TRAIN giant GNER has launched a legal challenge against a decision by the Office of Rail Regulation (ORR) to give a rival company a foothold on the tracks.

The York-based firm has issued proceedings for a judicial review on the basis that the ORR's decision was discriminatory, an unlawful grant of state aid, and a distortion of competition, and contravened European and national law.

An application to the High Court has been made for "expedition", and GNER today said it hoped that the judicial review hearing would take place in July.

GNER has challenged the decision which gave Grand Central access rights to run a limited number of trains between Sunderland, through York, to London.

A spokesman said it believed the ORR's decision was "unlawful and creates unfair competition" because, it claims, Grand Central would not pay either the fixed track access charges or premium payments that GNER pays under its publicly-specified franchise contract.

GNER has also challenged the need for Grand Central to stop at York, which the company says is already served by 61 trains a day to and from London.

But Ian Yeowart, Grand Central managing director, said his company believed GNER's case was "without merit". He also said the instigation of legal proceedings was "bound to delay" Grand Central's launch on to the tracks, which was due to have taken place at the end of the year.

"These issues were challenged at hearings with the ORR," Mr Yeowart said. "We believe their case is without merit. Our stated aim is to create new travel opportunities and Sunderland, York to London is not available and important. This is bound to delay us by a few months and it is disappointing, after waiting such a long time to get started, that we are now further delayed."

A GNER spokesman said: "We welcome competition as it encourages us to keep improving, but competition should be on a level playing field."

Updated: 09:20 Tuesday, May 23, 2006