Secretary of State upholds ferry companies’ argument that Dover Harbour Board is dominant

29/05/12

In a detailed decision following a lengthy public inquiry, the Secretary of State for Transport upheld the argument of P&O Ferries, DFDS and SeaFrance that Dover Harbour Board ["DHB"], which operates the Port of Dover as a trust port, was dominant in the market for the provision of port facilities in Dover Harbour to ferry operators between Dover and Calais/Dunkerque in both directions.

The decision was made in the context of an inquiry into the port dues charged by DHB in 2010 and 2011. Section 31 Harbour Act 1964 gives interested parties the right to object to such dues. Such objection may be heard by way of public inquiry, the findings of which are then passed to the Secretary of State who then makes a final determination.

The three ferry companies contended, and the inquiry and the Secretary of State agreed, that when determining the objections, the DHB had to demonstrate that the dues were commercial and competitive, fair and equitable and in all respects reasonable. When determining the "competitive" criterion, the Inspector held issues on UK and EU competition law were beyond his remit and that they were matters for the Secretary of State. The Secretary of State considered that she was not obliged by EU law to apply Article 102 TFEU as part of her decision-making process under s.31 Harbours Act. However, she did accept that she should consider the matter on the basis that the decision on the level of dues under s.31 did constitute enacting or maintaining in force a measure for the purpose of Article 106 TFEU and that accordingly she should investigate the objectors' competition law contentions. In so doing, she found that DHB was in a dominant position on the market but that the dues imposed were neither excessive nor unfair.

In coming to her decision, the Secretary of State explicitly noted the stated intention of DHB, which was pronounced at the inquiry hearing, that whatever cash surplus existed at the point of privatisation would be ring-fenced for the benefit of the objectors in terms of future capital expenditure.

2010 decision.

2011 decision.