Non-Compete Clauses in Belgium: Validity and Limits

The non-compete clause is one of the most widely used contractual mechanisms in Belgium for protecting a company's economic interests. However, Belgian law strictly regulates its validity, whether in an employment contract, a relationship between self-employed professionals, or a commercial partnership agreement. This article details the applicable rules, the conditions for validity, and the limits to observe.

The fundamental principle: freedom of trade

Under Belgian law, the basic principle is freedom of trade and industry (liberté du commerce et de l'industrie), enshrined in the Allarde Decree of 2-17 March 1791, still in force today. Any restriction on this freedom must be:

• Limited in time
• Limited in space (geographical territory)
• Limited as to the activities covered
• Proportionate to the legitimate interest being protected

A non-compete clause that fails to meet all four of these cumulative conditions risks being declared void by the courts.

Non-compete clauses for employees

Legal basis

The non-compete clause for employees is governed by Articles 65 and 86 of the Employment Contracts Act of 3 July 1978. The regime differs depending on whether the employee is a blue-collar worker (Article 65) or a white-collar employee (Article 86).

Cumulative conditions for validity

To be valid, a non-compete clause in an employment contract must meet all of the following conditions:

Calculating the compensatory allowance: a worked example

An employee earns EUR 4,000 gross/month. The non-compete clause provides for a 12-month restriction.

• Gross annual pay: 4,000 x 12 = EUR 48,000 (above the EUR 41,969 threshold: condition met)
• Minimum compensatory allowance: 50% x EUR 48,000 x (12/12) = EUR 24,000
• This allowance is payable by the employer in a single payment when the contract ends

Exclusions: when the clause does not apply

The non-compete clause does not take effect in the following cases (Article 65, §2 and Article 86, §2):

• Dismissal without serious cause by the employer during the first 6 months of the contract
• Resignation by the employee through no fault of the employer, if the employer waives the clause within 15 days of the contract ending
• Dismissal for serious cause: the clause remains applicable
• Termination by mutual agreement: depends on what the parties have agreed

The "special" non-compete clause for high earners

When gross annual pay exceeds EUR 83,939 (2026 amount, indexed), the parties can agree to a broader non-compete clause:

• The territory can extend beyond the company's sphere of activity
• The activities covered can be broader
• But the duration remains capped at 12 months
• The compensatory allowance remains at a minimum of 50%

For intermediate roles and pay levels (between EUR 41,969 and EUR 83,939), the standard clause applies, with strict territorial limits.

Sales representatives

Sales representatives (représentants de commerce) benefit from a specific regime set out in Articles 104 and 105 of the Act of 3 July 1978:

• The clause must be in writing
• Maximum duration of 12 months
• Territory limited to the regions where the representative operated
• Similar activities only
• No compulsory compensatory allowance (unlike other employees)
• But an eviction allowance may be due in the event of dismissal without serious cause

Non-compete clauses between self-employed professionals (B2B)

Legal framework

Between self-employed professionals (service agreements, consultancy contracts, subcontracting agreements), the non-compete clause is not governed by the Employment Contracts Act, but by general contract law (formerly the Civil Code, now Book 5 of the new Belgian Civil Code, in force since 1 January 2023).

Validity conditions in B2B

Belgian case law imposes the same four fundamental conditions:

1. Time limitation: the clause must have a fixed duration. Case law generally regards a duration of 1 to 3 years as acceptable, depending on the sector and the nature of the activity.

2. Geographical limitation: the territory must be proportionate. Examples:

   • Acceptable: Belgium, or Belgium plus neighbouring countries
   • Problematic: "the entire world" without specific justification

3. Limitation to the relevant activities: the clause cannot ban all professional activity, only directly competing activities.

4. Proportionality: the clause must be proportionate to the legitimate interest being protected (protecting know-how, the client base, or trade secrets).

Concrete example: a valid clause vs a void clause

Valid clause:

"The service provider undertakes not to carry out web development work for the direct clients of company X in Belgium, for a period of 12 months from the end of the contract."

Void clause (too broad):

"The service provider undertakes not to carry out any professional activity in the IT sector, anywhere in the world, for a period of 5 years from the end of the contract."

