Non-circumvention
A non-circumvention clause stops one party from bypassing another to deal directly with the contacts, suppliers or buyers that party introduced. It protects brokers, agents and sales partners whose value lies in their relationships.
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Sample Non-circumvention clauses
Non-Circumvention. ASD and its members Kevin and Jenny Thomas agrees to Non-Circumvention so long as the Agreement is in effect, and for one year after termination, and in any case ASD agrees to Non-Circumvention during the period before April 30,2023, even if this Agreement had been terminated before then but only for cause.
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Synergy CHC Corp.Mutual Non-circumvention The Company and the Consultant agree to a mutual non-circumvention on all aspects of the business. The Company, its representatives, and other consultants agree not to approach parties introduced by Consultant, on behalf of other companies with which they may be involved, without permission and involvement of Consultant. The Company agrees that the list of contacts introduced by Consultant shall be deemed confidential, and shall not be disclosed in part or in whole by another party without Consultant’s express permission. The Consultant agrees to the exact same non-circumvention provisions as it pertains to anyone that the Company introduces to the Consultant and the Consultant is bound by the same non-circumvention provisions that the Company has agreed to as described in this paragraph.
Non-Disclosure Agreement. As further consideration for the Company’s entering into this Agreement, Distributor understands and agrees that Distributor, including its affiliates, shall continue to be bound by that certain Non-Disclosure and Non-Circumvention Agreement between the Company and Distributor, dated of even date herewith (the “Non-Circumvention Agreement”).
Thus, the Non-Circumvention Agreement provided, in pertinent part, that: “The Parties agree not to disclose, reveal or make use of any information during discussion or observation regarding methods, concepts, ideas, products/ services, or proposed new products or services, nor to do business with any of the revealed contacts without the written consent of the introducing party or parties. This includes the security and integrity of the disclosing parties [sic] crucial business information, customers, process, and procedures including trade and brand names and all copyrighted material.”
The NC/NDA also provided a “penalty” provision as protection to the Plaintiff to ensure that Defendant NSAV did not “circumvent” its obligations to compensate Mr. Grover for his efforts and network of contacts in the investment community. As a result, the Non-Circumvention Agreement further provided, in pertinent part, as follows: “In case of circumvention …, the Parties agree and guarantee that they will pay a legal monetary penalty that is equal to the commission or fee the circumvented Party should have realized in such transactions, by the person(s) engaged on the circumvention on each occurrence, or the gross revenue realized by the circumventing party in each instance[,] whichever is greater. If either party commences legal proceedings to interpret or enforce the terms of THIS AGREEMENT, the prevailing Party will be entitled to recover court costs and reasonable attorney’s fees.”
Pursuant to the Non-Circumvention Provision, during the Term and for a period of 12 months from the date of termination of the Agreement for any reason, the Contractor shall not solicit on behalf of any other entity, any Target with which officers or directors of the Company met (in person or by videoconference or teleconference) for purposes of effecting a Transaction with, or other substantial strategic investment into such Target with any entity other than the Company, unless given explicit written authorization to do so by the Company’s chief executive officer or chief financial officer.
Non-Circumvention. ABTI hereby agrees that from the effective date of this Letter of Intent that it shall not negotiate, enter into or attempt to negotiate or enter into any agreement, covenant or understanding, written or oral, directly or indirectly, that could in any manner be construed to be inconsistent with this Letter of Intent or could undermine any of the rights or interests of the other party in, under or in respect of this Letter of Intent and agrees not to interfere with, circumvent, frustrate or otherwise impede in any manner the realization by the other party of any of the objectives it seeks or benefits derived, or to be derived, from any of the foregoing. ABTI further agrees that, for a period of two years from the effective date of this Letter of Intent, that it shall not, directly or indirectly through an affiliate, solicit, discuss, pursue, or enter into any transaction or agreement with any person (including any firm, partnership, or other entity) directly or indirectly introduced to it by BGXX without in each case the prior written consent of BGXX, which consent may be given or withheld in its discretion and may be conditioned on payment of a transaction fee.
Non-Disclosure Agreement. As further consideration for the Company’s entering into this Agreement, Distributor understands and agrees that Distributor, including its affiliates, shall continue to be bound by that certain Non-Disclosure and Non-Circumvention Agreement between the Company and Distributor of even date herewith (the “Non-Circumvention Agreement”).
