Clause guide
Exclusivity Clause clause: meaning, risks, and what to negotiate
Prevents one party from working with competitors or other partners during the contract term.
What it means
Exclusivity clauses can limit your ability to work with other clients or vendors. They may also reduce your negotiating leverage by locking you into one relationship.
Common risks
- • You may be prevented from working with other clients.
- • The exclusivity scope may be too broad.
- • The clause may last longer than the contract itself.
What to check before signing
- • What activities are restricted?
- • How long does the exclusivity last?
- • Does it apply globally or only to specific markets?
Negotiation ideas
- • Limit exclusivity to specific services or industries.
- • Add a clear end date.
- • Allow exceptions for existing clients.
Example clause
“During the Term, Provider shall not provide substantially similar services to any direct competitor of Client within the defined market.”
Frequently asked questions
Are exclusivity clauses common?
Yes, especially in partnerships, distribution deals, and strategic vendor agreements.
Related clauses
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