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MyFerryLink Bids 'Not Satisfactory'

Tuesday 05 May 2015

The uncertainty over the future of the cross-channel ferry service MyFerryLink continues, with Eurotunnel finding it difficult to dispose of the company.

Eurotunnel needs to sell the ferry firm by July 9 and has predicted there will be traffic chaos in Dover and Calais if it fails to do so.

Last January, the UK Competition and Markets Authority ordered the group to cease its maritime business, giving it six months to find a buyer. If the ships are not sold by the deadline they will have to be kept in dry dock.

Although Eurotunnel has refused to divulge the names of bidders it is believed to include existing cross-channel operators P&O and DFDS, as well as two others.

However, the sale process does not appear to be an easy ride, with existing bids not considered satisfactory due to employment related issues.

In a statement, Jacques Gounon, Director General of Eurotunnel, stated: "Des offres ont été déposées par des candidats intéressés par cette reprise, mais elles ne sont pas satisfaisantes, notamment d’un point de vue social. Je demande aux candidats de reformuler leurs offres d’ici le 11 mai."

This was always going to be a potential sticking point, which we flagged up in our Newsletter earlier this year, when we reported on the decision of the UK Competition Appeal Tribunal (CAT) to confirm the ban on the group operating a ferry service out of Dover.

Eurotunnel employ no staff in MyFerryLink, as the service is provided through the French based workers cooperative 'SCOP', who operate the service under contract from Eurotunnel. The coop is a completely separate legal entity, and run by a strongly militant group of trade unionists. They have appealed the decision of the CAT and a decision is awaited.

It is highly likely that any new owner would want to change such operational arrangements, but there are significant legal, political and industrial risks in trying to unbundle it, for the cooperative is strongly backed by the French government.

Eric Vercoutre, a local maritime trades union leader has previously warned about the risk of selling to an unsuitable buyer, stating that: "We must not end up in low-cost hands that would break our project".

On the sidelines of the sale process, there is already significant turmoil taking place between the coop and the MyFerryLink management team, with the former effectively trying to remove some of the existing directors.

In addition, there is also protest at the legal action being taken by Eurotunnel against the €650 million redevelopment project for the port of Calais, which aims to significantly improve the maritime services of the port.

In a statement concerning the new terminal project, Jacques Gounon has stated: "The European Commission subsidizes the construction of a new rail terminal in the port, which seems to me schizophrenic and illogical; they ask us to run more trains through the tunnel, but at the same time ensure that these trains unload their goods in the port of Calais on to ferries."

As if that were not enough, Eurotunnel is also taking legal action over the decision of the regional council to award to the local Chambre de Commerce the contract for managing the port.

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