Starting My Own Business to Compete Against My Employer?

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30 June 2014

I work for a company which had a patented process. The patent has expired two years ago and is not been renewed.

I have a contract with the company that I can't work with similar technology for two years and I have to comply with Australian employment law.

I intend to start my company after 2 years but want to know if I am breaking any laws and if I have a legal way to handle it later.


Hi Sagar,

Once a patent lapses, anyone can then use the process or invention. Therefore there would be nothing preventing you from starting a business using the specific process in terms of IP law.

With respect to the restraint of trade clause in your employment contract, yes it is likely you will have to wait the 2 years. Australian law does render provisions which impose restrictions on a person's freedom to engage in trade or employment illegal and therefore unenforceable unless they are demonstrated to be reasonable. Assuming your restraint of trade clause is reasonable you would therefore be bound by it.

Based on the brief amount of information you have provided, I can't see anything else that would preclude you from starting your own business at the end of your restraint of trade, using the expired patent process. You would of course need to be careful to establish all of your own trademarks and intellectual property and be careful with client lists etc. Make sure you adhere to anything that your employment contract says in that regard.