When selling a business, it is reasonable to include in the sale agreement a restrictive covenant. This prevents the seller from starting a new business in direct competition with the buyer of the seller's previous making use of the goodwill sold with the business.
That is making use of the contacts the seller has built up as a result of operating the sold business.

A restrictive covenant will only be enforceable if it is no wider than reasonably necessary to protect legitimate proprietary interests (that is trade secrets and trade connections). When drafting restrictive covenants, in order to maximise the likelihood that they will be enforceable, it is therefore necessary to understand the interests that are to be protected, and what will be the minimum level of protection that will be needed.

The important distinction, which needs to be well understood, is the distinction between protecting your business simply against competition (which you cannot do), and protecting a legitimate interest which can be said, in a loose sense, to be your property - for example, goodwill, trade connection or confidential information. A legitimate interest may be protected so long as certain tests are met..

In Newman Ltd v Adlem (2005), the Court of Appeal held that there was a duty on the seller of a business not to undermine the goodwill attached to that business (if included in the sale) even after the non-competition covenants in the sale agreement had expired. Goodwill is an intangible asset valued according to the advantage or reputation a business has acquired.
The Court held that:

• once the defendant had assigned the goodwill in the funeral business, it was not open to him to start, after the expiry of the restrictive covenant, a fresh business under exactly the same name;
• having sold the goodwill, Mr Adlem was under a duty not to undermine it;