In brief

• Post-termination restrictions are under the microscope in a number of jurisdictions and continue to face challenges in enforcement.
• Regional roles make conventional country-based geographical restrictions difficult to apply.
• Territorial scope should be supported by evidence of the employee’s clients, responsibilities and access to confidential information.
• Employers should review restrictions when roles change, rather than waiting for a dispute.

Why does territorial scope matter now?

Many restrictive covenants were drafted for a simpler model of employment: one employing entity, one place of work, one defined market and one set of clients. That model no longer reflects the reality of how many senior employees in the UAE, and the wider region, actually work.

A regional sales lead based in Dubai may manage relationships in Saudi Arabia, Qatar and Egypt. A senior executive employed by a UAE regional headquarters may sit on regional committees, access group strategy and travel frequently across the Gulf Cooperation Council (the "GCC"). An employee may be based in the DIFC but spend most of their time supporting clients outside the UAE. In each case, the question is no longer simply whether a non-compete or non-solicit is enforceable (in theory) in the place where the employee is based. The more difficult question is: where should the restriction apply?

Territorial scope is one of the most common pressure points in a restrictive covenant dispute. A territory that is...

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