Irish Competition Authority Decisions

1. Notification was made by James Paul Murray and Erica Anne Murray (the Murrays) 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 a lease between Rathmines Properties Ltd and the Murrays.

2. The notification concerns the lease of unit 6A in the Swan Centre, Rathmines, Dublin 6 between Rathmines Property Ltd as landlord and the Murrays as tenant.

3. The Murrays, trading as The Hopsack, are engaged in the business of retail of health foods, herbal remedies, home brew and home winemaking materials at the Swan Centre. Rathmines Properties Ltd is the landlord and owner of the Swan Centre.

4. The notified lease was made on 29 August, l984 for a period of 35 years from l January, l984. The restricted user clauses in the lease are as follows:

(a) Under clause 4.25 the tenant covenants with the landlord:

"Not to assign transfer or underlet or part with the possession or occupation of the Demised Unit or any part thereof or suffer any person to occupy the Demised Unit or any part thereof as a licensee or as concessionaire but so that not withstanding the foregoing the Landlord shall subject to Sub-clause 7.4 hereof not unreasonably withhold its consent.."

(b) Under clause 4.26.1 the tenant covenants with the landlord:

"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......Provided Always ...."

(c) Part II of the First Schedule defines the Permitted User as

"Sale of health foods and materials for home brew and home winemaking, natural cosmetics, vitamins and mineral supplements and herbal remedies."

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

5. Under a supplementary letter to an Agreement dated l8 November, l983 which was also notified the Landlord undertakes

(1) Not to let any other Unit in the Centre for use for the sale of Home-brew, home-winemaking materials, health foods and herbal remedies.

(2) To ensure that no tenant at first instance uses his premises for the sale of any of the items specified at paragraph No 1 above.

6. The Authority considers that the Murrays and Rathmines Properties Limited are undertakings and that the notified lease is an agreement between undertakings. The agreement has effect within the State.

7. 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 Rathmines Properties Limited and the Murrays 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 agreement between Rathmines Properties Limited and James Paul Murray and Erica Anne Murray in relation to the lease of the premises at the Swan Centre, Rathmines, Dublin 6 notified under Section 7 on 30 September 1992 (notification no.CA/732/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

13 October 1993