Irish Competition Authority Decisions

1. Notification was made by Mary, Thomas and P.J. McGrath (the McGraths) 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 the McGraths and the tenants of units at Kilbarrack Shopping Centre, Kilbarrack, Dublin 13.

2. The notification concerns the leases of shop units at Kilbarrack Shopping Centre, between the McGraths as Landlord and 22 separate tenants.

3. The McGraths are involved in the business of letting shop units at Kilbarrack Shopping Centre. The tenants are involved in various retail and service activities at the shopping centre.

4. The sample shopping centre lease notified related to Unit 28 and was executed on 21 September 1988 for a term of 30 years from 1 June 1988 between Calvinia Ltd as the lessor and Doc Holliday (Ireland) Ltd/Colm Bennett as lessee. The restricted user clauses in this lease are as follows:-

(a) Under clause B.12 of the tenant covenants

"Not to .... use or permit the (Demised Premises) to be used for any other purpose other than as a Restaurant/Takeaway as a specific user and no other purpose whatsoever".

(b) Under clause B.30 the tenant covenants

"(a) Not to assign, underlet or part with or share the possession of any part of the Demised premises under any circumstances whatsoever...

(b) Not to assign, underlet or part with or share the possession of the whole of the demised premises except to a suitable and solvent Lessee and subject to the written consent of the Lessor and only on the ....."

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

5. The McGraths have indicated that similar restrictions attach to each of the other tenancies with the permitted User clause 12 confining each tenant to particular specified trading activities.

6. The Authority considers that the McGraths and the tenants 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 and exclusive 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 the McGraths and the tenants do not offend against Section 4 (1) of the Competition Act 1991.

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 Mary, Thomas and P.J. McGrath and the tenants in relation to the lease of shop units at Kilbarrack Shopping Centre, Kilbarrack, Dublin 13 notified under Section 7 on 30 September 1992 (notification no. CA/1077/92E), do not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

5 October 1993