COMPETITION AUTHORITY

Competition Authority Decision of 13 October 1993 relating to a proceeding under Section 4 of the Competition Act, 1991.

Notification No. CA/730/92E - National Carways Ltd/Caddens Pharmacy Ltd.

Decision No. 95		

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Notification No. CA/730/92E ‑ National Carways Ltd/Caddens Pharmacy Ltd

Decision No. 95

Introduction

1.	Notification was made by Cadden's Pharmacy Ltd 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 National Carways Ltd and Cadden's Pharmacy Ltd.

The Facts

(a)	The subject of the notification

2.	The notification concerns the lease of a shop at Unit 1, Tower Road Shopping Centre, Clondalkin, Dublin 22, between National Carways Limited as Lessor and Cadden's Pharmacy Limited as Lessee.

(b)	The parties involved

3.	National Carways Limited, successor to Sherborough Development Co. Ltd is the landlord and lessor of units at the Shopping Centre.  Cadden's Pharmacy Ltd trades as a retail pharmacy at Unit 1, Tower Road Shopping Centre.

(c)	The notified arrangements

4.	The notified shopping centre lease was executed on 26 November, 1985 for a period of 35 years from 1 July, 1985.The restrictive user clauses in the Lease are as follows:‑

(a)	Under clause 18 the lessee covenants

"Not without the prior consent in writing of the Lessor to use the demised premises for any other purpose than as a Chemist Shop Outlet ...and including the sale of Exhibition, Display and Advertising of Photograph Goods, Materials and Equipment and the provision of ancillary Photographic Services and also to include the sale, Exhibition, Display and advertisement of Mother and Baby Care Products Goods and Services and Beauty and Health Care Products Goods and Services."PROVIDED ALWAYS AND IT IS HEREBY AGREED AND DECLARED that upon any application by the Lessee .....for liberty to alter or change the aforesaid permitted user of the demised premises the Lessor shall not unreasonably withhold its consent to such proposed change of user .......but in considering the matter full account shall be taken of the fact that the demised premises forms part of the Tower Road Shopping Centre in which it is necessary and desirable ..... that the nature of the businesses carried on in the Tower Road Shopping Centre as a whole should be as diverse as possible ..........  IT IS HEREBY AGREED between the parties hereto that during the continuance of the term hereby created no other unit in the Centre shall be used as a Chemist Shop Outlet ....

(b)	In Clause 24 the tenant covenants with the landlord

"Not to assign underlet or part with or share possession or permit the occupation by a Licensee of the demised premises or any part thereof (or suffer any person to occupy the demised premises or any part thereof as Licensee or as Concessionaire) without the prior consent in writing of the Lessor such consent not to be unreasonably withheld....."

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 Cadden's Pharmacy Limited and National Carways 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 National Carways Limited and Cadden's Pharmacy Ltd does not offend against Section 4 (1) of the Competition Act 1991.

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 National Carways Ltd and Cadden's Pharmacy Ltd in relation to the lease of the premises at Unit 1, Tower Road Shopping Centre, Clondalkin, Dublin 22, notified under Section 7 on 30 September 1992 (notification no. CA/730/92E), does not offend against Section 4 (1) of the Competition Act, 1991.

For the Competition Authority

Des Wall
Member
13 October 1993