Is a non-compete clause enforceable in Myanmar?
A non-compete clause is enforceable in Myanmar only if it is reasonable in duration, geography, and scope. Typical maximum duration post-employment is 6 months, narrowly tailored to the employee's role and a specific competitive risk. Overly broad non-compete clauses are not enforced. The Employment & Skills Development Law (ESDL) 2013 framework allows reasonable restraints; courts apply a reasonableness test.
What Myanmar law says
A non-compete clause prevents the employee from joining a competitor or starting a competing business for a period after leaving. Under the Employment & Skills Development Law (ESDL) 2013 framework, non-compete clauses are enforceable in Myanmar only if they pass a reasonableness test — narrowly tailored in duration, geography, and scope, and tied to a legitimate business interest such as protection of trade secrets or client relationships. Overly broad non-compete clauses (e.g., "anywhere in the world for 5 years") are routinely held unenforceable.
Reasonableness factors Myanmar courts consider
- Duration — typical maximum 6 months post-employment; longer durations rarely upheld.
- Geography — should match where the employer actually competes (city, region, country).
- Scope — limited to roles or industries where the employee had access to confidential information.
- Consideration — was the employee compensated for the restraint (e.g., garden leave, salary continuation)?
- Seniority — non-compete more enforceable for senior staff with access to trade secrets than for junior staff.
- Legitimate business interest — protecting client relationships, trade secrets, or specialised training investment.
Drafting tips
| Element | Reasonable | Unreasonable |
|---|---|---|
| Duration | 3 – 6 months | 2+ years |
| Geography | Yangon and Mandalay regions | "Anywhere in the world" |
| Scope | Direct competitors in the same industry | Any business activity |
| Role coverage | Senior or technical roles | All employees blanket |
| Consideration | Salary continuation during the restraint | None |
What if there's a dispute
- Township labour office first — typical complaint is the employer over-broad non-compete clause restricting the employee from finding work.
- Conciliation Body — formal conciliation under the Settlement of Labour Disputes Law.
- Arbitration Council — final binding step. Statute of limitations: typically 6 months.
Employer takeaway
Limit non-compete clauses to senior or technical roles, set duration at 3–6 months max, define geography narrowly, and identify the legitimate business interest. Pair the restraint with consideration (e.g., garden-leave salary continuation) to improve enforceability. Run final settlement within 7 days of last working day, deregister from SSB within 30 days, and keep records for at least 7 years.
Edge cases and unenforceable clauses
- Non-compete with no consideration — weakens enforceability significantly.
- Non-solicit clauses — generally more readily enforceable; see non-solicit.
- NDA clauses — enforceable for trade secrets; see NDAs.
- See maximum non-compete duration.
Common non-compete mistakes
- Copying a multinational global template with 2-year worldwide non-compete.
- Applying non-compete to junior or operational staff.
- Skipping consideration (no garden-leave salary).
- Failing to define "competitor" with specificity.
- Employment & Skills Development Law (ESDL) 2013 — restrictive covenants
- Notification 84/2015 (or current) — termination framework
- QHRM Myanmar Termination Compliance Guide
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