Buying a Business

Posted by $$ (395 days ago)

I bought a business a few months back. The previous owner opened the same business in the same building and is now telling people that the business I bought is already closed. What kind of action could I take? I have talked to her a few times about this but still our customers have told us that these people are telling them that our business no longer exists. Can someone help me? Thanks

(I am based in Hong Kong)

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Posted by Bizeemama (394 days ago)

Did you not have any "restrictions" placed in the terms of sale agreement.
For example "Vendor may not open a business of similar nature within an x amount of km radius for x amount of years"
These clauses have to be fare in time and space but are prudent to place in a sale agreement so that the scenario as mentioned above does not occur. I hope you have something in place and if you do they are breaking the terms of the sale agreement and you can take issue.
Buyer beware.

(I am based in Hong Kong)

Posted by Bizeemama (394 days ago)

It also depends on the nature of the business. Some professional bodies have "codes of conduct" which are an international standard. I am not sure the nature of your business but this may be a "technicality" that may give you some in roads (but it really depends on the business nature and the professional codes of any (if any) employed by that business.

(I am based in Hong Kong)

Posted by associates (380 days ago)

If you have a restrictive covenant in the agreement for sale and purchase with the previous owner restricting him to operate same business within the same building or in the vicinity of the building, then you may sue him for breach of agreement . The basis of your claim depends on the working of the agreement and any collateral correspondence and undertakings.


Weir & Associates
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Tel : 2526-1767
Fax : 2868-3568
emailj : weirlaw@hongkonglaw.com
www.HongKongLaw.com/weirlaw

(I am based in Hong Kong)