Keywords: Competition Ordinance, Non-Solicitation Agreements

In the previous episode of this series, Mayer Brown JSM discussed the implications of sharing sensitive HR information when the Competition Ordinance comes into force. Colin is now puzzled by the potential problems relating to non-solicitation agreements...

Colin: You mentioned that a non-solicitation agreement with a competitor could pose "problems" under the Competition Ordinance. What kind of "non-solicitation agreement" were you referring to?

Mayer Brown JSM: I was referring to an agreement between competitors operating in the same market not to solicit employees from each other. In fact, a simple arrangement or acknowledgement not to poach a competitor's employees may violate the Competition Ordinance.

Colin: But I don't understand. How would this affect competition?

Mayer Brown JSM: This type of non-solicitation arrangement would restrict an employee's mobility, which would in turn distort competition in the job market.

In fact, the legality of this type of non-solicitation agreement came under scrutiny recently in a high profile antitrust court case in the United States involving key players in the technology industry. The case eventually ended with an agreement to settle with the affected employees, but by August 2014, the settlement sum was still in dispute.

Colin: Okay, I won't get involved in any non-solicitation arrangement with a competitor then...

Learn more about our Hong Kong office, Antitrust & Competition, Employment & Benefits and Hong Kong Competition Law practices.

Visit us at

Mayer Brown is a global legal services organization comprising legal practices that are separate entities (the Mayer Brown Practices). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; Mayer Brown JSM, a Hong Kong partnership, and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2014. The Mayer Brown Practices. All rights reserved.

This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein. Please also read the JSM legal publications Disclaimer.