Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Seventeenth Congress
First Regular Session

HOUSE OF REPRESENTATIVES
H.B.No._ 5942

Introduced by Representative H. Harry L. Roque Jr.

EXPLANATORY NOTE
‘The development of proprietary economic information is an integral pant of a nation's
commerce. Its development, protection and lawful exchange are essential to the
‘competitiveness of critical segments of Philippine business and industry.

The theft, misappropriation and wrongful use of Philippine proprietary economic
information by foreign governments and their agents or instrumentalities can cost our
economy millions of pesos each year. Existing laws do not give adequate protection to
Proprietary economic information.

This bill seeks to prevent economic espionage. It also secks to advance the

development and lawful use of Philippine proprietary economic information by protecting


such information from theft, wrongful destruction or alteration, misappropriation and
conversion by foreign governments and their agents or instrumentalities.”

sda

H. HARRY L. ROQUE JR.

* This bill was originally filed by Senator Miriam Defensor Santiago during the Sixteenth Congress, First
Regular Session


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Republic of the Philippines
HOUSE OF REPRESENTATIVES

Quezon City

Seventeenth Congress
First Regular Session

HOUSE OF REPI ‘ATIVES
H.B. No.

Introduced by Representative H. Harry L. Roque Jr.

AN ACT
DEFINING THE CRIME OF ECONOMIC ESPIONAGE AND PROVIDING PENALTIES
THEREFOR

Be it enacted by the Senate and the House of Representatives of the Philippines in
Congress assembled:

SECTION |. Short Title. - This Act may be cited as the “Economic Espionage and
Protection of Proprietary Information Act”

SECTION 2. Statement of Policy. - It is hereby declared the policy of the State to
Prevent economic espionage and further the development and lawful use of Philippine

proprietary economic information.

SECTION 3. Definition of Terms. -As used in this Act, the term:
(A) “Foreign corporation, institution, or instrumentality” means any corporation,
agency, component, institution, association, instrumentality, or legal, commercial, or business


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entity that is substantially owned, controlled, sponsored, commanded, managed, patronized,
dominated, or chartered by a foreign government or subdivision of a foreign government,

(B) “Foreign agent” means any officer, employee, proxy, servant, delegate, or
representative of a foreign nation or government;

(C) “Person” means a natural person, corporation, agency, association, institution,
‘or any other legal, commercial, or business entity;

(D) “Proprietary economic information” means all forms and types of financial,
business, scientific, technical, economic, or engineering information including, but not
limited to data, plans, tools, mechanisms, compounds, formulas, designs, prototype,
Processes, procedures, programs, codes or commercial strategies, whether tangible or
intangible and whether stored, compiled, or memorialized physically, electronically,
graphically, photographically, or in writing provided that the following concur:

(1) The owner thereof has taken reasonable measure to keep such
information confidential;

(2) The information is not available generally to, or accessible by, the
public; and

(3) The information is not a matter of public concern.

(E) “Owner” means my Filipino person or any Philippine Government compound,
department, or agency in which, rightful legal, beneficial, or equitable title to, or license in,
proprietary economic information is reposes;

(F) “Filipino person” means -

(1) In the case of a natural person, a Philippine citizen or a permanent

resident alien, and


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(G)

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In the case of artificial person, a Philippine Government or by Filipino
citizens or permanent resident aliens, or incorporated under Philippine

laws.

“Beonomic Espionage” is committed by any person who:

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(4)

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Steals, wrongfully appropriates, takes, carries away, or conceals, or by
fraud, artifice, or deception obtains proprietary economic information;
Wrongfully copies, duplicates, sketches, draws, photographs,
downloads, uploads, alters, destroys, photocopies, replicates, transmits,
delivers, sends, mails, communicates, or conveys proprietary economic
information;

Being entrusted with, or having lawful possession or control of, or
access to, proprictary economic information, wrongfully copies,
duplicates, sketches, draws, photographs, downloads, uploads, alters,
destroys, photocopies, replicates, transmits, delivers, sends, mails,
communicates, or conveys the same;

