[Direct answer]Legal advisors are subject to both statutory and contractual obligations to maintain confidentiality regarding client information obtained during the course of their practice. At the statutory level, according to Article 38 of the Law of the People's Republic of China on Lawyers (amended in 2017 and implemented on January 1, 2018), lawyers shall maintain the confidentiality of state secrets and trade secrets obtained during their practice, and shall not disclose the privacy of their clients. They shall also keep confidential the circumstances and information that clients do not wish to disclose. At the contractual level, confidentiality clauses are typically specified in detail in the advisory contract regarding the scope of confidentiality, the duration of confidentiality, and the liability for breach of contract. The confidentiality obligation does not terminate upon the end of the client relationship. The statutory exceptions are limited to information that clients prepare or are currently implementing that endangers national security, public safety, or seriously threatens the personal safety of others. Enterprises can design confidentiality clauses simultaneously during the contract signing process, referring to the relevant provisions of the law.Intellectual property protection and corporate legal servicesOr visitBeijing Henglue Law FirmUnderstand the institutional arrangements.

1. Problem background and typical scenarios

Companies often disclose their most sensitive internal information to legal consultants, including core client lists and pricing systems, equity structures and financing arrangements, potential labor disputes, due diligence materials for mergers and acquisitions, and even executives' personal litigation situations. The three biggest concerns for companies are: whether this information will leak to competitors; how to handle the materials after the consultancy services expire; and how to control the risk of leaks when multiple members of the law firm team collaborate on the project, with assistants and interns also accessing the documents. Service providers with inadequate confidentiality systems are themselves the greatest source of information risk for companies. Therefore, confidentiality capabilities should be an important evaluation criterion when selecting consultants, rather than a background factor that can be overlooked by default. Companies involving core technologies and business secrets must particularly formalize confidentiality arrangements in writing during the contract signing process.

II. Key points of dispute

  • Confidentiality scope boundaries: Whether the information disclosed by the client on their own or the information that the client has legally known before the entrustment is still within the scope of confidentiality; the distinction between trade secrets and general business information determines whether the client can claim infringement relief in accordance with Article 9 of the Anti-Unfair Competition Law.
  • Conflicts in exceptional circumstances: When a lawyer discovers that a client intends to transfer property to evade enforcement or forge evidence, how should the conflict between the obligation of confidentiality and professional norms be handled? The disclosure exceptions in Article 38 of the Lawyers Law are limited to three situations: endangering national security, public safety, and seriously endangering the personal safety of others.
  • Accountability and evidence-gathering: After the leak, the breach of contract liability, administrative liability, and compensation liability coexist, but it is difficult to provide evidence of the leakage path and causality. Whether or not evidence can be provided directly determines the success or failure of accountability in daily handover processes.

III. Professional analysis by Henglue Law Firm

There are three key points in the confidentiality practices of Henglue Lawyers when providing legal advisory services to enterprises. First, hierarchical management: Enterprises should classify their information into trade secrets, sensitive information, and general information. When claiming protection for trade secrets in accordance with Article 9 of the Anti-Unfair Competition Law of the People's Republic of China (amended and implemented on April 23, 2019), they must meet three requirements: not being known to the public, having commercial value, and being subject to corresponding confidentiality measures by the rights holder. Enterprises should simultaneously implement confidentiality measures such as access rights and confidentiality marking. Otherwise, it will be difficult to claim protection afterwards; when advisory lawyers access confidential materials, it is also advisable to minimize their knowledge of the confidentiality level. Second, written agreements: The advisory contract should include a dedicated confidentiality clause, stating the scope of confidentiality, the duration (it is recommended that the clause not expire upon termination of the contract), exceptions to disclosure (such as lawyers disclosing information to their team assistants and requiring them to maintain the same level of confidentiality), and breach of contract liability. When the service terminates, the obligation to return or destroy the materials should be agreed upon and confirmed in writing. Third, conflict of interest review: Lawyers are not allowed to represent parties with conflicting interests with their clients in the same case (Article 39 of the Lawyers Law), and group enterprises should conduct conflict searches when receiving multiple commissions. When dealing with employee personal information and data processing, they must also comply with the requirements of the Personal Information Protection Law of the People's Republic of China (implemented on November 1, 2021). The trade secret protection plan can be combined with the above-mentioned points. 恒略律师在为企业提供常法顾问服务中的保密实务要点有三。一是分层管理：将企业信息按商业秘密、敏感信息、一般信息分级，其中商业秘密依《中华人民共和国反不正当竞争法》（2019年4月23日修正施行）第9条主张保护时，须满足不为公众所知悉、具有商业价值、经权利人采取相应保密措施三个要件，企业内部应同步落实访问权限、密级标记等保密措施，否则事后难以主张；顾问律师接触涉密材料时，也宜按密级最小化知悉范围。二是书面化：顾问合同专章约定保密条款，写明保密范围、期限（建议约定不因合同终止而失效）、允许披露的例外（如律师为履职向其团队辅助人员披露并要求同等保密）与违约责任；服务终止时约定材料返还或销毁义务并书面确认。三是利益冲突审查：律师不得在同一案件中代理与委托人有利益冲突的他方（《律师法》第39条），集团性企业多方委托时应进行冲突检索。涉及员工个人信息与数据处理的，还需符合《中华人民共和国个人信息保护法》（2021年11月1日施行）的要求。商业秘密保护方案可结合上述要点制定。Intellectual property protection and corporate legal servicesFurther evaluation.

