UK Suspends Contract for Port of Ramsgate "Brexit" Ferry

The government of UK Prime Minister Theresa May has canceled a contract with a newly-formed ferry company for a backup service between Ramsgate and Ostend, Belgium. The startup, Seaborne Freight, lacked prior experience and did not own vessels for the service; an expected financial backer, Arklow Shipping, exited the plan, prompting the Department for Transport to withdraw from the agreement. 

Last year, in preparation for the potential disruption from a "no-deal" Brexit, the DfT chartered new ro/ro capacity from Seaborne Freight, DFDS and Brittany Ferries. The additional vessels were intended as a contingency plan, and would provide up to 4,000 trucks per week of freight capacity to offset expected bottlenecks at busy ro/ro ports. In particular, the services were earmarked for priority shipments like medicine. The contingency agreements with DFDS and Brittany Ferries remain in effect. 

At present, trucks can transit between ro/ro ports in Britain and the EU without customs paperwork at the terminal. This longstanding trade arrangement will end on March 29, "Brexit Day," unless British and EU negotiators can reach an acceptable "transition period" agreement. However, analysts suggest that such a deal may prove elusive before the deadline, given the challenges of finding a compromise that can pass muster in both Brussels and in the UK Parliament. In the event of an abrupt Brexit, new customs measures may lead to extended delays at key Channel crossings. In addition to the charters, Britain intends to temporarily suspend customs inspections for most truck-borne EU goods, but checks are expected on the European side of the Channel. 

The Ministry of Transport's vessel charter with Seaborne came under fire in December when it emerged that the firm lacked vessels and crew. The contract received more scrutiny after reporters found that Seaborne appeared to have copied text for its website from a takeout food delivery company: The Terms & Conditions section of Seaborne's home page noted that “it is the responsibility of the customer to thoroughly check the supplied goods before agreeing to pay for any meal/order,” and that “delivery charges are calculated per order and based on [delivery details here].”

While Transport Minister Chris Grayling has indicated that no money has been spent on the Seaborne contract, an audit revealed that the Department for Transport had spent about $1 million on consulting fees related to evaluating Seaborne's bid - and had proceeded with the contract despite a consultant's misgivings of "significant execution risks." After the release of the audit results early this week, shadow transport minister Andy McDonald called on Grayling to resign. 

In a statement, DfT said that it remains focused on averting disruption in the event of a no-deal Brexit.  “We have procured a number of routes to ensure resilience through our contracts with DFDS and Brittany Ferries. These routes will be used for priority goods, including medicines," said DfT in a response. “We are continuing to work with key sectors to understand their capacity needs and ensure that supplies of priority goods continue in any scenario."