Notification No:  CA/386/92 ‑ Salix Trust Limited/Huntbrook Limited.

Decision No: 200

Introduction

1.	Notification was made by Salix Trust 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 lease between Salix Trust Limited and Huntbrook Limited.

The Facts

(a)	Subject of the notification

2.	The notification concerns the lease of unit 45B, Block 5 in the Stillorgan Shopping Centre, Stillorgan, Co Dublin between Salix Trust Limited as landlord and Huntbrook Limited as tenant.

(b)	The parties involved

3.	Salix Trust Limited is the owner and landlord of the Stillorgan Shopping Centre.  Huntbrook Limited under the name "Villaflora" trades as a florist at the shopping centre.

(c)	The notified arrangements

4.	The notified lease was made on 12 February, 1992 for a term of 35 years from 1 December, 1991.  The restricted user clauses in the lease are as follows:

	(a)	Under clause 14 of Section III the tenant covenants with the landlord  "To use the demised premises for the purposes of retail florist, fruiterers, confectioners, including plants, forest sundries and related accessories and merchandise but not further or otherwise and not without the Landlord's Consent in writing (which shall not be unreasonably withheld) to use or permit or suffer the same or any part thereof to be used for any other purpose".

	(b)	Under clause 16.1 of Section III the tenant covenants with the landlord "Not to assign, transfer, underlet, franchise, charge, mortgage, hold on trust for another or part with the possession or occupation of the Demised Premises or any part thereof or suffer any person to occupy the Demised Premises or any part thereof as a licensee franchisee or as concessionaire BUT SO THAT NOTWITHSTANDING the foregoing the Landlord shall (subject as hereinafter provided) not unreasonably withhold its consent ......"

	(c)	Under clause 14 of the Third Schedule the tenant covenants with the landlord  "Not to use, permit or suffer the demised premises to be used in any way whatsoever for the sale or supplying of beer, wine, spirituous liquors or other intoxicating liquor whether the same are sold or supplied for consumption on or off the demised premises."

	(d)	Under clause 5 of the Fourth Schedule the landlord covenants with the tenant  "The Landlord shall not let any unit, consent to assign any unit to a retail florist.  Should the Landlord be forced to defend this position in a court of law or a similar forum, the tenant will defray all costs."

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 Salix Trust Limited and Huntbrook 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 of 10 September, 1993, pp. 665‑667).  The Authority therefore considers that the notified agreement between Salix Trust Limited and Huntbrook 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 Salix Trust Limited and Huntbrook Limited in relation to the lease of the premises at Stillorgan Shopping Centre, Stillorgan, Co. Dublin notified under Section 7 on 30 September, 1992 (notification no. CA/386/92), does not offend against Section 4(1) of the Competition Act, l99l.

For the Competition Authority

Des Wall
Member
3 December 1993