Abbey Simmons considers whether to remove or make safe apparatus under a wayleave agreement while Angus Coulter explains some of the competition issues that supermarkets face.
Q: I'm entering into a wayleave agreement and the operator wants to "make safe" the apparatus at the end of the wayleave term rather than removing the apparatus. Should I be concerned?
A: This depends upon the type of apparatus being installed and where it is being installed.
If the apparatus being installed is internal cabling for the benefit of a tenant then you should be concerned. In this scenario, if the operator "makes safe" the apparatus they are not under an obligation to remove the apparatus. You could end up with so much apparatus in your risers that you do not have room for anything more. This could also lead to a property management issue as the equipment may not be labelled correctly and you may not know which apparatus is redundant or in use.
However, if the apparatus is being buried underground then it may be easier, for all concerned, if the apparatus is made safe rather than removed. The main issue is to consider what type of apparatus is being installed, where it is being installed and what you would like the operator to do with it at the end of the wayleave term.
Q: I am acting for a landlord who is granting a lease to a supermarket that forms part of a wider development. The supermarket tenant wants the landlord to covenant that they will not grant any lease to any other food retailer in the remainder of the development. Do I need to think about competition issues?
A: Yes. There are seven "Large Grocery Retailers" for the purposes of the Groceries Market Investigation (Controlled Land) Order 2010 (Controlled Land Order). If the supermarket is one of those seven, there is a stricter competition regime.
The Controlled Land Order restricts the ability of large grocery retailers from enforcing, or entering into, exclusivity agreements the effect of which is to prevent or restrict another grocery store operating from the same site.
Large grocery retailers must not enter into new exclusivity arrangements with a duration of more than five years from the date on which the store in question began trading.
In addition, large grocery retailers must not (subject to certain specified exceptions) enter into new restrictive covenants that may restrict grocery retailing (that is prevent the land from being used for grocery retailing). This includes agreements which have an equivalent effect, such as a covenant that limits access to properties for certain vehicles that could prevent required deliveries. This stricter regime applies regardless of whether there is any actual impact on competition.
Whether or not the supermarket involved is one of the seven, the ordinary competition law regime will apply and would need to be considered, which requires a fact-specific sensitivity analysis to determine whether a covenant is, in fact, anti-competitive and, only if it is, will it be void.