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Eurotunnel purchase of Sea France ferries faces inquiry | Eurotunnel purchase of Sea France ferries faces inquiry |
(about 1 hour later) | |
Eurotunnel's purchase of assets from the former ferry operator Sea France is to face an inquiry over worries the deal could reduce competition and raise fares for cross-Channel travellers. | Eurotunnel's purchase of assets from the former ferry operator Sea France is to face an inquiry over worries the deal could reduce competition and raise fares for cross-Channel travellers. |
The acquisition has been referred to the Competition Commission by the Office of Fair Trading (OFT). | The acquisition has been referred to the Competition Commission by the Office of Fair Trading (OFT). |
Sea France went into liquidation in November last year, and Eurotunnel bought assets including three ships. | Sea France went into liquidation in November last year, and Eurotunnel bought assets including three ships. |
These ships now operate between Dover and Calais under the MyFerryLink brand. | These ships now operate between Dover and Calais under the MyFerryLink brand. |
Eurotunnel leases the ferries to MyFerryLink, which is operated primarily by former employees of Sea France. | |
Eurotunnel already operates the Channel rail tunnel, and runs the Le Shuttle services. | Eurotunnel already operates the Channel rail tunnel, and runs the Le Shuttle services. |
In referring the deal, the OFT noted that, prior to its liquidation, Sea France had been a "close competitor" to Eurotunnel. | In referring the deal, the OFT noted that, prior to its liquidation, Sea France had been a "close competitor" to Eurotunnel. |
"Although some competitors remain after the merger, the evidence available to the OFT indicates that only P&O will provide a strong competitive constraint to Eurotunnel for some customers." | "Although some competitors remain after the merger, the evidence available to the OFT indicates that only P&O will provide a strong competitive constraint to Eurotunnel for some customers." |
Amelia Fletcher, OFT chief economist and decision maker in this case, said: "We are concerned that the merger could further strengthen Eurotunnel's position in the market for cross-Channel transport and prices could go up as a result. | Amelia Fletcher, OFT chief economist and decision maker in this case, said: "We are concerned that the merger could further strengthen Eurotunnel's position in the market for cross-Channel transport and prices could go up as a result. |
"As such, we believe it is appropriate that the Competition Commission reviews this merger in detail to ensure that the interests of consumers and industry are protected." | "As such, we believe it is appropriate that the Competition Commission reviews this merger in detail to ensure that the interests of consumers and industry are protected." |
Eurotunnel said that its purchase of Sea France's assets followed the decision of a French court. It also added that the French competition authority is looking into the deal and is finalising its analysis. |