Scope of Confidentiality and Non-Circumvention. It is not necessary that this Agreement reference specific transaction(s) in order to be effective with regards to confidentiality and non-circumvention since this Agreement is intended to be a continuing obligation between the Parties as to all Information communicated until notice of termination is acknowledged by the both of them.
Non-Circumvention. LMI and the Company agree not to circumvent each other and shall abide by business principles regarding non-circumvention. No party to this agreement shall in any way whatsoever circumvent or attempt to circumvent the other by entering into any negotiation or dealing with business contact associates or partners of the other party with whom they might have become acquainted in the course of the implementation of this Agreement, without the written consent of the other party concerned. The parties agree to keep confidential the names of any contacts introduced or revealed to the other party, and that their firm, company, associates, corporations, joint ventures, partnerships, divisions, subsidiaries, employees, agents, heirs, assigns, designees, or consultants will not contact, deal with, negotiate or participate in any transactions with any of the contacts without first entering a written agreement with the disclosing party unless that party gives prior written permission. Such confidentiality will include any names, addresses, telephone, telex, facsimile numbers, and/or other pertinent information disclosed or revealed to either party.
Non-Circumvention: During the Term of this Agreement, as well as any Renewal Term thereof, and for a period of eighteen (18) months following the Termination or Termination For Cause of this Agreement, the Parties hereto, corporately, individually and personally, and as to their respective directors, officers, employees and agents, agree not to directly or indirectly, for themselves or any other individual or entity, consult for, sell for or to, market for or to, refer to, any party with whom the other Party may have a business relationship, including but not limited to the representation of a third-party seeking to solicit a business relationship therewith.
Source
C3 Capital, Inc.Non-circumvention
Each Party agrees not to transact business or attempt to transact business with any third-party whose identity or contact information is made known to another Party pursuant to this Agreement without the express written permission of such Party providing the information. The Parties further agree not to circumvent, avoid or bypass the other, directly or indirectly in anyway with regard to a transaction with a third-party that becomes known to a Party through Confidential Information. This non-circumvention shall include, but not be limited to, any transaction arising out of the Parties’ discussions pursuant to this MOU.
Non-Circumvention. It is hereby agreed that the Manager will not circumvent GreenPower in any of its business dealings or transactions.
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LOGIQ, INC. (LGIQ)Non-Circumvention. Each Party agrees that it shall not attempt in any way to directly or indirectly circumvent the other Party in contacting, conducting or concluding any business with any revealed contacts, clients or entities (including without limitation, identities of, and contact information for: suppliers, manufacturers of equipment, partners, licensors, prospective investors, or prospective investments). This non-circumvention obligation shall apply to the Parties and their representatives and shall remain in effect until one (1) year from the date or dates the information creating such obligation was revealed.
Non-Circumvention. (a) The Seller agrees not to contact or initiate contact at any time for any purpose, either directly or indirectly, in connection with the RH Concept or Supernus Products, or any other property or properties whose identity was revealed through the efforts of the Company (or its subsidiaries or affiliates), unless such approval is specifically granted in written form by Company on a case-by-case basis. The Seller further agrees not to undertake any transaction or a series of transactions of any kind in connection with any Company Opportunity (hereinafter defined) or to collect any fees in connection with a Company Opportunity without the express prior written consent of Company, which consent may be withheld in Company’s sole discretion. (b) The term “Company Opportunity” means and includes each and every business opportunity that is within the scope and purpose of the RH Concept or Supernus Products.
Non-Circumvention and Non-Solicitation. a. Non-Circumvention. The Buyer agrees not to contact persons or entities introduced by the Company without the prior written consent of the Company. Furthermore, the Buyer agrees that the Buyer shall not utilize confidential information nor consummate any transaction, for fees or otherwise, with any entity (including such entity’s affiliates and related entities) introduced by the Company without providing compensation to the Company in an amount deemed acceptable to the Company at the Company‘s sole discretion. The provisions of this Subsection shall apply during the term of this Agreement and for two (2) calendar years thereafter.
What does non-circumvention mean?
