What is a Restraint of Trade?

A Restraint of trade in Queensland are clauses expressly written in a contract for the purpose of restricting a parties’ ability to trade.

These clauses are usually found in employment contracts to protect an employer’s business interests from an employee who may have access to the employer’s clients, confidential information or trade secrets.

Restraints of trade in Queensland are also common in business sale contracts for the purpose of restricting the seller from establishing a competitor business.

Unlike other states, Queensland does not have legislation addressing restraint of trade. This means that the parties contracted to a restrained of trade clause must rely on common law and importantly, the written contracts to properly carry out their contractual obligations.

The Competition and Consumer Act 2010 (Cth) may affect some clauses in a limited capacity.

Key Takeaway

It is important to properly draft and understand a restraint of trade clause.

Failure to do so may result in clauses having no affect in its operation causing ongoing issues for everyone involved.

AKS Law can help you in drafting, advising and negotiating on all of your restraint of trade needs. If you are seeking legal advice, AKS Law are happy to assist you.

The content of this article is intended to provide a general guide to the subject matter and must not be relied on as legal advice or otherwise. Specific advice should be sought about your circumstances.