P&O Ferries has confirmed it will strongly contest any attempt by the French authorities to use “illegal” state aid to prop up failed French operator SeaFrance.

SeaFrance, in administration since June 2010, is presently the subject of a French court hearing to decide whether it will be sold or liquidated.

The move follows a decision last month by the European Commission that the firm had been propped up illegally by the use of state aid from its parent SNCF to the tune of €220 million.

Now two interested parties, a joint venture between ferry companies DFDS and LD Lines, and a separate bid from a SeaFrance staff and union co-operative, have tabled plans to acquire the company’s ships at a knock down price by pledging to employ some of the SeaFrance crews on an on-going basis.

An earlier court hearing valued the SeaFrance fleet at between €123 million and €168 million but the DFDS/LD ferry consortium is offering a paltry €5 million.

The employee co-operative has offered a peppercorn €1.

P&O Ferries says it has submitted a formal complaint to the EC Competition Commission in Brussels because it is concerned the French authorities may sell the assets of SeaFrance to a third party at less than fair market value.

The company says that to do so would amount to the continuation of an illegal state aid subsidy.

“It would be totally unfair for the assets of a bankrupt company to be passed to another ferry competitor for a pittance and P&O Ferries will vigorously defend its position,” said P&O Ferries chief executive Helen Deeble.

“The ferry market should operate on a level playing field without illegal subsidies. That principle is enshrined in EU law in the interests of a fair and open market and it is time the law is upheld.

“The European Commission has already ruled that the subsidies paid to SeaFrance are illegal.

“It cannot stand by and allow the ships to change hands in a way that allows such a deal to continue distorting competition.”