It is common practice for company managers to be required, either with the contract for management and representation, or with later declarations or agreements, to undertake the obligation not to exercise competitive activity after they no longer occupy their position. Similar obligations and prohibitions may also be directed at the company partners or at the members of the board of directors or the management board. It is usual for a penalty to be provided for non-compliance with the ban on competition exercised by a former partner.

The commercial law prohibition of competitive activity of partners (Article 83 of the Commerce Act), managers (Article 142 of the Commerce Act), and members of the board of directors or the management board (Article 237, para. 4 of the Commerce Act) is usually in force only while the persons occupy the position. Still, case law accepts that if they of their own accord bind themselves before the company “for a defined and acceptable in terms of length period” following the termination of their legal relationship with the company, then a possible violation would give rise to an obligation to pay the penalty. For example, a period of one year has been deemed acceptable by the Supreme Court of Cassation.

From the point of view of competition law, however, the Commission for Protection of Competition has repeatedly noted that the prohibition of unfair competition of employees, which existed under the 1991 Competition Protection Act (repealed), is in conflict with constitutional provisions, and therefore such a prohibition is not included in the present legal act. The text, which is no longer in force, forbade persons in management or control bodies, as well as persons in an employment relationship, to carry out competitive economic activity for three years after leaving the company.

You can read the whole article, as well as much more at the website of Dobrev & Lyutskanov Law Firm - https://www.legaldl.com/en/competition-exercised-by-a-former-partner/