs and reviewing current legal frame works and their suitability for appropriation of trade secrets and confidential business information. A triangulation methodological approach was used for the study. The study evidenced the existence of trade secrets and confidential business information in commerce within the manufacturing sector and utilized by not only MSMEs but also large enterprises. Both technical and business information define the scope of trade secrets in the sector. Employee mobility, customers and competitors pose a significant risk to theft and misappropriation of trade secrets and confidential business information. The Legal frameworks provide a reasonable mechanism for enforcement of protection for protection of trade secrets but the familiarity of those legislations is very low among the entrepreneurs.