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Superquinn/Tenants of Sundrive S.C. [1993] IECA 120 (13th October, 1993)
COMPETITION
AUTHORITY
Competition
Authority Decision of 13 October 1993 relating to a proceeding under Section 4
of the Competition Act, 1991.
Notification
No CA/946/92E - Superquinn Ltd./ Tenants of Sundrive Shopping Centre.
Decision
No: 120
Price £0.30
£0.70 incl. postage
Notification
No CA/946/92E - Superquinn/Tenants of Sundrive Shopping Centre
Decision
No: 120
Introduction
1. Notification
was made by Superquinn 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 leases between Superquinn and the tenants of Sundrive Shopping
Centre.
The
Facts
(a) The
subject of the notification
2. The
notification concerns the leases of shop units at Sundrive Shopping Centre,
Sundrive Road, Kimmage, Dublin 6, between Superquinn, as landlord and 14
tenants of the shopping centre.
(b) The
Parties involved
3. Superquinn
is engaged in trading as a supermarket and in the letting of shop units at
shopping centres. The tenants are engaged in various retail activities at
Sundrive Shopping Centre.
(c) The
notified arrangements
4. The
sample shopping centre lease notified was in respect of Unit 1 and was made on
24 November, l984 for a term of 32 years from l October, l984. The restricted
user clauses in the sample lease are as follows:-
(a) Under
clause 4.26 the tenant covenants
"
Not without the prior consent in writing of the Landlord .....to use or to
permit or suffer or allow the Demised unit or any part or parts thereof to be
used for any purpose other than as set forth in Part II of the First Schedule
hereto and for no other purpose or purposes whatsoever...."
2. Part
II of the First Schedule, under the heading permitted user, reads
"Retail
Newsagent Shop including sale of stationery, gifts, souvenirs, sweets,
confectionery.......provided that neither the shop unit nor any part thereof is
used as a specialised record or cassette shop or......the intention being that
the premises shall be a general newsagent shop not competing with other
specialised shops within the Centre."
(b) Under
clause 4.25 the tenant covenants with the landlord
"Not
to assign transfer or underlet or part with possession or occupation save in
relation to the creation of a mortgage of the Demised Unit or any part thereof
or suffer any person to occupy the Demised Unit or any part thereof as a
licensee or as concessionaire
BUT
SO THAT NOTWITHSTANDING
the
foregoing the Landlord shall subject to sub-clause 9.4 hereof not unreasonably
withhold its consent to an assignment transfer or under-letting of the entire
of the Demised Unit or to the suffering of any person to occupy the entire of
the Demised Unit as a licensee or concessionaire."
3. In
addition, there are a number of other standard restrictive covenants and
obligations in the lease.
4. Superquinn
has advised that similar restrictions apply to each tenancy with the permitted
user clause 4.26 confining each tenant to particular specified trading
activities.
Assessment-
The Applicability of Section 4(1)
5. The
Authority considers that Superquinn and the tenants of Sundrive Shopping Centre
are undertakings and that the notified leases are agreements between
undertakings. The agreements have effect within the State.
6. 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 Superquinn and the tenants of Sundrive Shopping
Centre do not offend against Section 4(1) of the Competition Act, l99l.
The
Certificate
7. The
Competition Authority has issued the following certificate.
5. The
Competition Authority certifies that in its opinion, on the basis of the facts
in its possession, the agreements between Superquinn and the tenants of
Sundrive Shopping Centre, Sundrive Road, Kimmage, Dublin 6, in relation to the
lease of premises, notified under Section 7 on 30 September 1992 (notification
no. CA/946/92E), do not offend against Section 4(1) of the Competition Act,
l99l.
6. For
the Competition Authority
Des
Wall
Member
13
October 1993
© 1993 Irish Competition Authority
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