Irish Competition Authority Decisions

1. Notification was made by Irish Pension Fund Property Unit Trust (IPFPUT) on 16 September 1992 and by Power Supermarkets Ltd on 30 September 1992 with requests 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 IPFPUT and Power Supermarkets Limited.

2. The notification concerns the lease of the Supermarket or anchor unit in Roselawn Shopping Centre, Blanchardstown, Co. Dublin, between IPFPUT as landlord and Power Supermarkets Limited, trading as Quinnsworth.

3. IPFPUT is a unit trust engaged in the investment in and management of commercial properties on behalf of certain self-administered pension funds, charities and exempt funds. Erin Executor & Trustee Company Ltd is trustee. Quinnsworth is the trading name of Power Supermarkets Limited which operates a chain of supermarkets throughout the State.

4. The notified shopping centre lease was made on 5 December 1977 for a period of 24 years from 24 June 1976. The restricted user clauses in the lease are as follows:

(a) Under Clause 4(20), the tenant covenants with the landlord:

"Not except with the consent in writing of the landlord (such consent not to be unreasonably withheld) but in considering and giving such consent the landlord shall be entitled to have full regard to the principles of good estate management to use or occupy the demised premises or any part thereof or permit the same to be used or occupied for any purpose other than the retail trade or business of a Supermarket and or Department Shop or Store and or retail shop or store including for the off-sale of intoxicating liquor not in any manner inconsistent with such user or occupation....."

(b) Under Clause 7(7) the Landlord covenants with the tenant:

" Not to transfer assign lease or let or permit to be transferred assigned leased or let sub-leased or sub-let or permit to be used any one or more Units or any part or parts either adjoining each other or otherwise of the Shopping Centre as retail shopping outlets with an area containing or totalling more than 2000 square feet to any person.

(c) Under clause 7(8) the Landlord covenants

"Not to sell nor permit or suffer the sale by any tenants or sub-tenants or under-tenants of groceries food or food products or hardware in any Unit (other than the licensed premises in respect of food normally sold in the course of business in any licensed premises or for consumption in any restaurant) in the Shopping Centre with a total or gross area exceeding 2750 square feet."

(d) Under Clause 4(17), the tenant covenants with the landlord, except in the case of holding companies or subsidiaries of the tenant:

(a) "..... not to assign or underlet part only of the demised premises without the licence of the landlord first obtained such licence not to be unreasonably withheld......"

(b) "....not to assign underlet or part with or share the possession control or occupation of nor to franchise the use of the whole of the demised premises without the licence in writing of the landlord first obtained which licence shall not be unreasonably withheld in the case of a respectable and responsible assignee or under-lessee.......'

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

5. The Authority considers that IPFPUT and Power Supermarkets 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 IPFPUT and Power Supermarkets Limited 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 Irish Pension Fund Property Unit Trust and Power Supermarkets Limited (trading as Quinnsworth) in relation to the lease of the premises at Roselawn Shopping Centre, Blanchardstown, Co. Dublin notified under Section 7 on 16 September 1992 (notification no. CA/78/92E) and 30 September 1992 (notification no. CA/596/92E), does not offend against Section 4(1) of the Competition Act, 1991.

For the Competition Authority.

Des Wall

Member

13 October 1993