Merger Non-Compete Clauses — Be Lawful or Be Gone
A recent FTC enforcement action clarifies the requirements for non-compete clauses in M&A agreements to fulfill certain requirements to comply with antitrust and competition laws, and serves as a reminder that U.S. antitrust authorities are actively reviewing these provisions, according to Orrick’s Antitrust Watch blog.
In the case, the Federal Trade Commission took issue with the non-compete clause in a purchase and sale agreement, which would have prohibited one seller from competing with the natural gas pipeline for three years.