Non-circumvention means a party promises not to go around you to deal directly with the contacts you introduced. If a broker introduces a buyer to a supplier, a non-circumvention clause stops the buyer and the supplier from closing the deal without the broker, or from cutting the broker out of later deals with each other.
The clause protects anyone whose value lies in their relationships: brokers, agents, sales partners, finders and consultants who bring parties together.
Non-circumvention clause vs non-circumvention agreement (NCNDA)
| Non-circumvention clause | Non-circumvention agreement | |
|---|---|---|
| Where it sits | Inside a larger contract, such as a referral, agency or partner agreement | A standalone contract, signed before any contacts are shared |
| Typical use | Sales partner and referral deals | Brokered trades, commodities, real estate, M&A introductions |
| Usually combined with | The contract’s confidentiality clause | Non-disclosure terms, as an NCNDA (non-circumvention, non-disclosure agreement) |
An NCNDA is common where intermediaries bring buyers and sellers together, for example in commodity trading, where the parties sign it before any names are disclosed.
What a non-circumvention clause should cover
- Who is protected: the contacts, suppliers, buyers or opportunities introduced, ideally listed in a schedule.
- What is prohibited: dealing directly or through third parties in a way that cuts out the introducing party.
- How long it lasts: commonly two to five years from the introduction or from the end of the contract.
- What happens on breach: usually the commission or fee the introducing party would have earned, plus the right to an injunction.
- Exceptions: contacts a party already knew, which should be documented.
Non-circumvention clause example
Sample clause: Non-circumvention
Add this clause to a contract, send it and get it signed in fynk.
Use it in fynk for freeIs a non-circumvention clause enforceable?
Usually, if it is reasonable. Courts treat it like other restrictive covenants: it should protect a real business interest, name the protected contacts, and last for a limited time. A clause that bars a company from ever dealing with an entire industry is likely to fail. Listing introduced parties in a schedule and keeping a written record of each introduction makes the clause much easier to enforce.
In fynk you can keep each introduction on record and store the protection period as contract metadata, so you can see which contacts are still protected and get a reminder before the period ends.
Which contracts include a non-circumvention clause?
Sales partner, referral and finder’s fee agreements, agency and brokerage agreements, joint ventures and NDAs signed before introductions. One of these free templates already includes the clause; the other two are where it is most often added:
Free templates for this clause
Sales partner referral agreement templateAlready includes a non-circumvention clause that stops the company from dealing directly with approved prospects to cut out the sales partner.
Use the free template
Mutual non-disclosure agreement (NDA) templateAdd the clause to turn this mutual NDA into an NCNDA before you share any contacts.
Use the free template
Marketing and customer referral agreement templateAdd the clause so referred customers stay credited to the partner who brought them.
Use the free template
Related clauses
- Non solicitation agreement A non-solicitation agreement is a contract clause prohibiting an individual from soliciting a company's clients or employees for a specified period after leaving the organization. This clause is designed to protect a business's relationships and workforce from being disrupted by former employees or business partners.
- Confidentiality clause A confidentiality clause is a provision in a contract that obligates one or both parties to keep certain information confidential and not to disclose it to third parties without prior consent. This clause is designed to protect sensitive information such as trade secrets, business strategies, and proprietary data shared during the course of the contractual relationship.
- Exclusivity An exclusivity clause is a contractual provision that restricts one party from engaging in certain activities or dealings with other parties outside the agreement. Typically used to secure a commitment, it ensures that the party provides services, products, or rights solely to the other contracting party, often to maintain competitive advantage or preserve confidentiality.
- Breach of confidentiality A breach of confidentiality clause stipulates the obligations and responsibilities of parties to protect sensitive information from unauthorized disclosure or misuse. It outlines the repercussions and potential legal ramifications should any party fail to uphold these confidentiality commitments.
Frequently asked questions
Non-circumvention stops a party from going around you to deal with the contacts you introduced. Non-solicitation stops a party from luring away your employees or customers. Many contracts include both.
Most run for two to five years, counted from the introduction or from the end of the contract. Longer periods are harder to enforce unless the deal justifies them.
An NCNDA is a non-circumvention, non-disclosure agreement: one contract that both keeps shared information confidential and stops the parties from bypassing the person who introduced them.
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