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UK's opposition Labour chides government over Brexit ferry contract

LONDON (Reuters) - Britain’s opposition Labour Party criticized the government on Monday for awarding a 14 million pound ($18 million) contract to a ferry company with no ships to provide backup freight cover in case the country exits the European Union without a deal.

Labour’s transport spokesman, Andy McDonald, said the transport ministry had failed to carry out proper checks on the company, Seaborne Freight, contrary to what it had asserted.

He pointed to “mounting evidence of a lack of relevant expertise or experience” on the part of Seaborne.

“Our economy depends on these trading routes continuing to function yet [Transport Secretary] Chris Grayling is prepared to rely on amateurs in the event of a no deal,” he said.

“A no-deal (Brexit) scenario would be terrible for our transport networks under any circumstance but the sheer incompetence with which preparations have been handled is alarming in the extreme.”

Seaborne Freight Chief Executive Ben Sharp rejected the criticism and said the company had been working on providing a ferry service for the last two years.

“Collectively, the directors and investors of Seaborne have significant experience in operating vessels and ferries alike - in particular ferries in the Channel,” he told Reuters.

“Seaborne is no threat to the United Kingdom because they are not paying us anything until we deliver. So, what is the problem?”

Currently, Britain’s EU membership means that trucks drive smoothly through border checks within the 28-nation bloc. But in a no-deal Brexit, even a few minutes’ delay at customs for each truck could mean vehicles backed up at ports and queued on feeder roads on both sides of the Channel.

British lawmakers are expected to reject Prime Minister Theresa May’s Brexit deal, potentially leading to a disruptive departure of the UK from the EU on March 29 without an agreement on their relationship.

Britain awarded contracts worth more than 100 million pounds in total to three shipping firms to provide extra ferries. The other two are established operators - French firm Brittany Ferries and Danish group DFDS.

Grayling said on Monday the contract with Seaborne was “subject to the achievement of a range of key milestones”.

“It is not uncommon that they do not own their own vessels and will be chartering them through third parties,” Grayling said. “The bids we received to provide capacity were subject to technical, financial and commercial assurance.”

In a review of UK filings, Seaborne Freight’s Sharp served as a director with a shipping company, Mercator International Ltd, which filed for insolvency in 2014. The firm owed creditors 1.7 million pounds, a filing for the year to March 31, 2013 showed.

Sharp said: “That was part of a complex chartering contract that failed, and the company was wound up in the United Kingdom. The directors were not sanctioned, disciplined or criticized and that has never changed.”

Seaborne Freight faced separate criticism last week when its business terms and conditions showed references to placing “any meal/order”, prompting speculation on social media that it had copied the format from a takeaway delivery company. Seaborne has since updated its website.

Additional reporting by Kylie MacLellan Editing by Guy Faulconbridge and Kate Holton/Mark Heinrich