Irish Competition Authority Decisions

1. Notification was made by Albafare 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 Albafare and Hubert O' Doherty.

2. The notification concerns the lease of a premises in Dundrum Shopping Centre, Sandyford Road, Dundrum, Dublin 14 between Albafare, the landlord and Hubert O' Doherty, the tenant.

3. Albafare is engaged in the letting of shop units at Dundrum Shopping Centre. Hubert O'Doherty trades as a retail pharmacy at Dundrum Shopping Centre.

4. The notified shopping centre lease was made on 30 October 1987 for a period of 35 years from 29 September 1984. The restricted user clauses in the lease are as follows:

(a) Under Clause 4.25 the tenant covenants with the landlord

"Not to assign transfer or underlet or part with the possession or occupation of the Demised Unit or any part thereof ......"

(b) Clause 4.25.9 reads

" Where the proposed assignee sub-lessee....may in the reasonable contemplation of the Landlord be in the process of acquiring ...in the aggregate more than 2,000 square feet IT IS HEREBY AGREED that no holding ..... in excess of 2,000 square feet without the express consent in writing of the Landlord shall be a lawful holding......

(c) Under Clause 4.26.1 the tenant further covenants with the landlord

"Not without the prior consent in writing of the Landlord or its agent thereunto lawfully authorised to use or to permit or suffer or allow the Demised Unit or any part or parts therof to be used for any purpose other than as set forth in Part II of the First Schedule hereunto ....... "

Part II of the First Schedule reads under the heading permitted user

" As a Dispensing Chemist to be used for the purpose of carrying on the business of a Dispensing Chemist but not for food retailing nor as an Off-Licence premises".

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

5. The Authority considers that Albafare and Hubert O' Doherty, 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 Albafare and Hubert O' Doherty, 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 Albafare and Hubert O' Doherty, in relation to the lease of a premises at Dundrum Shopping Centre, Sandyford Road, Dundrum, notified under Section 7 on 30 September 1992 (notification no. CA/612/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall

Member

13 October 1993