Jacob Panons

BBC News, South East

A ferry company says it has launched legal action to sue a shipping company for £125m of losses sustained because of the "vast subsidies" given to its competitor.

Brittany Ferries says grants DFDS receives to run its ferry route between Newhaven in East Sussex and Dieppe in France have affected its own routes between Portsmouth and France, costing its business £125m since 2013.

Christophe Mathieu, the company's CEO, said: "Hauliers and passengers are turning to low-cost Newhaven because of this significant market distortion."

A DFDS spokesperson said: "In light of the ongoing legal proceedings DFDS will revert before the court and will not for now comment in public."

In an action lodged with the Brest Commercial Court, Brittany Ferries says it is seeking to recover "significant losses that come from this unfair competition" because of the grants from Syndicat Mixte Transmanche in Normandy.

Mr Mathieu said: "The losses suffered as a consequence of vast subsidies given to DFDS to prop-up the loss-making Newhaven-Dieppe route hurt Brittany Ferries and the regions in which we operate.

"Portsmouth is our UK-hub and we want the city and the surrounding region to benefit fully from our long-standing partnership."

He added: "As well as boosting their bottom line, subsidies ease the significant cost of decarbonisation - costs that must be borne fully by every other ferry company operating on the Channel."

The next hearing is on 6 June in Brest in France, Brittany Ferries says.

As well as the civil action, Brittany Ferries has also lodged a complaint with the EU's Directorate-General for Competition.