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Roches Stores Dublin Ltd [1993] IECA 37 (5th October, 1993)

COMPETITION AUTHORITY

Competition Authority Decision of 5 October 1993 relating to a proceeding under Section 4 of the Competition Act, l99l.

Notification No: CA/1016/92E - Roches Stores Dublin Limited/Peter Mark.

Decision No: 37

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Notification No CA/1016/92E -Roches Stores Dublin Limited/Peter Mark

Decision No: 37

Introduction

1. Notification was made on 30 September, l992 by Peter Mark with a request for a certificate under Section 4(4) of The Competition Act, l99l 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 Roches Stores Dublin Limited and Peter Mark.

The Facts

(a) The subject of the notification

2. The notification concerns the lease of a shop unit,Unit 1, Frascati Shopping Centre, Blackrock, Co Dublin, between Roches Stores Dublin Limited as landlord and Peter Mark as tenant.

(b) The parties involved

3. Roches Stores Dublin Limited trades as a supermarket and department store and is engaged in the letting of shop units at Frascati Shopping Centre. Peter Mark trades as a hairdresser with approximately 48 outlets in the State including the salon at Frascati Shopping Centre.

4. The notified shopping centre lease was made on 25 November 1989 for a period of 30 years from 1 September 1989. The restricted user clauses in the lease are as follows:-

(a) In clause 4.11.2 the tenant covenants with the landlord

"Not without the prior consent in writing of the Landlord or its Agency thereunto lawfully authorised to use or to permit or suffer or allow the Demised Premises or any part or parts thereof to be used for any purposes other than as a retail shop for the Permitted business and for no other purpose or purposes whatsoever .................. PROVIDED ALWAYS AND IT IS HEREBY AGREED AND DECLARED that upon any application by the Tenant or any authorised under-tenant of the Tenant for liberty to alter or change the Permitted Business the Landlord shall not unreasonably withhold its consent to such proposed change of user....."

Clause l defines "the Permitted Business" as "The retail trade or business of Ladies & Gents Hairdressing Salon, and for the sale of beauty products and for carrying out beauty treatment including sunray treatment and as a Solarium."

(b) In Clause 4.25.1 the tenant covenants with the landlord "Not to assign, transfer, underlet, ......or part with the possession or occupation of the Demised Premises or any part thereof or ........as concessionaire BUT SO THAT NOTWITHSTANDING the foregoing the Landlord shall not unreasonably withhold its consent to an assignment, transfer under-letting, charging, mortgaging or encumbering of the entire of the Demised Premises ......".

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

Peter Mark has also advised that by way of side letter the Landlord has given a commitment that no one trade would be over represented at the centre and where possible only a single shop unit in the centre would be used for a single trade.

Assessment - The Applicability of Section 4 (1)

5. The Authority considers that Roches Stores Dublin Limited and Peter Mark 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 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 Roches Stores Dublin Limited and Peter Mark, 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 Roches Stores Dublin Limited and Peter Mark in relation to the lease of a premises at Unit, 1 Frascati Shopping Centre, Blackrock, Co Dublin, notified under Section 7 on 30 September, 1992 (notification no. CA/1016/92E), does not offend against Section 4 (1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

5 October, 1993.