What is an anti-assignment provision?

What is an anti-assignment provision?

The goal of an “anti-assignment” provision is to ensure that the two contracting parties will not be able to transfer their obligations under the agreement to someone else without first getting permission from the other party. One of the boilerplate clauses found in  most commercial contracts looks something like “Neither this Agreement nor any of the rights, interests or obligations under the Agreement shall be assigned, in whole or in part, by operation of law or otherwise by either party without the prior written consent of the other party.”

There are three variations of anti-assignment clauses that can be used in a contract: a standard anti-assignment clause barring any assignment or delegation, the second one is used when the parties want to prohibit assignments except if they transfer the agreement to new owners or affiliate companies (and don’t want to ask for permission), and the third type is similar to the second one except it requires permission for such an assignment. But it should be noted that only prevent “voluntary” assignments van be prevented; you cannot prevent assignments that are ordered by a court or that are mandatory under law—for example in a bankruptcy proceeding.
What is an anti-assignment provision? What is an anti-assignment provision? Reviewed by Kelly Miller on June 13, 2016 Rating: 5

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