A similar case was considered by the Constitutional Court of the Czech Republic in its ruling of 21.5.2021, file number II. ÚS 1889/19 (hereinafter referred to as the “Rule”). The Constitutional Court found that the employer had abused its right to withdraw from the non-compete clause and, within the Rule, provided a demonstrative list of circumstances that the courts should examine in proceedings to determine whether withdrawal from a non-compete clause is not an abuse of law.

These circumstances are:

• the time when the employer withdrew,
• if the employer withdrew from the non-compete clause just before the end of the employee’s employment, then consider the reason why it could not have done so earlier (the employer should be able to explain it at least in court proceedings),
• if the employer withdrew from the non-compete clause without giving a reason, the reason why it considered the parties‘ binding nature to be undesirable, unreasonable, unsustainable or unfair (the employer should be able to explain it at least in court proceedings),
• facts indicating that the employee chose his future employment or other career path precisely with regard to his binding nature to the non-compete clause (e.g. he already found a profession that meets the requirements arising from the non-compete clause, or, conversely, he rejected the offer of a profession that did not meet these requirements), or
• facts indicating that the employer acted arbitrarily or abused his right to withdraw from the non-compete clause (e.g., he wanted to be released from the obligation to provide the employee with financial compensation at a time when he knew or could and should have known that the employee had chosen his future employment or other career path precisely with regard to his being bound by the non-compete clause).

In its judgment of 27.1.2025, file no. 27 Cdo 1236/2024 (hereinafter referred to as the “Judgment”), the Supreme Court addressed whether the above-mentioned conclusions of the Constitutional Court can be applied to contracts for the performance of duty agreed between the company and members of the statutory body.

In the aforementioned case, the company withdrew from the non-compete clause only on the last day of the period in which it could do so, although it had known about the resignation of the member of the statutory body for at least four months.

The Supreme Court summarized in the Judgment that although the above-mentioned Judgment concerns non-compete clauses from the perspective of labor law, the conclusions expressed by the Constitutional Court regarding the abuse of rights also apply to non-compete clauses with the possibility of unilateral withdrawal without giving a reason, agreed between commercial corporations and their statutory bodies.

The Supreme Court’s decision is based on the established case law of the Supreme Court, from which summarizes following conclusions:

• The prohibition of the abuse of rights is an institution embodying the corrective function of the principle of honesty. It serves to deny legal protection to such an exercise of rights that formally corresponds to the law or the content of the existing legal relationship, but which is unacceptable due to the circumstances of the case.
• For obvious abuse of rights within the meaning of the provisions of Section 8 of Civil Code, which is not legally protected, can only be considered such conduct, the aim of which is not to achieve the purpose and meaning pursued by the legal norm, but which is, in contradiction to established good morals, led by the direct intention to cause harm to another participant, or that it is the exercise of a right contrary to its purpose, when the right is exercised, although the holder of this right has no real or only a slight interest in its exercise, or that manifests itself as a contradiction between the benefit of the entitled party, to whom the exercise of the right is actually directed, and the benefit of the entitled party for whom the right is provided, which in its extreme form can take on the nature of so-called bullying, which is the exercise of the right for the purpose of harming the other party.

By its judgment, the Supreme Court overturned the contested judgments of the lower courts in order to deal with the possibility of abuse of the right, even though the non-competition clause was not agreed as part of the employment relationship.

In the event of reasonable suspicion that commercial corporations might abuse their right to unilaterally withdraw from a non-competition clause agreed with a member of the statutory body, courts of first instance should, in accordance with the Judgment, apply the procedure set out in the Finding and consider whether this constitutes an abuse of law or not.