Irish Competition Authority Decisions

1. Notification was made by Asha Clothing Limited 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 Asha Clothing Limited and Firmount Limited.

2. The notification concerns the lease of shop unit numbers 212/213 at St. Stephen's Green Centre, Dublin 2 between Firmount Ltd as Landlord and Asha Clothing Ltd as tenant.

3. Firmount Limited is engaged in the letting of shop units at St. Stephen’s Green Centre. Asha Clothing Ltd trades as a retailer of fashion clothing, particularly leather fashions.

4. The notified lease was made on 21 August, 1991 for a period of 35 years from 1 July, 1991. The restricted user clauses in the lease are as follows:

(a) Under clause 4.11.2 the tenant covenants with the Landlord

"Not without the prior consent in writing of the Landlord or its Agent thereunto lawfully authorised to use or to permit or suffer or allow the Demised Premises or any part or parts thereof to be used for any purpose other than as a retail shop for the Permitted Business and for no other purpose or purposes whatsoever ........"

Clause 1 of the lease defines Permitted Business as

"The retail trade or business of the sale of fashion garments leather garments and accessories".

(b) Under clause 4.25.1 the tenant covenants with the landlord:

"Not to assign, transfer, underlet, charge, mortgage, encumber, hold on trust for another or part with the possession or occupation of the Demised Premises or any part thereof or suffer any person to occupy the Demised Premises or any part thereof as a licensee or as concessionaire But So That Notwithstanding the foregoing the Landlord shall not unreasonably withhold its consent......."

(c) By way of letter dated 22 August 1991 the Landlord stated

"In consideration of your taking a lease on Unit 212/213 and surrendering your interest in Unit 209 we hereby undertake not to let Unit 209 for a period of 5 years from 1 July 1991, to a party trading in Hippie, Punk or Heavy Metal Fashions.

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

5. The Authority considers that Asha Clothing Limited and Firmount Limited 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 Firmount Ltd and Asha Clothing Limited does not offend against section 4(1) of the Competition Act, l99l.

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 Firmount Ltd and Asha Clothing Ltd in relation to the lease of units 212/213 at St. Stephen's Green Shopping Centre, Dublin 2 notified under Section 7 on 30 September 1992 (notification no. CA/275/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

13 October 1993