Academic literature on the topic 'Restraint of trade'

Clauses in restraint of trade agreements concluded between an employer and an employee often present difficult legal issues to deal with. This complexity is due to the fact that a court, in deciding whether to enforce a restraint provision, has to strike a balance between two equal but competing policy considerations, namely, the sanctity of the contract and the freedom of movement of people in a market economy. In striving to balance the sanctity of contract with the right of freedom to trade, it is necessary to decide which of these two policy considerations should take precedence by having regard to the public interest served by them in the particular circumstances. In the watershed case of Magna Alloys and Research(SA)(Pty) Ltd v Ellis, the Appellate Division decided the sanctity of contract had greater precedent in South African law and that undertakings in restraint of trade were prima facie valid and enforceable, unless the party seeking to avoid its obligations could show that the restraint of trade was contrary to public interest. The second consideration, namely that a person should be free to engage in useful economic activity and to contribute to the welfare of society, tempers the sanctity of contract considerations. Accordingly, the courts have struck down any unreasonable restriction on the freedom to trade where it was regarded as contrary to public interest. In considering the reasonableness and therefore the acceptability of restraint of trade provisions from a public policy perspective, the following five questions need consideration: Is there a legitimate interest of the employer that deserves protection at the termination of the employment agreement? If so, is that legitimate interest being prejudiced by the employee? If the legitimate interest is being prejudiced, does the interest of the employer weigh up, both qualitatively and quantitatively against the interest of the employee not to be economically inactive and unproductive? Is there another facet of public policy having nothing to do with the relationship between the parties but requires that the restraint should either be enforced or rejected? Is the ambit of the restraint of trade in respect of nature, area and duration justifiably necessary to protect the interests of the employer? In enforcing a restraint, the court will consider all the facts of the matter as at the time that the party is seeking to enforce the restraint. If a court finds that the right of the party to be economically active and productive surpasses the interest of the party attempting to enforce the restraint, the court will hold that such restraint is unreasonable and unenforceable. Consideration of the enforceability of restraints is often found to be challenging in view of the answers to the above stated five questions often remaining of a factual nature and subjective, i.e. the view and perceptions of the presiding officer play an important role. A further complexity is the limited early effect which the Constitution of the Republic of South Africa had on dispute resolution pertaining to restraints of trade in the employment context and the prospects of imminent changes to the pre-Constitutional era locus classicus of Magna Alloys and Research (SA)(Pty) Ltd v Ellis.

Thesis (LLM)--University of Stellenbosch, 2003.<br>ENGLISH ABSTRACT: This dissertation deals with restraints in post-employment cases in England, South Africa and Germany. The attempt was made to compare the restraint of trade doctrine that was developed in England and is still used in the common law countries, on one the hand, and the German restraint of trade rules on the other. Therefore the development of the restraint of trade doctrine in England is described, as well as the modifications of the restraint of trade doctrine in South Africa. Also it is given an overview of the German restraint of trade rules. As far as the English and South African law is concerned, the historical developments and applicable principles of the restraint of trade doctrine are emphasised, whereas the main aim in the German part is to give an overview about the codified restraint of trade rules. While comparing the common law doctrine and the German restraint of trade law it is emphasised that in the common law countries the reasonableness and public interest plays an important role, whereas in German restraint of trade law, on the other hand, the payment of compensation is an important matter.<br>AFRIKAANSE OPSOMMING: geen opsomming

Orientation: The topic of restraint of trade has attracted attention, with significant renewed interest in light of the role it is said to play in contributing to the executive‟s career moves and the protection it offers companies. At the heart of the issue is the perceived unfairness of the contract between the employee signing the contract and the company restraining the employee.Research purpose: The purpose of this study was to describe aspects the restraint of trade within the South African financial services industry.Motivation for the study: The motivation for the study was the development of a deeper understanding of restraint of trade, within the South African context, as the concept became prevalent over the past years with many questions remaining unanswered.Research design approach and method: The research was a qualitative, content study.Main findings/results: The primary finding was that, despite the wide use of such contracts they are not clearly understood, they are still perceived as unfair and are seen as a tool to curb career development.Practical managerial implications: The results suggest that the use of such contracts maybe popular but they are flawed, even though elements such as the period of the contracts and the quantum of payments are known the legal clarity and misunderstanding of these contracts is still an issue.Contribution/value add: The study provides context to Restraint-Of-Trade within a South African framework. It further provides key insight into the perception, misalignment of these contracts to the overall understanding and the aim they are meant to achieve.<br>Dissertation (MBA)--University of Pretoria, 2012.<br>Gordon Institute of Business Science (GIBS)<br>unrestricted

This thesis examines the theoretical properties of different price cap schemes that have been applied in the UK and the USA. The objective is to assess the consequences for price structures and welfare of different ways of defining the regulated price index. Chapter 2 surveys the literature on regulation under asymmetric information that is related to price caps. Chapter 3 presents a general analysis of five main types of price cap when the regulated firm sets linear tariffs. The schemes are the Tariff Basket (TB) scheme, the Fixed Weights (F) scheme, the Average Revenue (AR) scheme, the Average Revenue (Lagged) scheme, and the Paasche Price Index (PPI) scheme. The TB and PPI schemes generate efficient price structures in the long run, whereas prices are inefficient under the other schemes. In Chapter 4 the consequences of allowing freedom to set different prices, relative to the case of uniform prices, are analyzed. The conditions for price freedom to be desirable are derived for the case where the price level is not regulated. When the price level is regulated it is shown that AR regulation can cause welfare to be below the level that obtains without any regulation. Chapter 5 contains an analysis of the five price caps examined in Chapter 3 for the case where the firm sets a two-part tariff. The AR and PPI schemes are dominated, and the conditions under which TB, F and ARL are optimal are established. Chapter 6 explores some issues in the regulation of nonlinear tariffs by AR and TB price caps. Chapter 7 considers some extensions of the analysis. It is shown that when quality is a choice variable, the regulator is concerned about income distribution and there is demand growth the TB scheme can be adapted and retains its desirable properties. Chapter 8 contains conclusions and suggestions for future work.

The restraint of trade doctrine as understood here developed in English law but it was transplanted to England and Scotland. The two mixed legal systems closely followed English law. In Scotland a separate jurisprudence has only recently developed in this area. In South Africa attempts have been made to distinguish the English doctrine. But it has remained fundamentally in tact. That does not mean that the three systems are merely carbon copies of one another. Yet differences are subtle. An attempt is made to analyse the doctrine from broad principles although it is difficult. The doctrine has always worked in practice but it produces nice theoretical problems. It is here submitted that the public policy value of freedom of work should be the most important tenet couching the doctrine. Only clauses that offend against this fundamental principle should be investigated in terms of the doctrine. Only when the courts find that the interference with freedom of work can not be justified should clauses be struck down. Answers to the question when will a clause be unacceptable for being in restraint of trade are developed against the backdrop of freedom of work. Only the classical restraints i.e. post-employment, sale of goodwill and post-partnership restraints are discussed. These cases stand quite separate from most other restraints because they operate after termination of a work or production relationship and because they have generated a vast corpus of cases. The reasonableness inter partes test and the direct impact of public interest is analysed. Most importantly, it is argued that the public policy restraint of trade doctrine operates on two levels. The question whether the restraint is no wider than the legitimate interests of the covenantee makes or breaks a case. But many other aspects are also considered in filling the vacuums left by the severe difficulties of applying facts to law in this area of public policy.