Friday, June 12, 2015

Don't Start Up the Fat Lady’s Music on the Cross Channel RoRo Freight Ferry Court Case Just Yet

The MyFerryLink - Eurotunnel - SeaFrance - DFDS Legal Conundrum Show Keeps Getting Encores!
Shipping News Feature

FRANCE – UK – Hard to credit we know for anyone who has followed the story, but the MyFerryLink saga in which the company arose from the ashes of SeaFrance only to be extinguished by the UK authorities, has now taken two further turns this week alone. The story so far; SeaFrance folded, the unemployed workers formed ‘SCOP’, Eurotunnel bought the RoRo Freight and passenger ferries to operate in tandem with the tunnel, labour courtesy of a contract with SCOP, the deal was passed by the French, stymied by the UK (saying it contravened merger regulations and reduced competition in the trade as Eurotunnel had too much of it) ad seemingly infinitum.

Since then Eurotunnel’s new subsidiary has continued to operate the Calais/Dover route using SCOP labour as one or another UK Court changed the decision this way and that (if you want the full story type MyFerryLink or SeaFrance into the News Search box above). Last week, despite SCOP winning its last Court appeal, Eurotunnel announced it had a binding agreement from DFDS to buy two of the old SeaFrance ferries and continue a service on the route.

Now however the Commercial Court in Boulogne-sur-Mer has placed SCOP SeaFrance into Judicial Administration. SCOP is therefore in the hands of Court appointed Judicial Administrators and it is their responsibility now, working with DFDS, to define the conditions for the recruitment of staff. The Eurotunnel Group has confirmed that it holds a binding offer from the DFDS Group for the purchase of the two ships, Berlioz and Rodin. To avoid any interruption to services from the port of Calais, the Eurotunnel Group says it will lease the Berlioz and the Rodin to DFDS from 1 July 2015.

Eurotunnel has also confirmed that the only contractual relationships existing between MyFerryLink and SCOP SeaFrance are the operating contracts which expire at midnight on 1 July 2015. Jacques Gounon, Chairman and Chief Executive Officer of Groupe Eurotunnel SE, said of the situation:

“Following the announcement of Judicial Administration, the priority is that contact is established between the SCOP SeaFrance and DFDS to discuss the issue of employment.”

The legal wrangle however doesn’t end there. The Competition and Markets Authority, disturbed by the plethora of legal points regarding what constitutes a merger, and the balance between anti-competitive practices and fair trade, have today (June 12) lodged an application with the Supreme Court for permission to appeal the recent Court of Appeal decision on the Eurotunnel case which SCOP won with a 2 to 1 majority, and issued a statement saying:

‘Clearly we’re aware of Eurotunnel’s announcement earlier this week that it intends to sell two of its ferries to DFDS and we will continue to follow that development closely. However as this deal is not completed and as there are arguably broader legal issues, we have chosen to make our application for permission to appeal today (being the deadline for doing so).’

So Eurotunnel has neatly dropped the problem of staffing the ships into the hands of DFDS. With summer bookings already in place the new owners will have to move swiftly to decide how they are to utilise the 370 on board and 106 land based staff they have not actually inherited, if at all. With the memory of various labour wrangles at SeaFrance before its demise, and the opportunity to use economy of scale in its current operation, all eyes will be on DFDS to see how they handle what could be a very tricky situation.