Contract Clause Library
Non-compete clause
Restricts one party from working with a competitor or in a competing capacity for a defined period and geography.
In agency contracts, this usually restricts the agency from taking on a directly competing client (or the client from poaching agency staff to build an in-house competing capability) for some window after the engagement ends. Enforceability varies significantly by jurisdiction — some U.S. states heavily restrict or ban non-competes outright — which makes the governing law clause directly relevant to how much weight this one actually carries.
Sample wording
Sample language (illustrative, not legal advice)
For 12 months following the termination of this Agreement, Vendor will not knowingly provide substantially similar services to a direct competitor of Client operating in the same specific market segment, without Client's prior written consent.
Red flags
- A restriction period or geographic scope broad enough to meaningfully limit the agency's ability to take on other clients
- "Competitor" defined so broadly it could include most plausible future clients in the same general industry
- A non-compete included in a jurisdiction where such clauses are unenforceable or heavily restricted, giving false confidence to whichever party expects it to hold
How MarginFlow reads it
MarginFlow surfaces this clause's restriction window and defined scope so it's checkable before pursuing a new client in an adjacent space — a one-time reference lookup rather than something the ongoing alert engine monitors.