The Czech Supreme Court refers to the EU Commission’s notice on ancillary restraints in a private dispute over non-competition Clause in SPA (K.D/Z.)

This case concerns litigation before Czech civil courts concerning a breach by a seller of a non-competition clause entered into in connection with a share sale transaction. It shows how Czech civil courts “struggled” with the application of competition law to the transaction. At the end of the day, the Czech Supreme Court upheld (on 26 March 2008) the finding of the Superior Court in Prague that a non-competition clause was valid and that a purchaser of shares may lawfully claim payment of contractual penalty for its breach. The Supreme Court considered the clause directly related and necessary to the concentration at hand. Summary of Procedure and Courts' Reasoning The facts of the case were as follows. On 1 October 1998, the claimant (K.D., a.s. / a joint stock company) and the

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  • Skils (Prague)

Quotation

Jiri Kindl, The Czech Supreme Court refers to the EU Commission’s notice on ancillary restraints in a private dispute over non-competition Clause in SPA (K.D/Z.), 26 March 2008, e-Competitions March 2008, Art. N° 22066

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