COMPETITION AUTHORITY

Competition Authority Decision of 5 October 1993 relating to a proceeding under Section 4 of the Competition Act, l99l.

Notification No:  CA/104/92E ‑Melcorpo Ltd/Marspel Ltd.

Decision No: 89

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Notification No. CA/104/92E ‑Melcorpo Ltd/Marspel Ltd

Decision No. 89

Introduction

1.	Notification was made by Marspel Ltd on 24 September l992 with a request for a licence under Section 4(2), of the Competition Act, l99l in respect of a lease between Melcorpo Ltd and Marspel Ltd.

The Facts

(a)	The subject of the notifications

2.	The notification concerns the lease of a shop unit, Unit 3 at Bray Shopping Centre, Bray, Co.Wicklow between Melcorpo Ltd as lessor and Marspel Ltd as lessee.

(b)	The parties involved

3.	Melcorpo Ltd is owner and lessor of shop units at Bray Shopping Centre.  Marspel Ltd, under the name Tabloid Newsagents trades as a newsagents at the centre.

(c)	The notified arrangements

4.	The notified shopping centre lease was executed on l December, l976 for a period of 30 years from l4 April, l976.  The restricted user clauses in the lease are as follows:‑

(a)	Under clause B(12) the Lessee covenants with the Lessor

"Not to use or suffer to be used the demised premises or any part thereof for any purpose other than as a Newsagency without the consent of the Lessor under its seal first obtained.  PROVIDED ALWAYS that the Lessee shall have the sole right in the Shopping Centre to sell and deal in for cash newspapers, magazines, papers, annuals (save children's annuals) greeting cards and stationery."

(b)	Under clause B(l5) the Lessee covenants with the Lessor

"Not to assign or under‑let or part with the possession of the demised premises or any part thereof or otherwise alienate same without the previous written consent of the Lessor such consent not to be unreasonably withheld."

(c)	Under Clause C(4) the Lessor covenants with the Lessee:‑

"Not to lease or alienate any part of the Bray Shopping Centre without first reserving thereout for the benefit of the Lessee rights and privileges corresponding to and reciprocal to those expected and reserved in favour of the Lessor and others out of these presents."

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

Assessment ‑ The Applicability of section 4(1)

5.	The Authority considers that Melcorpo Ltd and Marspel Ltd  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 Marspel Limited and Melcorpo Limited does not offend against Section 4(1) of the Competition Act, l99l.

The Certificate

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 Melcorpo Limited and Marspel Limited (trading as Tabloid Newsagents) in relation to the lease of the premises at Bray Shopping Centre, Bray, Co. Wicklow notified under Section 7 on 24 September 1992 (notification no. CA/104/92E), does not offend against Section 4(1) of the competition Act, l99l.

For the Competition Authority

Des Wall
Member
5 October 1993