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Cite as: [1993] IECA 192

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Veritate Ltd/ AIB plc. [1993] IECA 192 (3rd December, 1993)

Notification No. CA/434/92E - Veritate Ltd/Allied Irish Banks Plc.

Decision No: 192.

Introduction

1. Notification was made by Allied Irish Banks plc on 30 September, l992 with a request for a certificate under Section 4(4) of the Competition Act, l991 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 Veritate Ltd and Allied Irish Banks Plc.

The Facts

(a) Subject of the notification

2. The notification concerns the lease of a unit for an A.T.M. facility in the Portmarnock Shopping Arcade, Strand Road, Portmarnock, Co. Dublin between Veritate Ltd as landlord and Allied Irish Banks Plc the tenant.

(b) The parties involved

3. Veritate Ltd is the owner and landlord of the Portmarnock Shopping Arcade. Allied Irish Banks plc is the largest commercial bank in Ireland with a wide branch network throughout the State. It also operates 263 Automatic Teller Machines (ATM's) including 28 at non branch locations. ATM facilities can also be used by account holders of other major banks.

(c) The notified arrangements

4. The notified lease was made on 6 May, l99l for a period of 35 years from l May, l99l. The restricted user clauses in the lease are as follows:

(a) Under clause 2 (e) the tenant covenants with the landlord "The Tenant shall use or occupy the demised premises or permit the same to be used or occupied for the purpose of the installation operation and maintenance thereon and therein of an Automatic Bank Teller machine for use in connection with the Tenant's business as Bankers and shall not permit the demised premises to be used for any other purpose or in any manner inconsistent with such user or occupation."

(b) Under clause 5 the landlord covenants "The tenant shall throughout the term hereby granted have exclusive rights to carry on the business of Banking in Portmarnock Shopping Arcade, Strand Road, Portmarnock, Co. Dublin."

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 Allied Irish Banks Plc and Veritate 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 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, l993 in respect of shopping centre leases (Iris Oifigiuil of l0 September, l993, pp. 665-667). The Authority therefore considers that the notified agreement between Allied Irish Banks Plc and Veritate Ltd 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 Allied Irish Banks Plc and Veritate Ltd in relation to the lease of the premises at Portmarnock Shopping Arcade, Portmarnock, Co. Dublin, notified under Section 7 on 30 September, l992 (notification no. CA/434/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

3 December 1993