Irish Competition Authority Decisions

1. Notification was made by Killiney Management Shopping Centre Limited (Killiney Management) 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 Authority to issue a certificate a licence under Section 4(2), in respect of leases between Killiney Shopping Centre Management Company Limited and the tenants in Killiney Shopping Centre.

2. The notification concerns the leases of shop units in Killiney Shopping Centre, Rochestown Ave., Killiney, Co. Dublin between Killiney Shopping Centre Management Company Limited as lessor and the tenants of 14 shop units in the centre.

3. Killiney Shopping Centre Management Company Limited, which is owned by the tenants is the owner and landlord of Killiney Shopping Centre. The tenants are engaged in various retail and service activities at the centre.

4. Each tenancy is subject to a lease for a term of 999 years from 1989. These leases replace earlier leases granted by the previous landlord but contain similar terms and conditions (apart from the period of the lease and rent payable). The standard lease notified contains the following restricted user clauses viz.

(a) Under clause 2.7.2 the lessee covenants "....not to use or suffer to be used the demised premises or any part thereof for any purpose other than without the consent of the Lessor under its seal first obtained. PROVIDED ALWAYS that the Lessor shall not permit any other unit in the Shopping Centre to be occupied by "

(b) Under clause 3.3 the lessor covenants "Not to lease or alienate any part of the ....Shopping Centre without first reserving thereout for the benefit of the Lessee rights and privileges corresponding to and reciprocal to those accepted and reserved in favour of the Lessor and others out of these presents......"

(c) Under clause 2.16.1 the Lessee covenants " Not to assign or underlet or part with possession of the demised premises or any part thereof......without the previous written consent of the Lessor such consent not to be unreasonably witheld."

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

5. Killiney Management has supplied details of the permitted user and exclusive user attaching to each tenancy whereby each tenant is restricted to particular specified trading activities and granted exclusivity in respect of them at the shopping centre.

6. The Authority considers that Killiney Shopping Centres Management Company Ltd and the tenants of Killiney Shopping Centre are undertakings and that the notified leases are agreements between undertakings. The agreements have effect within the State.

7. The Authority considers that the notified agreements, and their restricted and exclusive user clauses and the other standard restrictive clauses and obligations, do 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 agreements between Killiney Shopping Centre Management Company Limited and the tenants of Killiney Shopping Centre do 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 agreements between Killiney Shopping Centre Management Company Limited and the tenants of Killiney Shopping Centre in relation to the lease of premises at Killiney Shopping Centre, Killiney, Dublin notified under Section 7 on 30 September 1992 (notification no. CA/1104/92E), do not offend against Section 4 (1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

3 December 1993