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SINGAPORE HIGH COURT RULES THAT FORFEITURE-FOR-COMPETITION CLAUSES ARE NOT RESTRAINTS OF TRADE

November 2011 - Employment. Legal Developments by Drew & Napier LLC .

More articles by this firm.

Mano Vikrant Singh v Cargill TSF Asia Pte Ltd [2011] SGHC 241

In a landmark decision, the Singapore High Court has ruled in favour of an employer, holding that a clause in an employee incentive bonus plan which requires the employee to forgo deferred incentive payments if he resigns and joins a competitor (referred to as a “forfeiture-for-competition” clause) is not a restraint of trade. The employer need not show that such a clause is reasonable in order to enforce it.

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Established in 1889, Drew & Napier LLC is one of Singapore's leading and largest law firms, with over 250 lawyers and fee-earners. Consistently rated top tier in dispute resolution over the years by international ranking organisations such as Asia Pacific Legal 500, Chambers Global, Practical Law Company, Best Lawyers and Asia Law, the firm has 7 Senior Counsel. The firm is headed by chief executive officer, Davinder Singh, Senior Counsel. Drew & Napier LLC is also rated top tier in Corporate Insolvency & Restructuring, Intellectual Property (Patents and Trademarks), Competition & Antitrust, Telecommunications, Media & Technology and Tax, with market leading practices in Mergers & Acquisitions, Corporate Finance, and Admiralty & Shipping. For more information, please visit www.drewnapier.com