Tradewinds – Eurotunnel barred

(Written by Gary Dixon)

6 June 2013 - France’s Eurotunnel has been banned from operating two MyFerryLink ro-paxes from Dover for 10 years.

The UK competition commission (CC) also said the company was not allowed to operate with any other vessels at the port for two years.

The final decision is the result of a probe into the acquisition by Eurotunnel of three ferries from the defunct SeaFrance, which it deployed between Dover and Calais under the MyFerryLink banner.

The CC said the deal could mean higher prices for cross-Channel passengers and freight customers.

It added that Eurotunnel’s market share would rise to more than 50%.

The commission also found that the purchases were made to prevent the rival joint venture between DFDS and LD Lines buying them.

“Eurotunnel was concerned that if DFDS/LD obtained the assets cheaply, it could drive down prices for customers,” it said.

It believes one of the three operators on the route, including P&O, was likely to exit in the short term if the CC took no action.

Eurotunnel immediately said it would appeal.

It called the decision “incomprehensible and seriously disproportionate” and said it was not based on facts.

The group added that the move “restructures the maritime activity across the straits of Dover into a duopoly, thereby disadvantaging consumers.”

Eurotunnel could now be forced to sell the 1,500-gt Rodin (built 2001) and the 1,900–passenger Berlioz (built 2005), but this would bring it into conflict with a ruling of the Paris commercial court, which bars their resale for five years.

The French competition authority has cleared the deal.

CC deputy chairman Alasdair Smith said: “We did consider ordering Eurotunnel to sell the ferries but we were conscious of the uncertainties and possible delays affecting a sale.”

The CC is instead giving Eurotunnel a limited period to sell the ships to one or more purchasers approved by the CC.

DFDS acknowledged the ruling in a statement, but said merely: “DFDS’ profit expectations for the remaining year are therefore unchanged.”