In federal contracting, can a prime contractor tell a subcontractor that if the subcontractor works for a competitor he cant work for him

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In federal contracting, can a prime contractor tell a subcontractor that if the subcontractor works for a competitor he cant work for him

Asked on June 1, 2009 under Business Law, California

Answers:

J.M.A., Member in Good Standing of the Connecticut Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Parties can agree to just about any terms so long as they do not violate public policy.  In this case, the prime contractor wants to make sure he is not hiring subs that work for competitors that is its business.  I am not aware of any laws that prohibit such conduct.  The only way that i know that this can be an issue is where the prime contractor fails to honor a bid for a job becasue the sub works for a competitor.  Other than that, the prime can contract with whoever it wants.


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