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The Restraint of Trade Doctrine in the Era of Digital Markets

David Thorpe
(2015) 32 Journal of Contract Law 124



It is now commonplace for trade in goods and services through the digital communications networks to involve commercial interests as diverse as medical surgery, educational services and the sale of sporting equipment. Rational covenantees will seek to protect and expand their trade interests by imposing on covenantors restraints on their use of cyberspace for purposes of trade. For courts of law the challenge will be to accommodate the competing interests of covenantees and covenantors. To not do so is to award to covenantees as the dominant contracting party a market of increasing global importance. This paper considers the application of the restraint of trade doctrine to the ‘cyber-markets’. The legitimate interests of covenantees and the question of reasonableness are considered. It is proposed that the very nature of the cyber-markets offers a unique opportunity for courts, through the acceptance of ‘micro-markets’ and policy adjustment, to promote freedom of trade in the digital marketplace.



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