Glossary
Assignment clause
Short answer
An assignment clause governs whether a party may transfer its rights or obligations under a contract to a third party. Many clauses require the other party's consent, sometimes not to be unreasonably withheld, and may carve out transfers to affiliates or successors in a merger or sale of the business.
By Pactinel editorial teamReviewed on October 22, 2026
Assignment moves the contract from one party to another. Without a clause, default law applies, and it varies by country and by type of right. Most commercial contracts therefore address the point expressly.
Common positions
| Position | Effect |
|---|---|
| Free assignment | Either party may assign without consent |
| Consent required | Assignment needs written consent |
| Consent not unreasonably withheld | The other party cannot refuse without good reason |
| Carve-outs | Affiliates and successors in a merger or sale of business allowed |
| Prohibition | No assignment at all |
Example clause
"Neither party may assign this Agreement without the prior written consent of the other, except to an affiliate or to a successor to all or substantially all of its business, on written notice."
Practical points
- Check whether a merger or asset sale is treated as an assignment.
- Check whether notice is needed even where consent is not.
- Note that assigning rights is not the same as transferring duties, and the original party may stay liable.
- Assignment of payment rights, such as to a lender or factor, may be treated separately.
Consider this clause together with change of control. A deal that avoids one may still trigger the other. See also amendment for formal changes.
This is general information, not legal advice.