Irish Competition Authority Decisions

1. Notification was made by Wilhelmina McCormack 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 lease between Max Developments Ltd and Wilhelmina Mc Cormack.

2. The notification concerns the lease of a shop unit, Unit 21, at Donaghmede Shopping Centre, Donaghmede, Dublin 13 between Max Developments Ltd as landlord and Wilhelmina Mc Cormack as tenant.

3. Max Developments Ltd the present Landlord is engaged in the letting of shop units at Donaghmede Shopping Centre. Wilhelmina Mc Cormack who now holds the tenancy interest in unit 21 is engaged in the business of hairdressing at Donaghmede Shopping Centre.

4. The notified shopping centre lease was executed on 7 June 1973 for a period of 35 years from 1 April 1973. The restricted user clauses in the lease are as follows:

(a) Under clause c(12) of the agreement the tenant covenants

"To use the demised premises only for the carrying on of the trade, provision of services or sale by retail of the goods set out in the Fourth Schedule hereto and not without the Landlord's consent in writing to use or permit to suffer the same or any part thereof to be used for the carrying on of any other trade, provision of any other service or the sale of any other goods or for any other purpose whatever....."

The Fourth Schedule under the heading "Limitation of user clause" reads

"The premises are to be used as a Male and Female Hairdressers shop only."

(b) Under clause c(14)(a) the tenant covenants with the landlord

"Not to assign, sublet, part with or share possession or occupation of the demised premises or any part thereof or suffer any person to occupy or use the demised premises or any part thereof as licensee without the consent in writing of the Landlord being first obtained........

(c) Under clause 6 of the First Part of the Second Schedule to the Lease the Landlord undertakes

"not to demise any other male or female hairdressing shop unit in the Donaghmede Town Centre during the currency of this lease for so long as Unit 21 is continuously used as a Hairdressers shop only....."

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

5. The Authority considers that Max Developments Ltd and Wilhelmina Mc Cormack 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 1993 in respect of shopping centre leases (Iris Oifigiuil 10 September 1993, pp. 665-667). The Authority therefore considers that the notified agreement between Max Developments Ltd and Wilhelmina McCormack does not offend against Section 4 (1) of the Competition Act 1991.

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 Max Developments Ltd and Wilhelmina Mc Cormack in relation to the lease of the premises at Unit 21, Donaghmede Shopping Centre, Donaghmede, Dublin 13 notified under Section 7 on 30 September 1992 (notification no. CA/207/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

5 October 1993.