What is unfair competition?
Unfair competition is a business practice that consists in violating existing competition rules to gain an advantage over competitors in an illegal manner. It can take many forms, such as: counterfeiting, commercial parasitism, misleading advertising, misappropriation of customers, and so on.
In France, unfair competition is punishable under the Commercial Code and the Intellectual Property Code. Victims of unfair competition can take legal action to obtain damages, as well as emergency measures to put a stop to illegal practices.
Can I take my competitor’s business?
It all depends on how you build up your customer base. In principle, it is not forbidden to attract customers who normally use another service provider.
On the other hand, the way in which you do it can be considered unfair, and characterize a case of customer misappropriation, which is illegal.
Customer “detour” consists in seeking to divert customers away from a competitor’s business by using illegal or unfair means, which can be :
- Denigration: the dissemination of false information or rumours about a competitor’s products or services, with the aim of damaging its reputation and persuading customers to change supplier.
- Use of confidential data: the illegal use of fraudulently obtained confidential information, such as customer lists, marketing plans, etc.
- Offering excessive discounts or benefits: offering excessive price reductions or other financial advantages to attract competitors’ customers.
However, if you refrain from using unfair means, you can perfectly well solicit customers who usually use another service provider to offer them your services.
Can I canvass my former employer’s clientele?
If you’ve left one company to set up a competitor, there are a number of things you need to watch out for.
If you have signed an employment contract with a non-competition clause, it is possible that this clause prohibits you from carrying out an activity that competes with that of your former employer for a given period after the end of your employment contract.
In addition, your employment contract may contain a non-solicitation clause. A non-solicitation clause prohibits an employee from soliciting his former employer’s customers or suppliers for a specified period after leaving the company. This clause is often included in
