Irish Competition Authority Decisions

1. Notification was made by Power Supermarkets Limited on 30 September, l992 with a request for a certificate under Section 4(4) of the Competition Act, l99l, or, in the event of a refusal by the Competition Authority to issue a certificate a licence under Section 4(2), in respect of leases between Power Supermarkets Limited and the tenants of Phibsboro Shopping Centre.

2. The notification concerns the lease of shop units in Phibsboro Shopping Centre, Phibsboro, Dublin 7 between Power Supermarkets Limited as landlord and 14 tenants of the shopping centre.

3. Power Supermarkets Limited trades as a supermarket with outlets throughout the State. The tenants are engaged in various retail and service activities at Phibsboro Shopping Centre.

4. The sample shopping centre lease notified which relates to unit 1 was made on 12 September, l970 between Commercial Developments Limited as Landlord and Patrick Grace as tenant. Power Supermarkets Limited is the successor in title to Commercial Developments Limited. The restricted user clauses in the lease are as follows:-

(a) Under clause l4 the tenant covenants with the landlord

"To use the demised premises for the purpose of preparing, cooking, packing and retailing for take-away Kentucky Fried Chicken and its accompaniments, and business of a similar or allied nature and not without the Landlords consent in writing which shall not be unreasonably withheld to use or permit or suffer the same or any part thereof to be used for any other purpose."

(b) Under clause l6 the tenant covenants with the landlord

"(i) ..... not to assign transfer charge underlet or part with or share the possession or occupation of the demised premises or any part thereof ......

(ii) Not without the previous consent in writing of the Landlord not to be unreasonably withheld to assign or underlet the demised premises as a whole".

In addition, there are a number of other standard restrictive covenants and obligations in the lease.

5. Power Supermarkets have advised that similar obligations attach to each of the tenancies with permitted user clauses confining each tenant to particular specified trading or service activities.

6. The Authority considers that Power Supermarkets Limited and the tenants of Phibsboro Shopping Centre are undertakings and that the notified lease is an agreement between undertakings. The agreements have effect within the State.

7. The Authority considers that the notified agreements, and their restricted and exclusive user clauses and the other standard restrictive clauses and obligations, do not have the object or effect of preventing, restricting or distorting competition in trade in any goods or services in the State or in any part of the State, for the reasons given in the Notice of the Authority of 2 September 1993 in respect of shopping centre leases (Iris Oifigiuil 10 September 1993, pp.665-667). The Authority therefore considers that the notified agreement between Power Supermarkets Limited and the tenants of Phibsboro Shopping Centre does not offend against Section 4(1) of the Competition Act, l99l.

8. The Competition Authority has issued the following certificate:

The Competition Authority certifies that in its opinion, on the basis of the facts in its possession, the agreements between Power Supermarkets Limited and the tenants of Phibsboro Shopping Centre in relation to the lease of the units in Phibsboro Shopping Centre, Phibsboro, Dublin 7 notified under Section 7 on 30 September 1992 (notification no. CA/599/92E), do not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

13 October 1993