TOKYO — Japan and the U.S. will agree not to require technology companies to divulge software secrets under their bilateral trade deal, except in cases of possible antitrust law violations, Nikkei learned Thursday.
The in-principle ban on forced disclosures, part of the section of the draft agreement pertaining to digital trade, shows an attempt to strike a balance between high-tech competition and government’s role in intervening to prevent data from becoming concentrated in the hands of a few companies.
Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump are poised to sign the trade agreement on the sidelines of the United Nations General Assembly meeting in New York later this month.
Details on farm and factory good tariffs are still being hammered out following a basic agreement reached by the two leaders on Aug. 25.
The rules on data, a key determiner of competitiveness for tech companies, are among the most closely watched parts of the trade deal’s digital provisions.
Japan’s competition regulator recently published new enforcement guidelines meant to prevent abuses of consumer data by platform companies — a category that includes U.S. tech giants Google, Amazon.com and Facebook.
The risk of government seizures of software source codes, proprietary algorithms and other tech secrets poses a barrier to business expansion. Japan and the U.S. have pushed for international rules on this front at the World Trade Organization and other forums, harboring particular concerns over China.
But Tokyo and Washington will leave room in their trade deal for exceptions to the ban on forced disclosures, according to the draft document. Companies could be required to hand over data in cases in which consumer safety is at risk or in possible violation of competition or privacy laws.
BY TAKASHI TSUJI, Nikkei staff writer