What is it?
Clause type | A negative covenant governing restricted activities or conduct within an agreement (e.g., non-compete clauses).
prohibited
Contract LawLegal glossary term
Quick answer
What does prohibited mean?
Prohibited usually means conduct that is explicitly forbidden by law, contract, or regulation. In contracts, it establishes clear boundaries on permissible actions, risking material breach remedies like injunctions. Before signing, verify the source and scope of the restriction—is it statutory, contractual, or regulatory?
Definitions
What is prohibited?
Legal Definition
A prohibited act describes conduct explicitly forbidden by law, contract clause, or governmental regulation. Breaching a prohibition creates a material breach, potentially triggering remedies like injunctive relief or rescission of an agreement. Practitioners must verify the source and scope of the restriction—whether it is statutory, contractual, or regulatory.
Plain-English Translation
A prohibited action is like getting permission to play with only certain toys; you cannot touch anything else. If you break that rule, you might get a time-out until you learn better behavior.
Term context
How prohibited shows up in legal documents
Why does it matter?
Ignoring a prohibition usually constitutes a material breach, giving the injured party the right to seek damages or void the contract. The breaching party bears the risk of financial loss and litigation.
When does it matter?
A prohibition takes effect immediately upon execution of an agreement containing restrictive covenants, or when a new statute is officially published and enforced.
Where is it usually seen?
Non-compete clauses appear in employment agreements; regulatory limits are found in administrative rules (e.g., EPA regulations); security restrictions live in loan documents.
Who is affected?
Lessor | Controls what the tenant can modify or use on the property. Employee | Limits activities outside of work hours. Borrower | Restricts collateral disposal without lender consent.
How does it work?
First, a contract must clearly identify the specific activity that is restricted or banned. Then, the prohibition must be reasonable in scope and duration to be enforceable by a court. Finally, any attempt to perform the prohibited action exposes the party to immediate legal challenge.
Contract relevance
Why prohibited matters in contracts
Ignoring a prohibition usually constitutes a material breach, giving the injured party the right to seek damages or void the contract. The breaching party bears the risk of financial loss and litigation.
Document context
Where prohibited appears in documents
| Document type | Section | Why it matters |
|---|---|---|
| Non-Disclosure Agreement (NDA) | Confidential Information Use | Defines specific uses that are prohibited to protect proprietary data. |
| Employment Contract | Restrictive Covenants | Outlines activities, like working for a competitor, that the employee is prohibited from undertaking after termination. |
| Terms of Service (ToS) | Acceptable Use Policy | Lists behaviors or content uploads prohibited by the platform's rules to maintain service integrity. |
| Operating Agreement | Restrictions on Transfer | Specifies who is prohibited from selling or transferring ownership interest in the company. |
Contract language
Common contract wording
| Contract wording | Plain-English meaning | What to check |
|---|---|---|
| The Licensee shall not, under any circumstances, reverse engineer the software. | You are strictly forbidden from trying to figure out how our program works by taking it apart. | Confirm if this prohibition is reasonable and necessary for IP protection. |
| The parties agree that any use outside the scope of this agreement is prohibited. | You cannot use this material or service for any purpose not specifically listed here. | Ensure the 'scope' definition is detailed and covers all potential uses. |
| Any solicitation of customers during the term shall be prohibited. | During the contract period, you cannot try to poach our clients or encourage them to leave us. | Verify if this is a reasonable restriction in time and geographic scope. |
Red flags
Red flags to watch for
shall not engage in any activity that could be construed as...
This phrasing is vague and overbroad, giving the other party excessive power to restrict your actions.
What to check: Demand specific examples or measurable criteria instead of general descriptions.
The parties reserve all rights against any unauthorized use.
It lacks a clear definition of 'unauthorized' and could be interpreted to cover legitimate uses.
What to check: Require an explicit list of permitted uses alongside the prohibitions.
This prohibition shall survive termination indefinitely.
Indefinite restrictions (especially non-competes) are often viewed by courts as unenforceable due to public policy concerns.
What to check: Limit the duration and geographic scope of any surviving restriction to a reasonable period.
subject to applicable law, but not limited to...
This phrase implies that the list is incomplete, allowing them to enforce unwritten rules.
What to check: Seek language that clearly defines what *is* allowed, rather than listing what is forbidden.
Wording examples
Clearer wording examples
Vague wording
Prohibited use of our trademarks.
Clearer wording
Use of the trademark 'XYZ' outside of marketing materials related to Product Alpha is prohibited.
Vague wording
Cannot compete with us.
Clearer wording
For a period of 12 months following termination, you are prohibited from working within a 50-mile radius in the manufacturing of Widgets A and B.
Note: “clearer” means easier to read — not legally reviewed or guaranteed safe.
Pre-signature checklist
What to check before signing
1
Verify the source: Is this prohibition statutory (law) or purely contractual?
2
Confirm the scope: Does it restrict only necessary actions, or is it overly broad?
3
Check duration: Are there reasonable time limits on any continuing prohibitions?
4
Review enforcement mechanisms: What specific remedies are available if the rule is broken?
5
Identify carve-outs: Are there exceptions for permissible activities that contradict a prohibition?
