Abstract
Contractual penalties that reinforce an obligation under a competition clause are a frequently discussed topic, especially since this is the only case of contractual penalties that can reinforce obligations arising from employment relationships. If another obligation arising from employment relations were to be reinforced by a contractual penalty, such a contractual penalty would only be illusory according to current case law.
Although this is such a unique case, the Labour Code offers us little help in resolving the issues surrounding contractual penalties arising from competition clauses.The paper first of all deals with the question of what contractual penalties in competition clauses actually serve for and when they are applied, followed by part with a discussion of selected issues of these contractual penalties, especially with regard to their adequacy, the possibility of moderation of contractual penalties by the court, compensation for damages in case of (non-)negotiation of contractual penalties in a competition clause or the application of subsidiarity of the Civil Code.