Regulating Source Code in Trade Agreements: Between Protection and Disclosure

Abstract Provisions prohibiting the mandatory disclosure of source code and algorithms as a condition for market access in digital trade rulemaking aim to prevent forced technology transfer and safeguard confidential business information. However, their proliferation raises significant concerns regarding the state’s capacity to regulate digital technologies, including artificial intelligence. This Article argues that their rapid diffusion signals a regime shift in the international protection of software and algorithms, from intellectual property (IP) law to digital trade law. Under the TRIPS framework, trade secrets primarily protect undisclosed confidential information, such as source code and algorithms, and offer limited protection at the point of market entry. Source code provisions in digital trade function as an ex-ante layer of protection that operates independently of, yet cumulatively with, existing IP rights. Because digital trade law lacks the internal balancing mechanisms characteristic of the IP regime, regulatory space is mediated principally through the design of exceptions and carve-outs. By situating these provisions against this background, this Article reframes current debates from regulatory chill to the governance consequences of this regime shift and contends that the design of source code exceptions and carve-outs is now the primary mechanism for balancing proprietary protection against legitimate public policy disclosure.