Irish Competition Authority Decisions

1. Notification was made by Power Supermarkets Limited (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 Navan Shopping Centre Limited and Powers.

2. The notification concerns the lease of the Quinnsworth Supermarket unit at Navan Shopping Centre, Navan, Co. Meath between Navan Shopping Centre Ltd as landlord and Powers as tenant.

3. Powers trades as a supermarket with many outlets in the State. Navan Shopping Centre Ltd is the landlord and lessor of shop units at Navan Shopping Centre.

4. The notified lease was made on 23 December, l980 for a period of l0,000 years from 29 September, l980. The restricted user clauses in the lease are as follows:

(a) Under Section III, clause 3.2(3) the tenant covenants with the landlord

"To use the demised premises for the purpose of a Department Shop or Store and/or a Retail Shop or Store and/or a supermarket including trading by way of licensing and/or franchising or making concessions and for the sale of Intoxicating Liquor whether for consumption on or off the premises and or including in the premises a Bakery, (but not for consumption on the premises of any goods prepared or sold in the said bakery) and not without the Landlord's consent in writing which shall not be unreasonably withheld to use or permit or suffer the same or any part thereof to be used for any other purpose."

(b) Under Section V, clause 5.1 the landlord covenants with the tenant

"Not to sell nor permit or suffer the sale of groceries food or food products or subject to the proviso hereinafter contained other items ... sold in a supermarket in the Republic of Ireland in an area exceeding three thousand square feet in any one unit in the Navan Shopping Centre ....."

(c) Under Section V, clause 5.2 the landlord covenants with the tenant

"Not to grant, convey, transfer, assign, lease or let or permit to be ........any one or more units or any part or parts either adjoining each other or otherwise of the Shopping Centre as a Retail Shopping outlets with an area containing or totalling more than three thousand square feet to any person and not to grant, convey, transfer, assign, lease or let any part of the Shopping Centre without obtaining a covenant..."

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

5. The Authority considers that Power Supermarkets Limited and Navan Shopping Centre Limited 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 Navan Shopping Centre Limited 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 Navan Shopping Centre Ltd and Powers Supermarkets Ltd in relation to the lease of the premises at Navan Shopping Centre, Navan, Co. Meath notified under Section 7 on 30 September 1992 (notification no. CA/589/92E), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

5 October 1993