Restraint Of Trade Malaysia
Agreement in restraint of trade void exception 1 saving of agreement not to carry on business of which goodwill is sold.
Restraint of trade malaysia. Agreements which have the object or effect of significantly preventing restricting or distorting competition in malaysia. Thus in malaysia the legislature had purposely made the list of exceptions in restraint of trade simply exhaustive by including the three common law exceptions. A specific prohibition on restraint of trade is also contained in the malaysian contracts act 1950.
Overview of competition laws. Exception 2 of agreement between partners prior to dissolution. The high court was prepared to make a substantive determination of the enforceability of the clause without waiting for trial.
The focus of this article is on restraint of trade clauses in employment contracts. 6 0 different perspective on restraint of trade among each country6 1 malaysia wrigglesworth vs wilson anthonyan agreement was entered into between the plaintif and the defendant whereby the latterwas restrainted from practising as an advocate and solicitor within 5 miles from kotabharu town for a period of 2 years after the termination of his service agreement with hisemployer. Every agreement by which anyone is restrained from exercising a lawful profession trade or business of any kind is to that extent void.
The law in singapore concerning restraint of trade is governed by case law rather than legislation. The competition act prohibits the following. While they are not technically illegal in malaysia non competition clauses have no legal effect because of section 28 of our contracts act 1950.
Contract whether the restraint of trade clause in partnership agreement contravened s 28 contracts act 1950 the ca 1950 02 june 2016 by jayadeep hari jamil. 28 of ca 1950. Malaysia myanmar the philippines thailand and vietnam.
Agreement in restraint of marriage void 28. Restraint of trade clauses are commonly found in different kinds of contracts for example employment contracts and sale of business contracts. Agreements in restraint of legal proceedings void.
Exception 3 or during continuance of partnership 29. For example in nordenfelt v maxim nordenfelt guns and ammunition co 2 a swedish arms inventor promised on sale of his business to an american gun maker that he would not make guns or ammunition anywhere in the world and would not compete with maxim in any way. It is regards to an employee who agrees not to compete with his employer by conducting a similar business or joining a rival.
In malaysia all contracts of restraint of trade are void unless it falls within exception provided in s. Restraint of trade in malaysia in malaysia there are four types of contracts where the provisions of restraint of trade may exist.
