Know-how, according to the definition developed in the EU, "information confidential, substantial and identified in an appropriate form":

  • confidential - which means that the object of the contract is not widely available and known,
  • significant - which means that the information is valid and original,
  • identified - which means that the know-how is described and fixed in such a way that it was possible to verify that it fulfills the criteria of secrecy and substantiality should therefore have a material form.

Know-how owner has the right to property, which may be the subject of business transactions and (in special cases) subject to contribution.



Valuation of know-how is usually performed in the income approach and the market or cost approach less. There may be a situation in which the value of know-how will suffer prejudice as a result of injurious actions (eg, disclosure of confidential information). In this case, the process of claiming compensation, aiming to compensate for the damage and loss of profit, independent valuation will be needed.



Disclosure of confidential information can cause irreversible effects, nullify the effects of long-term investment process and the basis of a strategic market advantage. An important issue is the protection of know-how, especially in a situation where as a result of a number of statutory or contractual entitlements, organizations have access to third parties, egzample: contractors, inspectors and auditors. There are known cases of transmission of knowledge between competing companies through unfair people outside the company, to which competition has easy access.