Eurotunnel to fight ban on its Dover ferries

Competition Commission had expressed concern that expansion could be used to hike prices
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Eurotunnel today vowed to appeal the Competition Commission’s decision to ban it from operating ferries from Dover, claiming the move was “incomprehensible and seriously disproportionate”.

After an eight-month investigation, the CC ordered Eurotunnel to stop running the ferries business it bought from collapsed operator SeaFrance last year, saying the acquisition would mean higher prices for cross-Channel passengers and freight hauliers.

Since buying three of SeaFrance’s four vessels for €65 million (£55 million) last May, Eurotunnel has been running them between Dover and Calais under the MyFerryLink brand.

The CC’s move puts MyFerryLink’s 600-strong workforce, including 100 staff at Dover, at risk, and could hit passengers at the height of summer.

But the CC said Eurotunnel had bought the ferries “in order to prevent ferry operator DFDS/LD from buying them”, amid concern that such a deal would see journey prices fall. The inquiry chairman, Alasdair Smith, said: “It cannot be good for competition when Eurotunnel, which already holds a [cross-Channel] market share of over 40 per cent, moves into the ferry business, particularly when it did so to stop a competitor from buying the ferries. Customers would lose out.” He added the excess capacity on the Dover-Calais route meant that one of the current ferry operators was expected to exit the market “if we don’t take action”.

But Eurotunnel responded that the move was “not based on any concrete facts, but solely upon a random association of virtual hypothesis”.

It claimed the CC’s decision would “restructure the maritime activity across the Straits of Dover into a duopoly, prohibit access to a port, in total contradiction with the freedom of movement incarnate in Europe, and deprive the ports of Dover and Calais of significant revenues”.

Even if it loses, Eurotunnel will not be able to sell MyFerryLink, as it is banned by a French court from doing so for at least five years.

Jacques Gounon, chairman of Eurotunnel, added: “This decision by the Competition Commission will reduce the choice of services across the Straits of Dover to the detriment of the consumer. It will inevitably lead to an increase in the price of a crossing.”