NON-COMPETE inside a small country, inside a small profitable market
<p>I have received a Consulting Agreement in the middle of a project.</p>

<p>I live in Cambodia.</p>

<p><strong>The NON-COMPETE clause in question</strong></p>

<p>During the Term of this Agreement and 05 (five) year thereafter, the Consultant shall not engage, directly or indirectly, in any capacity, to be in any competition in the Client or any of its subsidiaries, including any company engaged in the business which is in competition with the Company's business.</p>

<hr>

<p><strong>Clarifications from comments</strong> </p>

<p><strong>@Greendrake</strong>
<em>Need clarity as to which party is Client and which one is Company. Are they the same thing? Which one do you work for?</em></p>

<p>Company refers to the CEO and his company. I have read the whole contract and "Client" only appears once in that NON-COMPETE.</p>

<hr>

<p><strong>My Questions</strong></p>

<ul>
<li><p>The market is small for the services I provide. Only banks are willing to pay for the services. Would this clause prohibit me for offering this service to anyone outside the current company I'm working with?</p></li>
<li><p>The CEO, with his lawyer have tried to convince me that this only apply to current client and any past clients that I have work on. Is this true?</p></li>
<li><p>If I start my own company, this would also apply to me right? Even if I start a company that provide online courses and don't offer services, this will still apply?</p></li>
<li><p>Would this make it impossible for me to take any job from any company in the country that provide this service?</p></li>
<li><p>From your view, how fair is this? Should I expect the CEO to offer a fair contract or is this something you read and negotiate? (This service has nothing todo with legal matters and I'm not expected to be good in legal matters)</p></li>
</ul>

<hr>

<p><strong>Country size:</strong> around 15 million people</p>

<p><strong>market:</strong> Only the capital, with less than 50 clients.</p>

<blockquote>
  <p>The CEO, with his lawyer have tried to convince me that this only apply to current client and any past clients that I have work on. Is this true?</p>
</blockquote>

<p>No. It will be true only if they make that clarification in the clause or a properly added amendment. The clause currently has no indication that it is limited to "<em>current client and any past clients that [you] have work[ed] on</em>".</p>

<p>The CEO's &amp; lawyer's refusal to amend the clause so as to make it consistent with their attempts [to persuade you] would be a red flag. Their inconsistent representations to you suggest that they are not planning to honor the <em>covenant of good faith</em> on which all contracts are premised.</p>

<blockquote>
  <p>Should I expect the CEO to offer a fair contract or is this something you read and negotiate?</p>
</blockquote>

<p>You should <em>require</em> a contract that seems fair <em>to you</em>. And by "<em>to you</em>" I mean that it has to be in line with <em>your</em> expectations regardless of the <em>average</em> conditions in the labor market.</p>

<p>Negotiations are not binding. They are merely a preamble to a contract, and that contract <em>is</em> binding. This is why you should reject a contract that falls short of your requirements.</p>

<p>Some clauses are unlawful and/or void and unenforceable as unconscionable or for contravening legislation (unlawful clauses can and do arise even if drafted by attorneys). Thus, although you might not have to worry about those clauses in particular, the company's mere attempt to include them in a contract should alert you of the high risk of ending up with other <em>abusive</em> terms &amp; conditions which are <em>binding and enforceable</em> nonetheless.</p>

<p><em>Provided that</em> the agreement is enforceable in your jurisdiction (which it well may not be as per the comments underneath):</p>

<blockquote>
  <p>Would this clause prohibit me for offering this service to anyone outside the current company I'm working with?</p>
</blockquote>

<p>Yes.</p>

<blockquote>
  <p>The CEO, with his lawyer have tried to convince me that this only apply to current client and any past clients that I have work on. Is this true?</p>
</blockquote>

<p>No.</p>

<blockquote>
  <p>If I start my own company, this would also apply to me right? Even if I start a company that provide online courses and don't offer services, this will still apply?</p>
</blockquote>

<p>Depends on whether you compete or not (and this depends on the details of what the Company does and you would do).</p>

<blockquote>
  <p>Would this make it impossible for me to take any job from any company in the country that provide this service?</p>
</blockquote>

<p>Yes. That would indirectly engage you to be in competition.</p>

<blockquote>
  <p>From your view, how fair is this? Should I expect the CEO to offer a fair contract or is this something you read and negotiate?</p>
</blockquote>

<p>Fairness and legality are apples and oranges. The CEO wants too much and tries to trick you into signing it. Stand your ground and offer your own draft.</p>

non-compete