Non-compete Agreement in Brazil

A non-compete agreement is a legal contract that restricts one party from engaging in activities that could compete with the other party, typically for a specified period of time after the end of a relationship between them. This type of agreement can be entered into between an employer and an employee or independent contractor, as well as between two businesses. 

How We Can Help You:

1. Review and draft the agreement
2. Negotiate terms with parties involved
3. Provide legal advice and guidance
4. Represent the company in court if necessary
5. Update the agreement as needed.

Our services can help protect the company’s confidential information and valuable business assets while ensuring that the non-compete agreement is legally binding and enforceable in Brazil.

Why Do You Need One?

A non-compete agreement helps protect a company’s confidential information, trade secrets, customer relationships, and other valuable business assets. It ensures that an employee or independent contractor cannot use this information to the company’s disadvantage after the end of the employment or contract relationship. Non-compete agreements can also be used between two businesses to prevent competition. By having a non-compete agreement in place, a company can secure its confidential information and valuable business assets.

Use of a Non-compete in Brazil

For companies entering Brazil, a non-compete agreement can be a useful tool to protect their confidential information, trade secrets, customer relationships, and other valuable business assets from being used to their disadvantage. By having a non-compete agreement in place with employees, independent contractors, or other companies, a company entering Brazil can ensure that this valuable information is protected. The terms and enforceability of non-compete agreements in Brazil may vary depending on the jurisdiction and the specific circumstances of the case, but having such an agreement in place can provide peace of mind and help protect the company’s interests.

It is important to have the agreement reviewed by a lawyer familiar with Brazilian labor laws to ensure that it is legally binding and enforceable.

Main Clauses of a Non-compete Agreement in Brazil

A non-compete agreement in Brazil typically contains the following main clauses:

1. Definition of confidential information: The agreement defines what is considered confidential information and establishes the obligations of the parties with respect to protecting it.

2. Duration of the agreement: The agreement sets the time frame during which the restrictions on competition apply.

3. Geographic scope: The agreement defines the geographic areas in which the restrictions on competition apply.

4. Restricted activities: The agreement defines the specific activities that are restricted and the actions that the parties agree to refrain from doing.

5. Exclusions: The agreement specifies any exceptions to the restrictions on competition, such as the ability to work for a competitor in a different geographic area or in a different capacity.

6. Remedies: The agreement outlines the remedies that are available in case of a breach of the agreement, such as monetary damages or injunctive relief.

7. Governing law: The agreement specifies the laws that govern the agreement, including the choice of law and venue in case of a dispute.

8. Termination: The agreement sets out the conditions under which the agreement may be terminated, such as the expiration of the term or the occurrence of certain events.

9. Entire agreement clause: The agreement contains a clause indicating that the agreement constitutes the entire understanding between the parties and supersedes all prior negotiations, representations, and agreements.

10. Signature: The agreement is signed by the parties, indicating their agreement to be bound by the terms of the agreement.

These are the main clauses typically included in a non-compete agreement in Brazil, although the exact terms may vary depending on the specific circumstances of the case and the needs of the parties.

Which Governing Law Should be Chosen?

In general, if the company entering Brazil is based in another country, it may be advantageous to choose the law of the country of origin as the governing law. This is because the company may be more familiar with the laws and legal system of its home country and may have existing relationships with legal advisors in that country.

However, if the non-compete agreement will be enforced in Brazil, it is important to ensure that the terms of the agreement are compliant with Brazilian law and do not conflict with any provisions of Brazilian labor law.

In such cases, it may be advisable to choose Brazilian law as the governing law, or to include a choice-of-law clause that provides for the application of Brazilian law in case of any conflict with the laws of the company’s home country.

In any case, it is recommended to seek the advice of a lawyer with expertise in both Brazilian law and the law of the company’s home country to ensure that the terms of the non-compete agreement are legally binding and enforceable in Brazil.