Receives, buys, or possesses proprietary economic information,
knowing the same to have been stolen or wrongfully appropriated,
obtained, or converted,

(5) Attempts to commit any offense described in the preceding
subparagraphs (1), (2-1, (3) or (4);

Wrongfully solicits another to commit any offense described in
Preceding subparagraphs (1), (2), (3) or (4), or

Conspires with one or more other persons to commit any offense
described in preceding paragraphs (1), (2), (3) or (4), and one or more

of such persons do any act to effect the object of the conspiracy, shall,
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except as provided in the next subsection (B), be fined not more than
50% of the economic value of such proprietary information or

imprisoned for a period ranging from 15 or 25 years, or both

SECTION 4. Prohibited Acts; Penalties. - Any natural or juridical person who
commits economic espionage as defined in the preceding Section, whether or not in the aid of
foreign nations, governments, corporations, institutions, or instrumentalities, shall be fined an
amount equivalent to the economic value of such proprietary information The person
mentioned in the preceding paragraph is presumed to have acted with intent to injure any
owner and benefit any foreign nation, government, corporation, institution, instrumentality,
unless proven otherwise. If the offender is a corporation, any officer, director, or manager, or
other person occupying a position of authority and responsibility for the acquisition, use or
management of proprietary economic information for any corporation or other business or
‘commercial entity who knowingly permitted or failed to prevent the commission of any of the
acts which constitute economic espionage.

SECTION S. Forfeiture. - Notwithstanding any provision of law to the contrary, any
person convicted of violation of this Act shall forfeit to the Philippine Government any
property constituting, or derived from any proceeds the person obtained, directly or
indirectly, from the commission of such violations; and any of the person’s properly used, or
intended to be used, in any manner or part, to commit, or to facilitate the commission of a
violation of this Act. The court, in imposing penalty on the offender for a violation of this
Act, shall order that the property described in paragraph (A) of this Section be forfeited in

favor of the Philippine Government.


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SECTION 6. Extra-Territoriality. - Notwithstanding any provision of law to the
contrary, this Act applies to conduct occurring outside the territorial jurisdiction of the
Philippines if -

(A) The offender is a Filipino citizen or permanent resident of the Philippines;

(B) The victim of the offense is an “owner”, as defined in Section 3 of this Act,
and the offense was intended to have, or had, an effect in the Philippines; or

(C) The offender foreign corporation is conducting business in the Philippines
through agents or subsidiaries and has caused damage to the “owner” in the conduct of its
business abroad

SECTION 7. Construction with Other Laws. - This Act shall not be construed to
preempt or displace any other existing legal remedies, whether civil or criminal, for the
misappropriation or proprietary economic information.

SECTION 8. Preservation of Confidentiality. - in any prosecution under this Act, the
court shall preserve the confidentiality of alleged proprietary economic information by any
reasonable and lawful means including, but not limited to -

{A) The granting or protective orders in connection with discovery proceedings;

(B) The holding of in-camera hearing, sealing relevant portions OC the record,
and the ordering of any person involved in the proceedings not to disclose the alleged
proprietary economic information which is the subject of the offense may request the
prosecution to seck such protective action.


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SECTION 9. Non-Applicability of Lawfully Authorized Law Enforcement or
Intelligence Activities. - Any act in which information is seized, taken, transported,
transmitted, or transferred pursuant to or in furtherance of any lawfully authorized
investigative, protective, or intelligence activity of a law enforcement agency of the
Philippines or any of its political subdivisions, shall not be deemed a violation of this Act.

SECTION 10. Separability Clause. - If any provision or part thereof is held invalid or
unconstitutional, the remainder of the law or the provision not otherwise affected shall remain
valid and subsisting.

SECTION 11. Repealing Clause. - Presidential Decree No. 1602 is hereby amended.
Any law, presidential decree or issuance, executive order, letter of instruction, administrative
order, rule, or regulation contrary to or inconsistent with the provisions of this Act is hereby
repealed, modified, or amended accordingly.

SECTION 12. Effectivity Clause. - This Act shall tale effect fifteen (15) days after its
publication in at least two (2) newspapers of general circulation.

Approved,