Irish Competition Authority Decisions

1. Notification was made by Power Supermarkets Ltd (Powers) on 30 September l992 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 Dungoyne Ltd and Powers.

2. The notification concerns the lease of the supermarket area at Laois Shopping Centre, Portlaoise between Dungoyne Ltd as landlord and Powers as tenant.

3. Dungoyne Ltd is the Landlord of premises in Laois Shopping Centre. Powers trades as a Supermarket with several outlets in the State.

4. The notified shopping centre lease was executed on 6 August, l99l for a period of 999 years from 1 November, l990. The restricted user clauses in the lease are as follows:

(a) Under clause 4(20)(b) the tenant covenants with the landlord "......not to use the whole or any part of the property for any business other than the permitted use without the previous consent in writing of the Landlord...."

(b) Clause 1(10) defines "Permitted Use - As a supermarket including the sale of intoxicating liquor for consumption off the property or a supermarket and retail discount store including the sale of intoxicating liquor for consumption off the property"

(c) Under clause 5(10)(a) the landlord covenants with the tenant "Not to sell or permit the sale directly or indirectly by any tenant subtenants ......of or in the Centre ..... of any foodstuffs in or from any unit or area exceeding 1,500 square feet or of any intoxicating Liquor for consumption off the premises in or from any area of any size PROVIDED that this covenant shall not apply to sales of food stuffs by any cafe, restaurant, take-away shop..... or to sales of intoxicating liquor for consumption off the premises by a single public house in the Centre ....

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

5. The Authority considers that Powers and Dungoyne Ltd 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 Dungoyne Ltd and Powers 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 agreement between Dungoyne Ltd and Power Supermarkets Limited, in relation to the lease of a premises in Laois Shopping Centre, Portlaoise, notified under Section 7 on 30 September 1992 (notification no. CA/615/92E), does not offend against Section 4 (1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

5 October 1993