Is a non-compete enforceable in Egypt?

It can be, but only inside the conditions of Article 686 of the Egyptian Civil Code (Law No. 131 of 1948). The work must have allowed the employee to know the employer's customers or the secrets of its business, the employee must have had full legal capacity when the contract was made, and the restriction must be limited in time, place and type of work to what is necessary to protect the employer's legitimate interests.

Can an Egyptian employer rely on a non-compete after dismissing the employee?

Article 686(3) of the Egyptian Civil Code says the employer may not invoke the non-compete agreement where it rescinded the contract or refused to renew it without the employee having done anything to justify that, and equally may not invoke it where the employer's own conduct justified the employee in ending the contract.

What happens if the liquidated damages in an Egyptian non-compete are too high?

Article 687 of the Egyptian Civil Code voids a penalty clause for breach of a non-competition undertaking where the clause is exaggerated so as to become a means of compelling the employee to remain in the employer's trade for longer than the agreed period, and the article extends that nullity to the non-competition clause as a whole.

Non-Compete Agreement in Egypt

Egypt does not regulate post-employment non-competition in the Labour Law. It sits in the Civil Code, which permits the restraint only where the job actually gave the employee access to the employer's customers or to the secrets of its business, and then only within the limits of time, place and type of work necessary to protect the employer's legitimate interests. The Civil Code also strips the employer of the clause entirely if the employer was the one who ended or refused to renew the relationship without cause, and it voids the whole non-compete if the penalty attached to it is excessive.

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Governing law

Post-employment non-competition between an employer and an employee is governed by Articles 686 and 687 of the Egyptian Civil Code (Law No. 131 of 1948). Competing activity during the relationship is separately prohibited by the Labour Law issued by Law No. 14 of 2025.

Egyptian Civil Code (Law No. 131 of 1948), Arts. 686 and 687 (Arabic text via WIPO Lex, consolidated to Law No. 55 of 1970)

What a non-compete agreement has to contain in Egypt

The parties may agree that the employee will not compete with the employer or take part in any competing venture after the contract ends only where the work entrusted to the employee allows him to know the employer's customers or to learn the secrets of its business.
Egyptian Civil Code (Law No. 131 of 1948), Art. 686(1) (Arabic text via WIPO Lex)
For the agreement to be valid the employee must have had full legal capacity at the time the contract was made, and the restriction must be confined as to time, place and type of work to what is necessary to protect the employer's legitimate interests.
Egyptian Civil Code (Law No. 131 of 1948), Art. 686(2)
The employer may not rely on the non-compete if it rescinded the contract or refused to renew it without the employee having given cause, nor if the employer's own conduct justified the employee in terminating.
Egyptian Civil Code (Law No. 131 of 1948), Art. 686(3)
During the employment relationship the worker is separately prohibited from working for a third party where doing so would let that third party learn the establishment's secrets or compete with the employer, and from carrying on or participating in an activity similar to the employer's, whether as a partner or as a worker.
Labour Law issued by Law No. 14 of 2025, Art. 136(2) and (3) (Official Gazette No. 18 (bis), 3 May 2025, Arabic)
Proven competition by a worker against the employer in the employer's own line of business is one of the gross faults listed in the Labour Law, and dismissal for gross fault may only be imposed by the competent labour court.
Labour Law issued by Law No. 14 of 2025, Art. 148

What catches drafters out

A penalty clause attached to the non-compete is void if it is exaggerated to the point of forcing the employee to stay in the employer's trade longer than the agreed period, and that nullity extends to the non-compete undertaking as a whole rather than just to the penalty.
Egyptian Civil Code (Law No. 131 of 1948), Art. 687
The Civil Code requires the restriction to be limited on all three axes at once, time, place and type of work, so a clause that names a duration but no geographic or activity limit does not satisfy Article 686(2).
Egyptian Civil Code (Law No. 131 of 1948), Art. 686(2)
The employee's duty to keep the industrial and commercial secrets of the work survives the contract by force of law, so a confidentiality obligation does not depend on the non-compete surviving.
Egyptian Civil Code (Law No. 131 of 1948), Art. 685(d)