The Legal Status Of Non-Compete Agreements In Contract Law: A Comparative Study

Anirudh Mittal, B.Sc. LL.B (Hons.), School of Law Forensic Justice and Policy Studies, National Forensic Sciences University

ABSTRACT

This paper discusses the legality and implications of non-compete clauses, specifically focusing on their enforceability under Section 27 of the Indian Contract Act 1872. A comparative study in sectors and jurisdictions was conducted on their role in mergers and acquisitions (M&A) and employment agreements. This paper sheds light on the fact that the clarity of non-compete agreements is on the interpretation of the courts. A clear definition of non- compete clauses is not provided by the UK or Northern Ireland but is operated through precedents. In contrast, the US generally enforces non- compete agreements, although enforcement may vary by state. In Singapore, non-compete clauses will be enforced if the scope, duration, and geographic restrictions of the non-compete clause are reasonable.

Keywords: Non-Compete, Contract law, Employment, M&A, Comparative study.