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Eurotunnel and ports fall out over funding

[ June 12, 2015   //   ]

A legal row has broken out between Channel Tunnel operator Eurotunnel and the ports of Calais and Boulogne, along with local government bodies. It follows Eurotunnel’s filing on 10 April of an appeal at the Lille Administrative Court that sought to cancel public funding for the Calais Port 2015 project.
Now, however, representatives of the two ports have responded in an open letter to Eurotunnel shareholders. In it, Pas-de-Calais senator Daniel Percheron, member of Parliament Yann Capet, president of the Pas-de-Calais General Council Michel Dagbert and president of the Scoiete d’Exploitation des Ports du Detroit (essentially the ports on the Calais-Boulogne Straits) argue that t funding for the scheme is not illegal. They accuse Eurotunnel Group chairman Jacques Gounon of “misleading and false information”, particularly in a letter to shareholders on 1 June. They argue that a figure of €270m of public subsidies as coming entirely from the Nord-Pas de Calais region is “simply untrue” and includes an expected €100m contribution from the EU, and a similar amount from the French state. The Calais Region subsidy is only €43m, they say.
Public funding “is more than usual for such an operation and that the €270m share of the total of €900m “is actually particularly low for a port infrastructure” and well below other similar recent port projects.
There has been no loan guarantee by the region, and funding of Calais Port 2015 “is strictly based on a market rate that was negotiated with financial institutions.
They also say that Gounon was at one stage a stakeholder in the project and participated in the drafting of interim offers and raised no objections then.
They also warn that the consortium behind the Calais Port 2015 project could seek compensation from Eurotunnel Group if it were to undermine the project.
In a press statement, Jean-Marc Puissesseau said: “Two actors such as the Port of Calais and Eurotunnel cannot oppose each other, much less on the basis of false information. Calais Port 2015 will not allow any price dumping and does not threaten the competitiveness of Eurotunnel.
“Public support for an infrastructure of general interest such as the Port of Calais is absolutely usual for this type of project, as are the financial clauses, the public service delegation contract and the proposed market rates of the project. …We call on Eurotunnel’s shareholders to convince Mr Gounon to withdraw his appeal in order to fully enable the complementarity of these two major players.”
Eurotunnel has not responded directly to the claims in the letter. However, industry sources suggest that while it has no objection to the plans to create more warehouse and logistics facilities in Calais – which would benefit its freight shuttles along with the ferries – it does take issue with the level of guarantees being made to promoters which could lead to water-borne services that could abstract business. In particular, it is concerned over plans unveiled by the VIIA Britanica French Railways subsidiary to operate trailer-carrying rail services from the Spanish-French border by the end of the year. As these would operate direct into the port to Calais, the vast majority of the traffic would move across the Channel on the ferries.
Eurotunnel is also reported to be somewhat bemused by the very public stance taken by the Calais consortium and its tactics of writing directly to its shareholders, rather than talking to the judge involved in the case.

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