Non-Competition and Non-Solicitation Clause

A non-competition clause is an agreement between an employer and an employee under which the employee is prohibited from working for a competitor of the employer for a specified period following the end of the employment contract. A non-competition clause serves to protect the employer’s interests, such as safeguarding business information and know-how. A variant of the non-competition clause is the non-solicitation clause. A non-solicitation clause prohibits the employee from working for the employer’s business contacts for a specified period following the end of the employment contract.

Article 7:653(1) of the Dutch Civil Code sets out the requirements that a non-competition clause must meet. The clause must be agreed in writing between the employer and an employee of legal age, and the employment contract must be for an indefinite period. A non-competition clause in a fixed-term employment contract is void (invalid), unless the employer sets out in the employment contract< 1 > that the clause is necessary on the grounds of compelling business and service interests.