Colour Books Ltd/Allied Combined Trust Ltd/Share Subscription Agreement [1995] IECA 428 (19th October, 1995)

Colour Books Ltd/Allied Combined Trust Ltd/Share Subscription Agreement [1995] IECA 428 (19th October, 1995)

The notified agreement, as amended by the waiver limiting the non-compete clause to one year after cessation of shareholding, does not offend Section 4(1) of the Competition Act, 1991. The non-compete and shareholder retention provisions are justified as necessary for the protection of the investment and do not restrict competition beyond what is reasonable.

Citation
[1995] IECA 428
Parties
Notified Party: Colour Books Ltd; Covenantor/shareholder/director: John Harold; Subscriber/investor: Allied Combined Trust Ltd (ACT)
Jurisdiction
Ireland
Procedural Posture
Competition Authority Notification / Decision on Certificate Under Section 4(4) of the Competition Act, 1991
Outcome
Certificate issued that the agreement does not offend Section 4(1) of the Competition Act, 1991
Legal Topics
Share Subscription Agreement, Non Compete Clause, Venture Capital Investment, Minority Shareholder Protections
Competition Law Share Subscription Agreement Non Compete Clause Venture Capital Investment Minority Shareholder Protections

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Parties

Colour Books Ltd

Notified Party

John Harold

Covenantor/shareholder/director

Allied Combined Trust Ltd (ACT)

Subscriber/investor

Procedural Posture

Competition Authority Notification / Decision on Certificate Under Section 4(4) of the Competition Act, 1991

Legal Issues

  1. 1 Whether the share subscription agreement, including non-compete and shareholder retention clauses, offends Section 4(1) of the Competition Act, 1991

Ratio Decidendi

The notified agreement, as amended by the waiver limiting the non-compete clause to one year after cessation of shareholding, does not offend Section 4(1) of the Competition Act, 1991. The non-compete and shareholder retention provisions are justified as necessary for the protection of the investment and do not restrict competition beyond what is reasonable.

Court Disposition

Certificate issued that the agreement does not offend Section 4(1) of the Competition Act, 1991

Orders

  • Certificate granted under Section 4(4) of the Competition Act, 1991 for the Share Subscription Agreement as amended by the waiver dated 15 September 1995