Eurotunnel has accused the British government of “distortionary and anti-competitive” behaviour for awarding up to £103m to three ferry companies to provide additional cross-Channel capacity in the event of no-deal Brexit.
Jacques Gounon, chief executive of Getlink — the Paris-based parent company of Eurotunnel — wrote to to transport secretary Chris Grayling on January 2, saying London had breached EU “competition and state-aid law”.
His complaint revolved around the transport department’s offer to provide funding to three companies — Brittany Ferries, DFDS and Seaborne Freight. They have been asked to provide space on alternative ferry routes to the main Dover-Calais artery in the event of a no-deal exit from the EU in March to transport urgent supplies such as medicines.
In the letter, obtained by the Financial Times, Mr Gounon said the company had read about the £103m announcement with “serious concern”.
“I must bring to your attention the distortionary and anti-competitive effects of such an action, which would be a unilateral breach not only of the Concession Agreement with Eurotunnel but more widely of existing competition and state aid law,” the letter said.
The chief executive also hinted at possible legal action in an attempt to obtain a level playing field. “We reserve all our rights to challenge such a measure both in the UK and France,” he said.
Mr Gounon complained that the government had ignored “Le Shuttle”, Eurotunnel’s train service under the English Channel for vehicles which he argued was the most efficient way to supply vital goods into the UK. That would remain the case even if new border procedures were introduced by countries after Brexit, he added.
This is yet another terrible indictment of Chris Grayling’s judgment which casts further doubt on the lawfulness and deliverability of his ferry contract awards
Andy McDonald, shadow transport secretary
Eurotunnel staff were ready to operate additional services — if funded by the government — or lay on additional rail freight trains. “In any eventuality, Eurotunnel remains prepared to deliver additional capacity,” he wrote. “I would ask you please to confirm that you are open to replicating the same kind of contracts with us.”
Eurotunnel was forced to give up its own Dover-Calais ferry service in 2015 after a ruling against it by the Competition and Markets Authority.
Andy McDonald, shadow transport secretary, said Mr Grayling had overlooked a “tried and tested” operator in Eurotunnel in favour of the “untested” Seaborne: “This is yet another terrible indictment of Chris Grayling’s judgment which casts further doubt on the lawfulness and deliverability of his ferry contract awards. He should revoke the Seaborne Freight contract forthwith.”
Unite the Union, which has 350 members at Eurotunnel, said the DfT’s actions had left workers at the company fearing for their futures. Dave Weeks, Unite’s regional organiser, said it was “simply astonishing” that Mr Grayling had ignored the “one permanent link” between the UK and the continent. “Instead he has opted to give public funds to its competitors including a company with ghost ships and no usable harbour,” he said.
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| A Eurotunnel train leaves the Eurotunnel, entering France, near Calais, France, on Wednesday, April 16, 2008. Groupe Eurotunnel SA, operator of the rail tunnel linking England and France, said first-quarter sales rose 15 percent as it carried more trucks and Eurostar train passengers. |
Mr Weeks said Eurotunnel was ready and able to join the no-deal Brexit preparations. “The government must review its decision and end the threat that their actions pose for Eurotunnel,” he said.
The DfT said its ferry contracts were “entirely compliant with UK law” and only represented one element of its contingency work. “The government has invested heavily to ensure disruption at our ports is minimised in a no-deal scenario, while maximising flows through Eurotunnel and Dover continues to be our highest priority.”
One government official said the department was still holding discussions with various companies to assess other potential options such as additional rail freight services.
