The UK's Department of Transport has cancelled a contract with a company to provide extra ferries in the event that the UK leaves the EU without a deal.
Seaborne Freight was awarded a £13.8m contract in December even though it had never run a ferry service, nor had any ships.
The British government has cancelled the order after one of Seaborne's backers, the Irish ferry company Arklow Shipping, withdrew from the deal.
The UK's Department of Transport said it was clear that Seaborne would not be able to meet its contractual requirements.
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A spokeswoman said: "Following the decision of Seaborne Freight's backer, Arklow Shipping, to step back from the deal, it became clear Seaborne would not reach its contractual requirements with the government. We have therefore decided to terminate our agreement.
"The government is already in advanced talks with a number of companies to secure additional freight capacity - including through the port of Ramsgate - in the event of a no-deal Brexit."
Seaborne Freight was one of three firms awarded contracts totalling £108 million in late December to lay on additional crossings to ease the pressure on Dover when Britain leaves the EU, despite having never run an English Channel service.
The department said it had been Arklow Shipping's backing that gave it confidence in the viability of the deal, and that it stands by the robust due diligence carried out on Seaborne Freight.
It added no taxpayer money had been transferred to the company.
