The Superior Court of Justice (STJ) ruled that non-compete clauses without a temporal limitation constitute a case of voidability rather than absolute nullity, as they impose a disproportionate restriction on the exercise of economic activity.
The case originated from the dissolution of a business partnership in the children’s clothing sector, in which former partners agreed to a mutual non-compete clause with no time limit — one was barred from marketing children’s clothing above a certain size, and the other below that size. The dispute arose when one of the parties failed to comply with the clause.
Upon review, the 3rd Panel of the STJ held that, although there is a public interest in preserving free competition and economic initiative, such restriction falls within the private sphere. Since no rule of public order was violated, the clause is relative — that is, voidable rather than absolutely null.
The effects of this decision include:
- the possibility of curing the clause by the parties (by inserting an adjustment or temporal limitation required for its validity);
- the application of a statute of repose (decadential period) for the aggrieved party to request annulment, since the clause is voidable;
- the recommendation that non-compete clauses be drafted with clear boundaries concerning time, territory, subject matter of the restriction, and possible (remunerative) compensation for validity.
Foto: Canva
