Call for offers for operation of Gozo ferry service due shortly

A public call for offers for the operation of the ferry service between Malta and Gozo will be issued shortly, following the conclusion of talks with the EU, Infrastructure and Transport Minister Austin Gatt said in reply to a parliamentary question .

The minister said the government had first opted to discuss its draft call with the European Commission, to ensure that it conformed with EU rules.

EU officials recently confirmed that the draft respected the rules, and the public call would therefore be made shortly, the minister said.

Earlier this year, Gozo Channel Ltd's six-year exclusivity agreement, which expired on April 21, was extended until the government completed delicate discussions with Brussels and a new tender was awarded.

The controversial contract - giving Gozo Channel a monopoly over the ferry service between the two islands - had been criticised by the European Commission, which viewed it as breaching the EU's competition rules.

The agreement, signed just days before Malta joined the EU in 2004 without a call for tender, also stipulated that the company would benefit from an annual subsidy of €3.4 million as part of its Public Service Obligation (PSO).

Malta has been taken to the European Court of Justice over the issue, but the government successfully argued that Malta was not bound by EU rules when the contract was signed.

According to EU rules, the Malta-Gozo ferry service has to be open to competition

The government has reportedly been trying to convince the Commission that the service cannot be operated by more than one company, and social obligations have to be respected.

However, Brussels has been insisting that the service should be open to full competition where all European companies interested would be able to tender.