Eurotunnel is to be banned from operating ferry services between the UK and France after the Competition Commission ruled such a move would lead to price rises for passengers.
The cross-Channel rail operator, which launched its Dover to Calais ferry service last August, said it will appeal the decision.
Eurotunnel bought three ships from SeaFrance, which went bust in November 2011, and leased them to start-up MyFerryLink, which is run by former SeaFrance employees.
However, the Competition Commission said Eurotunnel had bought the ferries for £56 million in order to prevent rival DFDS/LD from snapping them up and driving down the price of cross-Channel travel.
‘It cannot be good for competition when Eurotunnel, which already holds a market share of over 40%, moves into the ferry business—particularly when it did so to stop a competitor from buying the ferries," said Competition Commission deputy chairman Alasdair Smith.
"Customers would lose out from Eurotunnel increasing its share even further and being able to raise prices on the tunnel services."
The ruling confirmed the Competition Commission’s provisional findings, published in February.
Smith said there was already excess capacity on the ferry route and if the Commission did not intervene to stop Eurotunnel one of the two independent ferry operators might be forced out.
"Customers will be better off if there are two independent ferry companies competing with the tunnel than if one of the two is owned by Eurotunnel," he added.
The Commission said Eurotunnel would be granted a limited period during which to sell its two largest ferries before the ruling is implemented.
