Fiducia TogetherNon-compete on a business sale
The seller's promise not to set up in competition. Different rules from employment.
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.
What it means
On a business sale the seller usually gives covenants not to compete, solicit customers or poach staff for a period.
Why it matters
Courts enforce these far more readily than employment covenants, because the buyer has paid for goodwill and is entitled to protect it.
What it looks like in practice
Periods of two to five years are commonly upheld on a sale where equivalent employment restrictions would not be.\n\nThey must still be no wider than necessary in scope and geography.
What to watch out for
A seller who wants to keep working in the sector. Negotiate the carve-outs before signing, not afterwards.
Where to get proper advice
A corporate solicitor on both sides.
Where to read more
Last reviewed 2026-08-28 by Fiducia Together · Next review due 2027-08-28
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.