Irish Competition Authority Decisions

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Cite as: [1993] IECA 154

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Grittar/Lite Bite/Heatons [1993] IECA 154 (3rd December, 1993)

Notification No CA/606/92E - Grittar/Light Bite/Heatons Limited

Decision No. 154

Introduction

1. Notification was made by Grittar on 30 September, l992 with a request for a certificate under Section 4(4) of the Competition Act, l99l or in the event of refusal by the Competition Authority to issue a certificate, a licence under Section 4(2), in respect of a lease between Grittar, Light Bite and Heatons Limited.

The Facts

(a) The subject of the notification

2. The notification concerns the sale by way of lease of premises at 333/337 Ballyfermot Rd, Ballyfermot, Dublin 10 between Grittar as landlord and Lite Bite and Heatons Limited as tenant.

(b) The parties involved

3. Grittar is a subsidiary of Power Supermarkets Ltd which trades as a supermarket with outlets throughout the State including Ballyfermot Shopping Centre. Light Bite is an associated company of Grittar. Heatons Limited trades as a retail draper.

The notified arrangements

4. The notified shopping centre lease was made on 5 March 1990 for a term of 450 years from 25 March 1989. The restrictive user clauses in the lease are as follows:

(a) Under clause 3 the Tenant covenants as follows viz.

"The Tenant hereby covenants with Light Bite and with the Landlord as the owner of the Supermarket in the Ballyfermot Shopping Centre Ballyfermot Road in the City of Dublin seperately with each of them but not so as to render itself personally liable for any breach of such covenant occurring after it shall have parted with all interest in the demised premises not at any time to sell or permit or suffer the sale of groceries food foodstuffs or food products in an area exceeding one thousand square feet in the demised premises and not to make any subletting or grant any licence to use or part with or share the possession of the said demised premises or any part thereof save on the basis that any such subtenant licensee or possessor shall first covenant under seal with Light Bite and with the Landlord in manner similar to this covenant."

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

Assessment - The Applicability of Section 4(1)

5. The Authority considers that Grittar, Light Bite and Heatons 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 Grittar, Light Bite and Heatons Limited does not offend against Section 4(1) of the Competition Act, l99l.

The Certificate

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 Grittar and Light Bite and Heatons Limited in relation to the lease of the premises at Ballyfermot Rd, Ballyfermot, Dublin 10 notified under Section 7 on 30 September 1992 (notification no. CA/606/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

3 December 1993