Non-compete clause for shareholders of a GmbH

The individual shareholder has in particular a duty of noncompetition and a duty of loyalty towards the GmbH and all its shareholders. A non-competition clause may also be imposed on a shareholder of a limited liability company by analogy with Section 112 of the German Commercial Code (HGB), based on the duty of loyalty as a member’s duty to refrain from competition. This applies in particular if the non-competition clause is either contractually agreed or the shareholder in question exercises or can exercise a special influence on the company, for example as a managing partner, because the GmbH is structured in an emphatically personalised manner.

The non-competition clause is breached if the shareholder in question has a majority shareholding in another competing company or otherwise controls it, although a mere minority shareholding in a competing company is generally not detrimental.

It should be noted that non-competition clauses in the articles of association of a GmbH may violate the Act against Unfair Restraints of Competition. If this is the case, it should be assessed by a specialised lawyer. In particular, it must be examined whether a non-competition clause is also necessary and permissible vis-à-vis a minority shareholder in order to maintain the company’s ability to function and to protect it from being undermined or destroyed from within by the shareholder.

If there is a non-competition clause, its restriction or even its abolition requires an inclusion in the articles of association, in case of doubt a three-quarters majority of the votes by way of an amendment to the articles of association, provided that the measure is not contrary to the interests of the company.

8th November 2024