French ferry firm floundering amid allegations of fraud and political meddling

Sea France is one of just two ferry lines operating between Calais and Dover (AFP)

Barring the unforeseen, there will be a shipwreck in the English Channel today.

The rump of the Sealink ferry empire, which once dominated cross-Channel travel, will slide below the waves amid allegations of fraud, union bloody-mindedness, threats of violence and political manipulation.

SeaFrance, owned by the French state, one of two ferry companies operating between Calais and Dover, is likely to be declared defunct by a commercial court in Paris this afternoon. The shortest sea crossing between Britain and the Continent could be left in the hands of two operators: Eurotunnel and the British ferry company P & O.

Efforts were being made yesterday by the French government to save something from the wreckage. A private shipping firm, Louis Dreyfus Armateurs, has offered to compete on the Calais-Dover route using two of the three SeaFrance ships and fewer than half the existing 1,000 SeaFrance jobs, including 127 in Kent.

SeaFrance, owned by the French state railway, SNCF, has been struggling to survive for years. Its three modern car ferries, the Rodin, Berlioz and Molière, have been idle in Calais harbour since November. Attempts to save the company have produced a barrage of accusations and counter-accusations in recent days.

SeaFrance is alleged to have fallen under the control of a rogue trade union branch, which obstructed a possible sell-off to push its own plan for a workers' co-operative.

A criminal investigation was launched last year into suspected systematic fraud aboard SeaFrance ships, including the theft of up to €5m a year in alcohol, perfume and cigarettes. There have been anonymous threats of violence to dissident union members, leaders of other unions and local journalists.

The national and regional leadership of the moderate French trade union federation, the CFDT, took the unusual step last week of repudiating its SeaFrance branch, the CFDT Maritime Nord. The union federation published a letter in which it threatened to exclude local leaders if "the suspicions of obscure and fraudulent practices" were true.

These "obscure practices" are said to have included the assumption of hiring rights at SeaFrance by local union leaders who gave preference to family and friends. Unqualified members of a local amateur football team, AS Marck, are reported to have been employed aboard the ferries. The president and coach of the team were senior officials of CFDT Maritime Nord.

Union branch leaders insist that they are the victims of a "campaign of calumny" by the French press, the government and their own national union leadership. They say that they developed the idea for a "workers' co-operative" because the private takeover offers were manifestly unsatisfactory.

President Nicolas Sarkozy wrong-footed his own government last week when he appeared to back the co-operative plan, an idea rejected by his Transport minister as a doomed project.

The President suggested that the 880 SeaFrance employees in France should pool their redundancy money to raise the €40m needed. Both local and national union leaders later rejected Mr Sarkozy's idea as a "bluff".

SeaFrance is the last survivor of the shipping lines owned by the national railway companies which dominated cross-Channel travel for much of the 20th century and came together in the 1970s and 1980s as Sealink. Unlike its successful British rival P & O, SeaFrance, with less than 20 per cent of the market, has struggled to find a viable business model since the opening of the Channel Tunnel in 1994.

A proposal to refloat the company with €200m of government aid was blocked by the European Commission last year after a complaint by P & O.

Attempts were made over the weekend by a rival, non-union co-operative of SeaFrance workers to resurrect private takeover plans.

The Tribunal de Commerce in Paris is expected to order the company's dismemberment today, but may delay a decision until Wednesday.