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UK government being sued by Eurotunnel over no-deal Brexit ferries contract

Lianna Brinded
Head of Yahoo Finance UK
Moon rises over the English Channel in Dover, UK. Photo: Eddie Keogh/Reuters

Britain’s government is being sued by the channel tunnel operator Eurotunnel over the no-deal Brexit ferries contract.

Eurotunnel said the government’s decision to award firms a contract to charter ferries in the event of a no-deal Brexit, including one that has no ships, was led by a “secretive and flawed procurement process.”

Previously, on 29 December, Eurotunnel’s barrister Daniel Beard QC told the High Court in London that the government contracts were awarded without any public notice and the channel tunnel operator only found out “when contract notices were published three days after Christmas.”

In a public statement, a government spokesperson said: “The Department for Transport [DfT] acted transparently and competitively throughout the process of securing extra freight. This was done by approaching ferry operators and encouraging bids that could be fairly assessed against each other.”

The case comes just two days after the company that was awarded the contract, but has no ships, was axed from the £13.8m ($17.7m) deal.

The DfT said in a statement: “Following the decision of Seaborne Freight’s backer, Arklow Shipping, to step back from the deal, it became clear Seaborne would not reach its contractual requirements with the government. We have therefore decided to terminate our agreement.

“The government is already in advanced talks with a number of companies to secure additional freight capacity — including through the port of Ramsgate — in the event of a no-deal Brexit.”

Meanwhile, although transport secretary Chris Grayling said that no money had been given to either of the firms, Arklow or Seaborne, he refused to comment on how much the cancellation of the contract will cost the taxpayer, in fees or prep work.

Over the last week, the UK government retained lawyers Slaughter and May in a contract worth £800,000 for advice over Eurotunnel taking legal action against it. The law firm was retained prior to Eurotunnel suing the government, in the “highly likely” event that Eurotunnel pursues legal proceedings.