If you have agreed neither exclusivity nor any other prohibition, then generally yes. Under a non-exclusive agency the Commercial Code allows the agent to carry on the same activity for other persons; under an exclusive agency they may not do so within the agreed scope, and a breach entitles you to withdraw from the contract. Even a non-exclusive agent, however, is bound to have regard to your interests and not to misuse the information obtained from you.
You discover that your commercial agent is also offering a competing brand in the same region, sometimes to the same customers. The first reaction is usually that this is an obvious breach of contract. The Commercial Code (Act No. 513/1991 Zb.) sees it differently: what matters is whether you agreed an exclusive agency, or some other prohibition, and how precisely you defined it.
Without agreement, the agency is non-exclusive
The statute proceeds from the premise that an agency is not exclusive. The agent then has a free hand, and so do you:
Unless the contract provides otherwise, the principal may also entrust other persons with the commercial agency agreed with the commercial agent, and the commercial agent may carry on the activity to which they have undertaken towards the principal for other persons as well, or conclude transactions forming the subject of the commercial agency for their own account or for the account of another person.
— Section 664 of the Commercial Code (unofficial English translation)
If your contract is silent on competition, the agent generally does not breach it by selling for another manufacturer as well. The rule is, however, non-mandatory, so the contract may narrow it, and it may do so without declaring the agency exclusive.
An exclusive agency binds both sides
Under an exclusive agency governed by Section 665, the principal undertakes not to use another agent in the specified territory and for the specified range of transactions, and the agent, within the same scope, may not represent other persons or conclude those transactions for their own or another’s account. If they do so anyway, the statute gives you a clear remedy:
Where an exclusive commercial agency has been agreed and the commercial agent carries on for other persons the activity forming the subject of their obligation towards the principal, the principal may withdraw from the contract.
— Section 672(2) of the Commercial Code (unofficial English translation)
Withdrawal for such a breach has a further consequence: where the principal withdraws from the contract for the agent’s breach of a contractual obligation giving rise to a right of withdrawal, the agent acquires no right to an indemnity (Section 669a(a)). Exclusivity works in the other direction too. You may conclude transactions in the exclusive territory yourself, but unless the contract provides otherwise you will pay the agent commission on them as if they had been concluded with the agent’s assistance (Section 666).
Note how it is defined. The prohibition applies “in the specified territory and for the specified range of transactions”. If the contract states only the territory and does not define the product range, or vice versa, there is a risk of a dispute over whether sales of a competing product fall within the exclusivity at all.
What applies even under a non-exclusive agency
Even an agent who may work for others must, under Section 655(1), act with professional care and in good faith, have regard to your interests and act in accordance with your authorisation and reasonable instructions. This provision cannot be departed from by contract; it is among those listed in Section 263(1).
Confidentiality is added to this. The agent may not, without your consent, disclose to other persons the information obtained from you in the course of their activity, or use it for themselves or for others where this would conflict with your interests, and that duty continues after the contract ends (Section 657). An agent permitted to sell a competing brand therefore still may not pass your price list, discount terms or new product launch plans to a competitor. In such a breach, what you can prove is decisive, so it pays to keep a record of which materials you gave the agent and when.
How to set this up in the contract
If you want the agent not to work for a competitor, say so expressly in the contract. You have a choice:
- an exclusive agency with a precisely defined territory and range of transactions, binding both parties,
- a prohibition on representing competing products under a non-exclusive agency, where you want to retain the option of several agents in the territory,
- a duty to notify every new agency for another manufacturer in the same field, so that you learn of any overlap in good time.
A ban on competing activity during the term of the contract must be distinguished from a non-compete clause after it ends. The latter has its own statutory limits, discussed in our answer on a commercial agent’s non-compete clause. How commissions on transactions already in progress are calculated on separation is covered in our answer on commission after the end of a commercial agency.
If you are preparing an agreement with an agent or dealing with a particular overlap, send it to us. Through commercial agency agreements we assess whether the exclusivity is defined so that you can rely on it, and propose wording matching how your sales network actually works.
This answer provides general information on the law as at 12 September 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.
