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Appeal against Northern Isles Ferry Services subsidised contract refused.

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Appeal against Northern Isles Ferry Services subsidised contract refused.


24 July 2019

Pentland Ferries v Scottish Ministers [2019] CSIH 41

State aid – public service contract

The decision of the Scottish Ministers to offer a subsidised ferry contract for the Northern Isles, and in particular across the Pentland Firth between Scrabster and Stromness has been upheld by the First Division. The Court provided guidance on State aid and the Altmark criteria in the context of the Maritime Cabotage Regulation.

On the facts of the case, the Lord President held (1) the Scottish Ministers had not manifestly erred in determining that under normal market conditions, transport services to Orkney would be inadequate without the Scrabster-Stromness route; (2) the service operated by the petitioner (St Margaret’s Hope to Gills Bay) alone would be inadequate; (3) the Scrabster-Stromness route cannot be operated commercially without subsidy; and (4) the proposed subsidy was necessary and proportionate.

Ruth Crawford QC and Ewen Campbell acted for the Scottish Ministers; and Mark Lindsay QC acted for Pentland Ferries.