economic espionage

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Economic espionage is the unlawful or clandestine targeting or acquisition of sensitive financial, trade or economic policy information; proprietary economic information; or technological information.

The primary law against economic espionage is the Economic Espionage Act of 1996 (EEA), 18 U.S.C. §§ 1831-1839. The Act defines the term "economic espionage" as the theft or misappropriation of trade secrets and other intellectual property with the intent or knowledge that the offense will benefit “any foreign government, foreign instrumentality, or foreign agent.”  See 18 U.S.C. § 1831

The Act arose after a string of employees from U.S. companies began sharing technology with foreign governments that threatened national security. These threats can also come in the form of harming the economic stability of the United States. The sharing of innovative technology can be detrimental to individual companies, but also to overall economic growth. 

In reaction, the EEA enacted high fines against individuals and companies who knowingly give unauthorized information to foreign governments. The punishment for individuals can be up to 15 years in prison along with up to $5 million in fines, and the fines for companies can be up to three times the value of the misappropriated information. However, according to the case United States v. Chung, 633 F. Supp. 2d 1134, 1146 (C.D. Cal. 2009), the Act requires that the prosecution prove that the person knew the information to be a trade secret and that they intended to benefit a foreign government. This distinction is important as often individuals may forget or not realize information obtained is protected information, or an individual may not realize they are sharing protected information with a company that benefits a foreign government. 

Individuals who do not intend to benefit a foreign government but still intend to misappropriate trade secrets can be punished under § 1832 of the EEA. This part of the EEA punishes both foreign and interstate misappropriation of trade secrets. Sometimes, this is referred to as corporate espionage, in contrast with economic espionage, as the intent solely is for commercial gain. 

[Last updated in November of 2022 by the Wex Definitions Team]