Irish Competition Authority Decisions

1. Notification was made by Noel McManus on 30 September 1992 with a request for a certificate under Section 4(4) of the Competition Act, 1991, or in the event of a refusal by the Competition Authority to issue a certificate, a licence under Section 4(2) in respect of a lease between Arch Properties Ltd and Noel McManus.

2. The notification concerns the lease of shop unit No. 18 at Swan Shopping Centre, Rathmines, Dublin 6 between Arch Properties Ltd as landlord and Noel McManus as tenant.

3. Arch Properties Ltd., as successors in title to Rathmines Properties Ltd., is engaged in the business of letting shop units at the Swan Shopping Centre. Noel McManus, trading as McManus Chemists, is involved in the business of retail pharmacy at the shopping centre.

4. The notified shopping centre lease was executed on 13 June 1984 for a term of 35 years from 1 August 1984. The restricted user clauses in the lease are as follows:

(a) Under clause 4.26.1 the tenant covenants

"Not without the prior consent in writing of the Landlord....to use or permit or suffer or allow the Demised Unit or any part or parts thereof to be used for any purpose other than as set forth in Part II of the First Schedule hereto and for no other purpose or purposes whatsoever.....

Part II of the First Schedule under the heading Permitted User reads

" Pharmaceutical Chemist and sale of cosmetics, sight testing and the supply of optical dispensing equipment, vitamin foods and accessories, toiletries, surgical and medical aids, foot care, keep-fit equipment, pictures and art work picture frames, veterinary products and cosmetic electrical goods."

(b) Under clause 4.25 the tenant covenants

"not to assign, transfer or underlet or part with the possession or occupation the Demised unit or any part thereof ....BUT SO THAT NOTWITHSTANDING the foregoing the Landlord shall.... not unreasonably withhold its consent.....

(c) The applicant has also indicated that confirmation had been received by way of side letter from the landlord that he would be the sole Chemist/Pharmacist in the Centre.

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

5. The Authority considers that Arch Properties Ltd and Noel McManus are undertakings and that the notified lease is an agreement between undertakings. The agreement has effect within the State.

6. The Authority considers that the notified agreement, and its restricted and exclusive user clauses and the other standard restrictive clauses and obligations, does 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 Arch Properties Ltd and Noel McManus does not offend against Section 4 (1) of the Competition Act 1991.

7. 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 agreement between Arch Properties Ltd and Noel McManus in relation to the lease of the premises at Unit 18 Swan Shopping Centre, Rathmines, Dublin 6 notified under Section 7 on 30 September 1992 (notification no. CA/1094/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

13 October 1993