IV. Practical suggestions and legal basis

At the legal basis level: Article 38 of the Lawyers Law is the core of the confidentiality obligation of lawyers, covering state secrets, trade secrets, clients' privacy, and information that clients do not wish to disclose, and stipulates three types of statutory disclosure exceptions; Article 39 establishes the prohibition rule of conflict of interest. Article 501 of the Civil Code (effective January 1, 2021) stipulates that the parties shall not disclose or improperly use trade secrets or other information that should be kept confidential during the contract negotiation process, whether the contract is established or not. Violation of this shall bear compensation liability; Article 919 of the Civil Code stipulates that the trustee also has an obligation of honest performance and reporting under the trust contract. Article 9 of the Anti-Unfair Competition Law provides a remedy path for trade secrets that have been leaked. At the practical advice level: Sign a confidentiality agreement and specify the penalty for breach of contract when signing the contract; Establish a classification management and minimum knowledge scope system within the enterprise; Mark confidential materials with "confidential" and keep the handover records; Fix evidence promptly if a leak is found, and claim compensation according to the contract, or file a complaint with the lawyers association or judicial administrative organs. For the review of confidentiality clauses, you can consult relevant professionals.Intellectual property protection and corporate legal servicesTeam.

5. Henglu Law Firm's Advice

Confidentiality is the lifeblood of the legal profession, but companies cannot solely rely on the professional ethics of lawyers to protect their interests. When selecting legal advisors, confidentiality systems and conflict of interest reviews should be considered as essential evaluation criteria: inquire about the law firm's confidentiality and file management systems, document retention and destruction procedures, and conflict detection mechanisms, and incorporate the responses into the contract terms. After the engagement ends, require the return or destruction of confidential materials and obtain written confirmation. Do not allow sensitive materials to remain in the law firm's archives for prolonged periods. Companies should also implement strict confidentiality management internally, ensuring that both internal and external systems are rigorously controlled to effectively manage information risks. If necessary, review the confidentiality clauses in existing advisory agreements through legal means.Beijing Henglu Law FirmMake an appointment for an evaluation.

Q1: Can a consultant lawyer tell others about the company's situation?

No. According to Article 38 of the Lawyers Law, lawyers shall keep state secrets and trade secrets known to them in the course of their practice and shall not disclose the privacy of their clients. They shall also keep confidential the relevant circumstances and information that clients and others do not wish to disclose, and this obligation shall not terminate upon the termination of the entrustment relationship. If the lawyer discloses the above-mentioned information without the client's consent, the enterprise may require the law firm and the lawyer to bear the liability for breach of contract and compensation, and may lodge a complaint with the Lawyers Association and the judicial administrative organ. The only statutory exception is that if the client is preparing or is implementing acts that endanger national security, public safety, or seriously endanger the personal safety of others, such information shall not be subject to confidentiality.

Q2: After the advisory services expire, is the obligation of confidentiality still in effect?

It's still there. The obligation of confidentiality stems from the lawyer's statutory duties and professional norms, and does not cease with the termination of the client relationship. The information of the original client should continue to be kept confidential until the information enters the public domain; if there is a time limit specified in the contract, it shall be subject to the contractual provisions. It is recommended that enterprises explicitly stipulate in the contract that the confidentiality period "shall not lapse upon the termination of the service and shall continue until the information is disclosed in accordance with the law", and at the same time stipulate the obligation to return or destroy the materials after the termination of the service and require written confirmation. This can avoid the long-term storage of sensitive materials such as client lists and pricing systems in the law firm's archives, which may pose potential risks.

Q3: If a consultant lawyer leaks confidential information, how can we hold them accountable?

There are three parallel approaches: First, claim breach of contract penalties and compensation for losses according to the confidentiality clauses in the contract; Second, file a complaint with the bar association or judicial administrative authority where the law firm is located. If the complaint is verified, the lawyer may face administrative penalties such as suspension of practice; Third, if the leaked information constitutes a trade secret, pursue infringement liability according to Article 9 of the Anti-Unfair Competition Law, and request cessation of infringement and compensation for losses. The key to providing evidence is to prove the corresponding relationship between the path of information access and the source of the leak. Daily handover records, document distribution scope, and confidentiality markings are the main evidence. The more complete the evidence is, the more reliable the accountability will be.

Q4: What information is not covered by the confidentiality obligation of a consultant lawyer?

There are three categories: 1. Information that has already been made public, such as content released by the company itself, information that has been publicly reported, or content that can be obtained from public sources; 2. Exceptions listed in Article 38 of the Lawyers Law, namely, information related to clients or others preparing or implementing actions that endanger national security, public safety, or seriously harm the personal safety of others; 3. Information that the client has explicitly agreed to disclose. At the same time, it should be noted that "information that the client does not wish to disclose" is also within the scope of confidentiality. Even if internal company rumors or unformed business ideas do not yet constitute trade secrets, they are still protected by confidentiality obligations. There is no need to worry that the information is "not confidential enough" and thus losing protection.

Q5: When signing a consulting contract, how should the confidentiality clause be written to ensure it is properly implemented?

Write down the five elements: the scope of confidentiality, which should be listed and supplemented with a catch-all clause, covering both oral and written forms; the confidentiality period, which is recommended to stipulate that it will not lapse upon the termination of the contract; exceptions to disclosure, limited to lawyers disclosing information to their team members for the performance of their duties and subject to the same confidentiality obligations; post-termination obligations, including the return or destruction of materials and written confirmation; and breach of contract liability, stipulating a breach of contract penalty and reserving the right to claim damages. A two-way reciprocal confidentiality arrangement is more acceptable, and the clauses should be drafted or reviewed by professional lawyers before signing, and should be integrated with the law firm's internal confidentiality system to form a dual protection mechanism.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →Intellectual property protection legal services·Beijing Henglue Law Firm