Party impact
How prohibited affects each party
| Party | What this party should check |
|---|---|
| Employee | Ensure non-compete clauses are narrowly tailored to protect genuine business interests, not just prevent competition. |
| Buyer | Verify that any prohibitions on inspection or use do not violate consumer rights or statutory warranties. |
| Service Provider | Examine data handling restrictions to ensure compliance with all relevant privacy laws (e.g., state and federal regulations). |
Comparison
prohibited vs similar terms
| Related term | Plain meaning | Main difference from prohibited |
|---|---|---|
| Restricted | Limited or placed under specific conditions. | A restriction suggests a permissible scope, while prohibited means the action is forbidden altogether. |
| Prohibited | Explicitly forbidden by law, contract, or regulation. | It denotes an absolute barrier; it leaves no room for interpretation or exceptions. |
| Limited | Allowed, but only to a certain degree or in specific ways. | A limitation allows some activity while prohibiting others. 'Prohibited' bans the activity entirely. |
Missing or vague
If prohibited is missing or vague
If the term is vague, disputes often arise over what constitutes a breach of conduct.
Ambiguity forces parties into costly litigation simply to interpret the intent behind the clause.
A court must then decide whether the restriction was reasonable or an unconscionable attempt to stifle competition.
Always seek definitions that are objective and measurable rather than subjective concepts like 'good faith' or 'general misconduct.'
Document map
Document section map
| Contract section | What to inspect |
|---|---|
| Definitions | Look for how the term defines its source (e.g., 'prohibited means solely under federal law'). |
| Representations and Warranties | Check if either party represents they are not violating any existing laws or prohibitions. |
| Indemnification | See if the contract requires one party to indemnify the other against penalties resulting from prohibited acts. |
Visual model
Understand prohibited fast
An explainer image has not been generated for this term yet.
01
Franchisor | Prohibits franchisee from selling products outside the established territory | Leads to breach of covenant litigation.
02
Landlord | Prohibits tenants from subletting without written consent | Renders any unauthorized sublease agreement voidable.
03
Bank | Prohibits collateral transfer to a third party without notice | Allows the lender to claim default and accelerate the loan.
Questions & answers
Common questions about prohibited
What does prohibited mean?
Prohibited usually means conduct that is explicitly forbidden by law, contract, or regulation. In contracts, it establishes clear boundaries on permissible actions, risking material breach remedies like injunctions. Before signing, verify the source and scope of the restriction—is it statutory, contractual, or regulatory?
What is prohibited in plain English?
A prohibited action is like getting permission to play with only certain toys; you cannot touch anything else. If you break that rule, you might get a time-out until you learn better behavior.
Why does prohibited matter in a contract?
Ignoring a prohibition usually constitutes a material breach, giving the injured party the right to seek damages or void the contract. The breaching party bears the risk of financial loss and litigation.
When does prohibited apply?
A prohibition takes effect immediately upon execution of an agreement containing restrictive covenants, or when a new statute is officially published and enforced.
Where does prohibited appear in documents?
Non-compete clauses appear in employment agreements; regulatory limits are found in administrative rules (e.g., EPA regulations); security restrictions live in loan documents.
Who is affected by prohibited?
Lessor | Controls what the tenant can modify or use on the property. Employee | Limits activities outside of work hours. Borrower | Restricts collateral disposal without lender consent.
How does prohibited work?
First, a contract must clearly identify the specific activity that is restricted or banned. Then, the prohibition must be reasonable in scope and duration to be enforceable by a court. Finally, any attempt to perform the prohibited action exposes the party to immediate legal challenge.
What happens if prohibited is missing or vague?
If the term is vague, disputes often arise over what constitutes a breach of conduct. Ambiguity forces parties into costly litigation simply to interpret the intent behind the clause. A court must then decide whether the restriction was reasonable or an unconscionable attempt to stifle competition. Always seek definitions that are objective and measurable rather than subjective concepts like 'good faith' or 'general misconduct.'
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Wikipedia
Woomera Prohibited Area
Woomera Prohibited Area (WPA) is a prohibited area in central South Australia, with its south-eastern corner located approximately 450 kilometres (280 mi) north north-west of Adelaide. The Woomera Prohibited Area has an area of 127,000 square kilometres...
Open on Wikipedia →Knowledge graph
Where prohibited connects to real contract work
This layer links the term to nearby glossary entries, document use cases, and contract-risk guides so readers can move from definition to context without dead ends.
9nodes
Glossaryloan documentsloan documents often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause ar...Glossarymaterial breachmaterial breach often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause a...Glossaryagreementagreement often shapes similar contract language wording, negotiation leverage, and the plain-English meaning of the clause around...
BGRisk context hubGlossary meaning, document paths, and adjacent risk pages connected around this clause.
Use caseEmployment ContractHR & Recruitment: Your employment contract is longer than your offer letter — and far more binding.Use caseNon-Compete AgreementHR & Recruitment: A non-compete can lock you out of your industry for years — if you sign blindly.Use caseNDALegal & Corporate: Signing an NDA is easy. Understanding what you just agreed never to say is harder.RiskLate payment penalties contractPlain-English risk guide for late payment penalties contract.RiskPenalty for breach clausePlain-English risk guide for penalty for breach clause.RiskFreelancer indemnity clause riskPlain-English risk guide for freelancer indemnity clause risk.
Source & disclosure
This page is an AI-assisted plain-English explanation based on LexPredict Legal Dictionary context and contract-review patterns. It is not legal advice. Meaning may vary by jurisdiction, industry, and exact clause wording.
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Related Guides & Resources
Form
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