Can a non-compete clause be enforced if the business closed down?

Grow Your Business, Not Your Inbox

Stay informed and join our daily newsletter now!
min read
Opinions expressed by Entrepreneur contributors are their own.
Generally, if a business has closed its doors, there's no one to enforce the provision...so you're free to move forward with your activities. However, if the non-compete agreement made the terms binding on "successors and assigns" -- and your query does mention "current owners" -- this means that the terms CAN be enforced. Because non-compete agreements are usually interpreted according to state law, and the precise wording of the clause is key, you would be wise to speak to an employment attorney in your area who can review the actual document and give you clearer guidance.

More from Entrepreneur

We created the SYOB course to help you get started on your entrepreneurial journey. You can now sign up for just $99, plus receive a 7-day free trial. Just use promo code SYOB99 to claim your offer.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Create your business plan in half the time with twice the impact using Entrepreneur's BIZ PLANNING PLUS powered by LivePlan. Try risk free for 60 days.

Latest on Entrepreneur