Irish Competition Authority Decisions

1. Notification was made by Adam F. Torrie 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 a standard lease between Adam F. Torrie Limited and its tenants.

2. The notification concerns the standard lease relating to the letting of shop units at (a) L&N Shopping Centre, Davitts Quay, Dungarvan. Co. Waterford; (b) Tramore, Co. Waterford; (c) Hypermarket, Ballybricken, Waterford and (d) Wexford Town between Adam F. Torrie Limited as lessor and 11 tenants. All the units adjoin supermarkets owned by Adam Torrie Ltd at these locations.

3. Adam F. Torrie Limited is engaged in the management of supermarkets. The tenants of the shop units are engaged in various retail and service activities.

4. The standard shop lease notified contains the following restricted user clauses viz.

(a) Under clause 2(q) the tenant covenants with the landlord:

"(i) Not to assign underlet or part with the possession control or occupation of part only of the demised premises;

(ii) Not to assign underlet or part with the possession of control or occupation of the whole of the demised premises without the consent in writing of the lessor first obtained which consent shall not be unreasonably withheld....."

(b) Under clause 2(t)(i) the tenant covenants "To use the demised premises for the purpose of the business set out in the Third Schedule hereto only and not without the consent of the lessor in writing to use or permit or suffer the same or any part thereof to be used for any other purpose."

(c) Under clause 2(t)(ii)(d) the tenant covenants "Not to use the demised premises as a Supermarket or as an outlet for the sale by wholesale or retail of any of the following businesses:

(a) Butcher (including meat, poultry, fish and bacon)

(b) Delicatessen

(c) Fruit and vegetables

(d) General groceries

(e) Hot Bread shop

(f) Take-Away foods

(g) Turf Accountants"

(d) In the Third Schedule, the user is defined as "To use the demised premises for the purpose of . But subject in particular to the restrictions as set out in paragraph 2(b)(ii)(d)....."

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

5. The Authority considers that Adam F. Torrie Limited and its tenants 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 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 of 10 September, 1993, pp.665-667). The Authority therefore considers that the standard agreement notified between Adam F. Torrie Limited and its tenants does not offend against section 4(1) of the Competition Act, l99l.

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 standard agreement between Adam F. Torrie Limited and its tenants in relation to the lease of the premises at Dungarvan, Tramore, Waterford and Wexford, notified under Section 7 on 30 September 1992 (notification no. CA/627/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

15 December 1993