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Tory Chris Grayling is back in the High Court today over his Brexit ferry contracts.

The case concerns his decision to award more than £100 million in contracts to three ferry companies under no-deal Brexit plans.

The contracts, which have all since been cancelled, attracted widespread criticism after it emerged that one of the companies, Seaborne Freight, had been awarded a £13.8 million contract to run services between Ramsgate and Ostend despite having no ships.

In March, the Department for Transport (DfT) paid £33 million to Eurotunnel in an out-of-court settlement after the firm launched a High Court challenge over the procurement process for those contracts.

(Image: Getty Images)

P&O Ferries is now suing the Government over the settlement, claiming the £33 million payment constitutes "an unlawful interference in a competitive market" which gives Eurotunnel "a very substantial competitive advantage".

At a preliminary hearing in London on Tuesday, P&O's barrister, Michael Bowsher QC, argued that the settlement agreement is "irrational ... fails to treat similarly situated parties equally (and) was pursued for improper purposes".

P&O wants the High Court to quash the DfT's settlement with Eurotunnel, or order the Government to recover any of the £33 million which has already been paid.

Alternatively, P&O is claiming up to £33 million to compensate it for loss and damages caused by the "financial benefits" it says have been unlawfully provided to one of its rivals.

(Image: Philip Coburn)

Lawyers for Mr Grayling, who is defending the claim, have suggested that a full trial should be heard in January 2020.

Mr Justice Fraser ruled that a further preliminary hearing be listed in July, and allowed Eurotunnel's application to intervene in the case as an interested party.

In December, Mr Grayling awarded contracts worth a total of more than £100 million last December to three firms - Brittany Ferries, DFDS and Seaborne Freight - to run extra services in the event of a no-deal Brexit.

The DfT said in February that it was terminating Seaborne Freight's contract after Irish company Arklow Shipping, which had backed the firm, stepped away from the deal.

Earlier this month, it was announced that the other two contracts had also been scrapped, at an estimated cost to the taxpayer of £50 million.

A Government spokesman said: "This cross-Government decision helped protect vital freight capacity for medical supplies to enter the country, in the event the UK left the EU without a deal.

"We are confident we acted appropriately in reaching an agreement with Eurotunnel."