Irish Competition Authority Decisions

1. Notification was made by Friends Provident Life Assurance Company Limited 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 standard lease between Friends Provident Life Assurance Company Limited and tenants of Friends Provident Centre.

2. The notification concerns the standard lease relating to the shop units in the Friends Provident Centre, Dawson St., Dublin 1 between Friends Provident and the tenants of the centre.

3. Friends Provident is engaged in the business of Assurance and the management of funds and is the owner and landlord of the Friends Provident Centre. The tenants are engaged in various trading activities at the centre.

4. The notified lease is a standard lease in draft form. The restricted user clauses in the draft lease are as follows:

(a) Clause 1(9) of the lease defines the permitted use:

"For the retail sale of ........"

(b) Under clause 4(12) the tenant covenants with the landlord

"Not to transfer assign underlet mortgage charge hold in trust for another part with nor share possession or control or occupation of the Property or any part thereof save and except as is permitted ......"

(c) Under clause 4(21)(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 which consent shall not be unreasonably withheld ...."

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

5. The applicants have also advised that an exclusive user provision has been granted by way of side letter from the Landlord in relation to unit 26 in the following terms:-

" 2. We undertake that on the grant of a first lease of any of the units in the Centre during the period of 20 years commencing on the 25th day of August, 1991"the Relevant Period") the Permitted Use in such a lease shall not authorise the tenant thereof to carry on the Restricted Permitted Use.

3. We undertake that we will not willingly during the Relevant Period consent to a change in the Permitted Use in any lease of any Unit in the Centre which would authorise the tenant thereof to use any such Unit for the Restricted Permitted Use."

6. The Authority considers that Friends Provident Life Assurance Company Limited and the tenants are undertakings and that the notified leases are agreements between undertakings. The agreements have effect within the State.

7. The Authority considers that the notified agreements, and their restricted and exclusive user clauses and the other standard restrictive clauses and obligations, do 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 agreements between Friends Provident Life Assurance Company Limited and the tenants do not offend against section 4(1) of the Competition Act, l99l.

8. 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 agreements between Friends Provident Life Assurance Company Limited and the tenants in relation to the lease of premises at Friends Provident Centre, Dawson St, Dublin 1 notified under Section 7 on 30 September 1992 (notification no. CA/1101/92E), do not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall

Member

13 October 1993