In the case at issue, the employer has operated an online marketing agency since 2011 that specializes in Lead Generation. The company grew from 25 employees to 80 employees in 2015 and is active in The Netherlands, Belgium, France, Germany, Italy, the United Kingdom, Poland and Australia. The employee entered into the service of the employer on 1 April 2014 as the sixth member of the team. The parties agreed upon a worldwide non-competition clause in the employment agreement. The employee terminated his employment per 1 June 2016, as he wished to establish his own online marketing agency specialized in Lead Generation in Asia. The employee petitioned the court to mitigate the non-competition clause, which would have allowed him to start his own business in Asia.
The Subdistrict Court rejected the employee’s claim and took into consideration that the employer wished to eventually develop further activities in Asia. Furthermore, the employee was fully aware of all ins and outs of the business, in particular Lead Generation. The court found that these circumstances justified the employer’s concerns that should the employee enter into the Asian market, the chance of competition would be high, not only in The Netherlands, but also worldwide. The employee lodged an appeal against this decision.
The Court of Appeal ruled that a worldwide non-competition clause is, in principle, permissible. However, as the employer had not yet performed any activities in Asia as of the date of the employee’s termination, the court ruled that the employer had no interest in maintaining the non-competition clause in Asia when compared to the employee’s right to freely choose his employment. Nonetheless, the employee will remain bound by the non-competition clause insofar as he operates from Asia in the countries where the employer is active.