Irish Competition Authority Decisions

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Cite as: [1993] IECA 190

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Michael Kavanagh/D Horkan Ltd [1993] IECA 190 (3rd December, 1993)

Notification No CA/815/92E - Michael Kavanagh/D.Horkan Ltd

Decision No. 190.

Introduction

1. Notification was made by D. Horkan Limited 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 Michael Kavanagh and D.Horkan Ltd.

The Facts

(a) The subject of the notification

2. The notification concerns the lease of Unit 1, Orwell Shopping Centre, Templeogue, Dublin 6 between Michael Kavanagh as Landlord and D. Horkan Ltd as tenant.

The parties involved

3. Michael Kavanagh is stated to be the landlord of shop units at Orwell Shopping Centre. D. Horkan Limited, which acquired the leasehold interest in 1992, trades as a newsagency under the name "Newsextra" at the centre.

The notified arrangements

4. The notified shopping centre lease was made on 20 June 1975 between Viscount Securities Ltd as landlord and Duffy Group Ltd as tenant, for a term of 35 years. The restricted user clauses in the lease are as follows:

(a) Under clause 4.11 the tenant covenants "Not at any time to permit or allow the consumption of or sale of food on the demised premises."

(b) Under Clause 4.12 of the lease the tenant covenants "To use the demised premises for the purpose of the business of Newsagent, Confectioner and Tobacconist only and not without the Landlord's consent in writing which may not be unreasonably withheld to use or permit or suffer the same to be used for any other purpose."

(c) Under clause 4.14 the tenant covenants "Not to assign sub-let part with or share possession of the demised premises or any part thereof without the consent in writing of the Landlord (such consent not to be witheld) AND provided ........"

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 D. Horkan Limited and Michael Kavanagh 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 Michael Kavanagh and D. Horkan 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 Michael Kavanagh and D. Horkan Limited (trading as Newsextra) in relation to the lease of the premises at Orwell Shopping Centre, Templeogue, Dublin 6 notified under Section 7 on 30 September 1992 (notification no. CA/815/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

3 December 1993