The Restrictive Trade Practices (Sale and Purchase and Share Subscription Agreements) (Goods) Order 1989

Share Subscription Agreements

6.—(1) In determining whether an agreement to which article 5 applies is an agreement to which the Act of 1976 applies by virtue of section 6 of that Act, no account shall be taken of any relevant restriction—

(a) which is accepted for a period not exceeding that permitted under paragraph (2) below; and

(b) which limits the extent to which the person accepting the restriction may compete with the issuing company, or may be engaged or interested in, disclose information to, or otherwise assist any business which so competes.

(2) For the purpose of paragraph (1)(a) above, a permitted period is:—

(a) a period of 5 years beginning with the date of the agreement; or

(b) in the case of restrictions accepted—

(i) by a member of the issuing company, a period beginning with the date of the agreement and ending 2 years after the date on which that person ceases to be a member; or

(ii) by an individual who is to have a contract of employment with or a contract for the supply of services to the issuing company, a period beginning with the date of the agreement and ending 2 years after the date of expiry or termination of the contract, whichever ends the later.