Irish Competition Authority Decisions

1. Notification was made by Allied Irish Banks plc (AIB) 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 Douglas Developments Ltd and AIB.

2. The notification concerns the lease of a site for an Automatic Teller Machine (ATM) at Douglas Court Shopping Centre, Douglas, Co. Cork between Douglas Developments Ltd as landlord and AIB as tenant.

3. Douglas Developments Ltd is the lessor of shop units at Douglas Court Shopping Centre. AIB is the largest commercial bank in Ireland with a wide branch network throughout the State. It also operates 263 ATMs including 28 at non branch locations. These facilities can also be used by account holders of other major banks.

4. The draft agreement notified is supplemental to the lease which was executed in 1990 between Douglas Developments and AIB. The restricted user clauses in this draft agreement are as follows:-

(a) Under clause 6 it is agreed that

"AIB will have the exclusive right to carry on the business of banking (the expression "the business of banking shall include the business of Mortgage Broker, Building Society, Savings Bank, Thrift Company, Credit Union, Friendly Society and Money Lender) for the first 3 years of their occupancy in Phase 1 of the centre."

(b) Under clause 7 it is agreed that

"in the event of AIB relocating to Phase 2 of the centre Douglas agrees not to let any unit or space to another Bank or financial institution of any kind in Phase 1 for the purpose of carrying on the business of banking - the only exception being in the case of some new technology unit for a type not presently used for carrying on the business of banking (not including an A.T.M. machine/lobby) and in this case A.I.B. will be offered first refusal at a market rent."

(c) Under clause 8 it is agreed that

"in the event of A.I.B. not relocating to Phase 2 of the centre and remaining in Phase 1 of the centre, Douglas agrees not to let any unit or space in Phase 1 of the centre to any other financial/institutional type tenant of any kind for the purpose of carrying on the business of banking without AIB having been offered first refusal of that unit or space at a market rent."

5. The Authority considers that Douglas Developments Ltd and AIB are undertakings and that the notified agreement 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 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 Douglas Developments and Allied Irish Banks plc 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 Douglas Developments Ltd and Allied Irish Banks plc in relation to the lease of the premises at Douglas Court Shopping Centre, Douglas, Co. Cork notified under Section 7 on 30 September 1992 (notification no. CA/437/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

5 October 1993