Irish Competition Authority Decisions

1. Notification was made by Riga Limited on 30 September, 1992 with a request for a certificate under Section 4(4) of the Competition Act, 1991 or, in the event of a refusal by the Competition Authority to issue a certificate, a licence under Section 4(2), in respect of leases between Riga Limited and the tenants of Paul Street Shopping Centre, Cork.

2. The notification concerns the lease of shop units in Paul Street Shopping Centre, Paul St, Cork between Riga Limited as landlord and 18 tenants of shop units in the Centre.

3. Riga Ltd is the owner and landlord of the Paul St Shopping Centre. The tenants are engaged in various retail and service activities at the shopping centre.

4. The standard shopping centre leases notified contain the following restricted user clauses viz.

(a) Under clause 4.23 the tenant covenants "Not without the prior consent in writing of the Landlord.....to use or permit or suffer or allow the Demised Unit or any part or parts thereof to be used for any purpose other than as set forth in Part II of the First Schedule hereto......."

(b) Under clause 4.24.2 the tenant covenants "Not at any time to use the Premises or any part thereof or allow the same to be used as a butcher shop or a greengrocers shop".

(d) Under clause 4.22 the tenant covenants "Not to assign, transfer, underlet, share or part with the possession or occupation of the Premises or any part thereof or suffer any person to occupy the Premises or any part thereof as a licensee or as concessionaire and in no circumstances or event to an assignee who would carry on any business of a non-retail nature BUT SO THAT NOTWITHSTANDING the foregoing the Landlord shall not unreasonably withhold its consent to an assignment transfer or underletting of the entire of the Premises or to the suffering of any person to occupy the entire of the Premises as a licensee or concessionaire in any case in which the following provisions or such of them as may be appropriate are complied with ......."

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

5. The standard lease also notified in respect of the older tenancies contains similar provisions. Riga Ltd has supplied details of the permitted user under clause 3.23 attaching to each tenancy whereby each tenant is restricted to particular specified trading or service activities with the Supermarket unit being granted exclusive user as a greengrocers/butchers shop.

6. The Authority considers that Riga Limited and the tenants of Paul Street 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 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 Riga Limited and the tenants of Paul Street 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 Riga Limited and the tenants of Paul Street Shopping Centre in relation to the lease of premises in Paul Street Shopping Centre, Paul St, Cork, notified under Section 7 on 30 September 1992 (notification no. CA/221/92E), do not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

15 December 1993