Irish Competition Authority Decisions

1. Notification was made by Sports Locker Ltd on 30 September 1992 with a request for a licence under Section 4(2) of the Competition Act 1991 in respect of a lease between M.P. O'Brien (Maynooth) Ltd (O'Brien) and Sports Locker Ltd.

2. The notification concerns the lease of a shop unit, Unit 5, Maynooth Shopping Centre, Maynooth, Co. Kildare between M.P.O'Brien (Maynooth) Ltd now Nabola Developments Ltd as landlord and Sports Locker Ltd as tenant.

3. The original lease was executed between M.P.O'Brien (Maynooth) Ltd as landlord and Sports Locker Ltd as tenant. It was indicated that Nabola Developments Ltd subsequently acquired the landlord's interest in the property. Nabola Developments Ltd is engaged in the business of property lessors at Maynooth Shopping Centre. Sports Locker Ltd carries on the business of retailing sports goods, bicycles etc at Unit 5 Maynooth Shopping Centre.

4. The notified shopping centre lease was executed on 16 February 1984 for a period of 30 years from 1 September 1982. The restricted user clauses in the lease are as follows:

(a) Under clause 10 section III of the agreement the tenant covenants

"To use the demised premises for the purpose of the retail sale of all sports goods bicycles and accessories and sports trophies only and not without the 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 12 section III the tenant covenants

"not to assign sublet part with or share possession of a part (as distinct from the whole) of the demised premises under any circumstances whatever or the whole of the demised premises without the prior consent in writing of the Landlord (such consent not to be unreasonably withheld).....

(c) Under clause 4, Section IV the landlord covenants

"unless the demised premises shall cease to be used for the user permitted by Clause 10 of Section 3 hereof, the landlord shall not during the demised term carry on or permit or suffer to be carried on by others in or upon any part of Maynooth Shopping Centre (including the Supermarket belonging to the Landlord) the trade or business of retail sale of bicycles other than toy bicycles, sports goods of any type, sports accessories, sports trophies or sports goods.....

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

5. The Authority considers that Nabola Developments Ltd and Sports Locker Ltd 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 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 M.P.O'Brien (Maynooth) Ltd now Nabola Developments Ltd and Sports Locker Ltd 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 M.P.O'Brien (Maynooth) Ltd, now Nabola Developments Ltd, and Sports Locker Ltd in relation to the lease of the premises at Unit 5 Maynooth Shopping Centre, Maynooth, Co. Kildare notified under Section 7 on 30 September 1992 (notification no. CA/514/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

13 October 1993