The compensatory allowance in B2B

Unlike employment law, there is no legal obligation to pay a compensatory allowance in B2B relationships. However:

• The absence of an allowance can be a factor the courts take into account when assessing the clause's proportionality
• It is advisable to include financial consideration to strengthen the clause's validity
• The amount is freely negotiated between the parties

Non-compete clauses in commercial partnership agreements

The specific regime under Book X of the Code of Economic Law

In franchising and commercial partnership agreements, Article X.31 of the Code of Economic Law (CDE) sets out mandatory rules:

The non-compete clause during the term of the contract

During the performance of the franchise agreement, a non-compete clause is generally considered valid if:

• It is necessary to protect the franchisor's know-how
• It is limited to activities competing with the network
• It is proportionate to the purpose of the franchise

Non-compete clauses when selling a business

Sale of a business (fonds de commerce)

When a business (fonds de commerce) or company shares are sold, a non-compete clause on the seller is common and generally more readily accepted by the courts:

• Duration: 3 to 5 years is generally accepted
• Territory: the catchment area of the business
• Activities: activities identical or similar to those of the business sold
• Compensation: built into the sale price of the business

Sale of company shares (SRL, SA)

When company shares are sold, the seller often commits not to compete with the company sold:

• The accepted duration can be longer (up to 5 years)
• The territory can cover the company's entire area of activity
• The consideration is built into the price of the shares

Consequences of a non-compete clause being void

Total nullity vs judicial reduction

Belgian law does not allow a court to scale down an excessive non-compete clause to make it valid. The principle is total nullity of the clause:

• If the duration is excessive: the entire clause is void
• If the territory is too broad: the entire clause is void
• If the activities are too broad: the entire clause is void

Important exception: some recent case law accepts the possibility of reduction in B2B relationships if the parties have expressly provided for it in the contract (a "severability" clause or "blue pencil clause").

Associated penalty clause

A penalty clause is often included to sanction a breach of the non-compete obligation:

• Under Belgian law, a court can reduce a manifestly excessive penalty clause (Article 5.88 of the new Civil Code)
• Common amounts: between EUR 10,000 and 50,000 per breach, sometimes with a daily penalty of EUR 500 to 2,000

Procedure in the event of a dispute

Competent courts

Summary proceedings

In urgent cases (where the competitor is actively breaching the clause), the employer or the other contracting party can apply to the president of the court sitting in summary proceedings (en référé) to obtain:

• An order for the immediate cessation of the competing activity
• Payment of a daily penalty for each day of delay
• Protective measures (precautionary seizure, etc.)

The time needed to obtain a summary order in Belgium is generally 2 to 6 weeks.

Burden of proof

• It is up to the party relying on the clause to prove its validity and applicability
• It is up to the party complaining of the breach to prove the actual acts of competition
• Admissible evidence: emails, witness statements, LinkedIn posts, the BCE register, invoices, etc.

Practical advice

For the employer or the client

1. Draft the clause precisely: avoid vague wording such as "any competing activity anywhere in the world"
2. Provide for a compensatory allowance, even in B2B: this strengthens validity
3. Tailor the clause to the individual's role: a sales director justifies a broader clause than a technician
4. Document the protected secrets: precisely identify the know-how, client lists and business methods
5. Include a waiver clause: allowing the employer to waive enforcement within 15 days of the contract ending (which exempts them from paying the allowance)

For the employee or the service provider

1. Negotiate the clause before signing: ask for limits on duration and territory, and adequate compensation
2. Check the pay threshold: if your gross annual salary is below EUR 41,969, the clause is automatically void
3. Keep a copy of the contract and all amendments
4. If in doubt, consult a lawyer specialising in employment or commercial law
5. Do not breach the clause while awaiting a ruling: even if you are disputing it, the risk of being penalised remains

Conclusion

The non-compete clause in Belgium is subject to strict rules that vary depending on the nature of the contractual relationship. In employment law, the conditions for validity are precisely defined by statute (pay threshold, compensatory allowance, maximum duration). In commercial law (B2B, franchising, business sales), it is case law that sets the limits, around the criteria of proportionality and limitation in time, space and scope. In every case, a poorly drafted or disproportionate clause will be declared void, leaving the company with no protection at all. Support from a specialist lawyer is therefore strongly recommended, both for drafting and for negotiating these clauses.