Non-Compete Clause

A non-compete clause is a provision in the franchise agreement that restricts the franchisee from opening or operating a competing business within a certain geographic area for a defined period of time. This clause helps protect the franchisor’s brand and intellectual property by preventing franchisees from using the franchisor’s knowledge and trade secrets to start a competing business. While non-compete clauses are common in franchise agreements, the scope and enforceability of such clauses can vary by jurisdiction.