Anti Competitive Agreements: A Resolution To Lessen The Competition


The rise of anti-competitive agreements came into the picture when the modernization of society happened. In today’s era, the role of anti-competitive contracts has been raised in such a manner that it has caused both positive and negative impacts upon society as this concept was new and less jurisprudence or law has been developed upon its interpretation. Therefore, with the help of this article, we want to inform the readers about the positive, and negative impact of anti-competitive agreements with drafting techniques.

What is the meaning of Anti Competitive Agreements?  

The meaning of the anti-competitive agreement is not mentioned anywhere, but the term states its meaning which adheres to restricting someone from entering the business of the same competition. Generally, this clause is used in agreements formulated between Employer and Employee. Moreover, the primary purpose of Anti-Competitive Agreements or Non-Solicitation Agreements is to protect the confidentiality of any business or organization.

What are the benefits of Anti Competitive Agreements?  

The presence of an Anti Competitive clause or agreement provides various benefits to the business owner to maintain the confidentiality of any business or organization. This clause or agreement restrains the other party from conducting or working with the same company for a specific period. This benefits the business owner because his confidentiality is protected even after the contract has been terminated.

Whether Anti Competitive Agreements are permissible in the eyes of the law? 

The execution or existence of Anti Competitive Agreements is permissible in the eyes of the law but to a limited extent as the law and courts in UAE are clear on this subject and does not permit the execution of Anti-Competitive clause in total which means the Anti-Competitive agreements or clause shall specify a particular region or territory wherein the applicability shall be determined for a particular time which shall not exceed more than two years. If the said anti-competitive clause is dealt with such ingredients, then only it is valid. It will also be considered null and void in the eyes of law.

What are the key provisions in the drafting of Anti-Competitive Agreements? 

The anti-competitive agreement shall include the below mentioned key provisions; otherwise the agreement will not be considered valid. Our Commercial Contract Lawyer will state about some of the key requirements which are to be included in these agreements the said provisions are mentioned hereinbelow:

  • Details of the Parties 

This clause shall include the details of the contracting parties with relevant information regarding email and Emirate ID or passport.

  • Purpose clause 

This clause will include the purpose for the execution of the contract which will define the understanding between contracting parties.

  • Non-Compete Clause

This clause will define the nature of competition in which the other contracting party shall not enter or engage with either directly or indirectly. Moreover, it is pertinent to mention here that in this clause, specific territorial jurisdiction, time which shall not be exceed 2 years, and nature of business must be specified then, only this clause will become valid.

  • Non-Solicitation Clause

This clause will obligate the other contracting party to the purpose of non-soliciting any of the employee or other staff members after the termination of the contract with him.

  • Penalty or Compensation Clause 

This clause will include the penalty or compensation in case of breach of default is made by the other party. The amount of compensation or liability shall be specified in the contract so that in case a default has been committed by the other party. Then they can compensate in the form of compensation or penalty.

  • Jurisdiction Clause 

This clause will define the jurisdiction of the contracting parties in case if the dispute arises between them so the said party can recourse their remedy under the law as per governing law.

Our Commercial Contract Lawyer has only specified the essential provisions to be included in the agreement or clause about Anti-Competitive. Therefore, it is crucial to understand that Anti-Competitive contracts will only be valid when the essential elements specified above are met.

How can we help you? 

Nour Attorneys Law Firm has a specialized team of highly qualified Commercial Contract Lawyers with extensive experience drafting contracts and agreements specially non-compete agreements. To know more about our services in details click here to access our service page in relation to Non-Compete Agreements.

Our Legal Documents Drafting Service covers a variety of subjects and agreements. Moreover, our law firm team of lawyers and legal consultants is capable enough to defend and protect our client’s interest at the prior stage of the dispute with the help of tremendous drafting skills. Therefore, to avail the benefits of services that our lawyers are providing always feel free to contact us.

Note: This Article is only for informative purposes, and views expressed herein do not reflect the opinions and beliefs of the website or its affiliates, and the reader cannot hold the website or its affiliates liable for the contents of this Article.