Non-exclusivity: Overview, definition, and example
What is non-exclusivity?
Non-exclusivity is a clause that makes clear that one party is not granting the other exclusive rights under the agreement. It allows both parties—usually the one offering goods, services, or opportunities—to work with others outside the agreement. This term is common in commercial, licensing, referral, and partnership agreements.
Why is non-exclusivity important?
This clause protects a party’s freedom to engage with third parties and prevents misunderstandings about the nature of the relationship. Without it, one party might wrongly assume they have sole rights to a product, service, territory, or relationship. Including a non-exclusivity clause helps manage expectations and avoids unintended exclusivity that could limit business flexibility or violate other contracts.
Understanding non-exclusivity through an example
A SaaS provider enters into a reseller agreement with a marketing firm. The contract includes a non-exclusivity clause, allowing the provider to continue working with other resellers. If the marketing firm later claims it had exclusive rights to a territory or customer group, the clause provides clear proof that the agreement was non-exclusive and the provider is free to engage with others.
Example of a non-exclusivity clause
Here’s how a non-exclusivity clause may appear in a contract:
"Nothing in this agreement shall be construed to grant either party exclusive rights with respect to any products, services, or markets. Each party remains free to enter into similar agreements with third parties."
Conclusion
The non-exclusivity clause preserves flexibility and avoids misunderstandings about exclusivity rights. It allows both parties to pursue additional business relationships without breaching the agreement. If you're entering into a collaboration or sales arrangement, this clause is a simple but powerful way to keep your options open.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.