Eurotunnel pushes for end to duty-free in EU: Ferry operators accuse 'spoilsport' Morton of creating smokescreen

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SIR ALASTAIR Morton, Eurotunnel's co-chairman, was yesterday accused by Stena-Sealink, the ferry operator, of being a spoilsport and of deliberately trying to divert shareholders' attention from the problems at his company, following a call for the duty-free market to be abolished.

Eurotunnel is applying to the High Court for a judicial review against the European Union's decision last year to give the duty-free market a stay of execution until 1999.

The company said the EU ruling would deprive it of pounds 170m in revenue between now and 1999.

Eurotunnel claimed it was led to believe that duty-free would be abolished last year, and had therefore not designed its shuttle trains to incorprate shops.

'We believe duty-free is a government subsidy for the ferry companies and gives them a chance to keep the fares down,' a Eurotunnel spokeswoman said.

That argument drew a terse response from Stena. A spokesman said: 'We think this is a deliberate smokescreen by Sir Alastair Morton to distract the attention of shareholders away from the real issues. For one, the tunnel for some reason is not open. And it is turning into a financial disaster.

'Sir Alastair is a spoilsport. He should spend his time getting the tunnel working instead of trying to spoil a perk legally enjoyed by millions of Britons every time they travel by air and sea.'

Eurotunnel said: 'Nothing could be further from the truth. We designed the project and raised money on the grounds that duty- free would be abolished in 1993 to coincide with the introduction of the single market. This situation is unfair for our shareholders.'

Peninsular and Oriental Steam Navigation, operator of the P&O ferry line, backed Stena.

'We don't think day-trippers or the airlines would be too pleased. Passengers see it as an additional benefit of travelling.'

Eurotunnel's case, besides being built around the 'unfair' five-year extension for duty-free shoppers, will be bolstered by some financial arguments - ' pounds 170m is what we believe our additional revenues would be between now and 1999 if duty-free was abolished. Some pounds 125m of profits a year for the ferry companies come from duty-free.'

The financial argument, though, was dismissed by P&O, which said: 'They could take the benefit if they wanted to.'